Unhappy Customers Can Be A Good Thing

I know it sounds crazy but having unhappy customers can be a good thing for your business. Now to explain that more, not everyone who is unhappy adds value. Some people are just going to want to browbeat you about everything and anything and there is little you can do to change that.

If you have a customer who is unhappy with your product, and will tell you why they are unhappy and give some ideas on how to improve the product then it can help you improve your product for future releases. You will never be able to keep everyone happy all the time and adding an expensive update to your product which really only applies to one person can push your company over the edge.

The art is to be able to sift out the real issues, some people will call and complain when they are having a bad day. If they had bought your product the day before when all was sweetness and light they would never have called. This can be really tough to work out and you do need to listen to every complaint and balance it out.

Do They Have A Point?
You need to be honest with yourself, it can be hard to see any truth when someone is shouting at you. But once you have dealt with the situation take some time to sit and review the complaints. Look on each complaint as an opportunity to learn something about your business and how your customers view it.

Not Everyone Who Is Unhappy Complains
Remember that not everyone who buys or uses a product and is unhappy with it will complain. Sometimes people just make do with what they have and vow to never  use it again. They may well tell others about their bad experience but never call you to complain. This is why you can never assume that just because you got 5 calls only those 5 people are unhappy.

Can’t Please Them All
While it is true that you can not please all the people all the time this does not mean that you should ever stop trying. When you stop trying your business is on a downward spiral and that is not going to end anywhere positive.

Starting A Business For The Stay At Home Mom

Starting a business can be hard and interesting work, a lot like starting a family I suppose.  Add in being a mother with young children still needing a lot of attention and you are going to have to become a wizard at organization and getting back on task quickly.

Anyone who has or has had small children knows they can take a lot of care and attention.  If you are lucky, you might have children who are fairly self sufficient once they reach about the age of 5 but there are those who still demand attention.  As they enter pre-school and kindergarten you will have time available to be able to work on your business uninterrupted.  But what do you do if they aren’t school age yet?

This is where good time management and organizational skills come in handy.  Of course, many stay at home moms trying to create a business will use those lovely spells when the children are actually asleep to get some work done.  With very young children this can work.  At least it can once they are sleeping through the night and you are no longer so sleep deprived you must use those nap periods to catch up on your own sleep.

As the kids get older and start taking shorter naps or give up on them altogether, you will have to resort to other techniques to get your work done.  The first is to either get up earlier than your children to work or to work after they have gone to bed for the night.  This might net you an extra hour or two a day and many a fine business has been built in just such a manner till the children got older.

If you do only get an hour or two a day to work you must focus even more intently than you normally would. You do not have time for surfing the net and admiring the latest   videos of a cat dancing the macarana. Unless of course that is part of your business.

Be Organized
Another technique is to be so organized with your work that you can easily set it down to attend your child and then pick it back up once the matter has been attended to.  One way to accomplish this is to create checklists of every activity you do in your business.  When you must stop to attend the kids, use some type of marker to indicate what step you are on so it is easier to pick up where you left off.

Of course, maybe one of the best techniques is to plan to have your husband pull some child duty time on the weekends or in the evening when he is home.  After all, children benefit from one on one time with Daddy.

If that doesn’t work out for some reason try using some of your income to get a babysitter for a few hours one day, or maybe two, a week.  Yes, you may be home with your children because you think it is best that you raise them, but doing well in your business will be good for both you and them.

Think of the extras that time spent on and growing your business will mean to what you can provide for the children.  Remember, too, that one day, as hard as it may be to see now, those children will grow up and leave home.  What kind of memories will they have and what kind of life will you have once this happens if you don’t build your business?

Life Work Balance
This has always been the hardest things for women who have children and want to work or start a business. Balancing out the needs of family and the needs of your business or work is always going to be a struggle but it will be worth it.

Let Your Business Finance Your Growth and Expansion

Finances Matter
One important aspect of your business , if not the most important one, will be the financial side.  After all you are in business to make money and provide yourself with a nice income to pay the bills or to have all the things you dream about like the big house and fancy cars.  However, one point about business finance is in order to make money you most often have to spend money to start.

Consider even a very small business like being the window cleaner in a small town who is just starting off.  Even such a business person must buy a bucket, a window squeegee, and some cleaner to get started cleaning windows.  No matter how much of a shoestring you start a business on, the fact is you will spend some money doing so.

But that shoestring may be the best way to start a business.  So many people think they have to begin by mortgaging the house or finding investors.  However fantastic your business idea might be, if it is your first time starting your own business, you really do not want to start off deep in debt.

Debt Can Equal Stress
For one thing, this will add a lot of stress into your life which you do not need when just starting out.  Secondly, what happens if your idea goes belly up?  What if this attempt fails?  Now you have a busted business and your home is tied to that failure.  Try to keep the banks from taking your home.  And before you say that will not happen, please realize that many of the greatest entrepreneurs you know have had business failures.  Even Donald Trump has been bankrupt before he came back and became a success again.

Here is another thing to think on when tying your home as collateral to your business.  What happens if you and your spouse get a divorce?  I personally know of such a thing occurring and the outcome was not a civil divorce.

This should make the idea of starting a business on a shoestring look a little better.  Now realize I don’t mean that you should underfund your business.  I have also seen several businesses fail because they simply did not have enough money to keep them going.  In one case, the store front never even opened.  You do need to be realistic about your business finances and what it takes to get going and keep going.

What is meant by shoestring here is more along the lines of letting your business fund its own development and expansion.  Going back to our window washing business, for example, you could do the work yourself with the money you earn buying the basic supplies you need.  But as you add clients you will get to the point that you need some help.  This is when you look to the business for the funds to pay for that extra helper and let the business finance itself.

Build and expand only as the business finances allow you to do so.  Do not underfund but also do not spend more than you should especially when just starting out.

Every Business Needs an Attorney

Who You Going To Call?
Do you know who to call when legal problems arise in your business?  If you are like a lot of small business people, you probably do not know.  You figure if a problem comes up and you must get one you will just look in the phone book.  You will select one who has a decent looking advertisement, who has cheap rates, or who your mother says she heard about from a friend of a friend.  Unfortunately, that is the reality for most small business owners.lady justice

Attorneys are not cheap which is the major reason most small business people do not have one as a member of their team.  It is just an unneeded expense, right?

It is true that there are a lot of things you do not need an attorney for such as writing up your business plan or getting your business license.  With the help of forms and websites created by attorneys you can get a lot of things done for your business without actually having to talk to or hire a lawyer.

But let me ask you a couple questions.  Do you have a product you sell or a service you provide or a store on Main Street in your home town?  Do you have employees?  If any of those apply, you are going to definitely need to have an attorney on your team.

We Live in a Litigious Society
It has been said many times that in the US we live in a litigious society where people are sue happy.  If you provide a service or product to people, have a store where your customers come to look at what you have for sale, or have any employees sooner or later you are going to be sued.  Waiting till you get sued to talk to an attorney is going to be too late.

If you have a business attorney before such a thing happens, he or she will make sure all is done beforehand to prepare you for this eventuality.  Your attorney can make sure you know all the pitfalls about questions you cannot ask in an interview with prospective employees.  A lawyer can look over any contracts before you sign them for potential trouble spots.  An attorney can help you negotiate better terms on real estate leases or special licensing for products. If you are the one who designs or invents or otherwise creates, a lawyer can help you protect your ideas or intellectual property.  One can handle mediations with customers and try to prevent you from going to court.  Court is most often a losing proposition and becomes quite costly.

What if you are just a sole proprietor who just runs a couple of information websites online that bring you a little income by way of adsense or acting as a salesman?  You do not need an attorney, right?  If that is your thought let me give an example of a situation of why every business needs an attorney.

Most websites use pictures to brighten up the website and make articles more interesting.  However, you have to be very careful where you get your images.  Lots of people have been receiving demands from Getty Images for payment for illegal use of images.  Sometimes they are correct but other times they are not.

In one case, after the situation was thought to be resolved, Getty came back with demands again two years later.  This person needed legal advice right away.  Because she did not have an attorney on her business team, she did not know what to do or who to call for help.  This is just one small example of why every business needs an attorney.  Be sure to know who to call when you need legal help.

Do you know why your business is failing?

As I have consulted with business owners throughout my career, I am often asked, “What is the one thing I can do to guarantee the success of a business?”  Although there is no answer to fit every business, there is one thing if a business does not do it is guaranteed to fail.  This one thing is to have a plan in place to sell their product or service.

It doesn’t matter how good your product or service is, if you cannot convert your potential customer into an actual customer your business will never succeed.  There are three key things you need to be aware of when selling your products or services.  First, selling is different than marketing; second, you need to set a budget; third, you need to create a plan.

Selling is Different than Marketing
This may be news for many of you.  Most business owners I work with believe selling and marketing are the same.  As a result, they spend a lot of money marketing their business and can’t figure out why they have no customers.  The reason is because they have not advanced into the selling portion of the business.  It is one thing for a person to know about your business, which is what marketing does.  It is quite another to have a person actually spend money at your business, which is what happens when you sell.

When you sell you are actively trying to interact with people who will become buying customers.  It requires confidence and determination, because when you sell a product or service, there is a lot of rejection that can come with it.  Most people who sell will get far more no’s than they get yeses.

Maybe the best way to explain the difference is by looking at a retail business.  Let’s say you have a retail store that sells hardware.  In order to get customers in your door you are going to have to market your business.  You can do this through a lot of different methods.  Some of these might include ads on the radio, inserts in your newspaper, or YouTube videos.

As people learn about your business from the marketing you have done, they are going to come and see what you have.  Once they step in the store, this is when you start to sell.  Your marketing will have done you no good if you can’t convert those coming in to your store into buying customers.  Retail stores do this by having trained sales staff who know the business and can help customers see why they need the products being sold.

Set a Budget
No matter what it is you are going to spend money on for your business you are going to want to establish a budget.  The reason for this is it will help you make sure you have the cash you need to pay for your expenses when they come due.  Most businesses that do not use a budget generally find they have cash flow problems.  The reason for this is because they end up spending more than they think they are.

For most small businesses, your sales budget should be between 5 and 15%.  Your business might be different, so please do not just use this percentage blindly.  If you have a business where your product costs are high, say 70-80%, you are not going to have enough profit margin to spend this much on sales.

One way to help you stay within your budget is to establish your sales system to where you are paying a commission, equal to a percentage of sales.  This will help you make sure you are always within your budget.

Create a Sales Plan
Selling is no different than any other part of your business.  You need to create a plan on what it is you are going to accomplish and then stick to it.  You first need to identify how you will sell your product or services.  This might include hiring a salesperson, contracting with a third party, or doing it yourself.  Either way, you need to be very clear on how you will sell your product or services.  This might include over the internet, business to business, or in your location.

Once you have done this, you need to make sure you include in your plan any training that will be required, as well as a method to hold the sales division accountable.  Accountability is a key factor when dealing with sales.  Your plan should also include any scripts needed to sell your product and a detailed explanation on how your sales process will work.

The last part of your sales plan should include your budget.  Here you will talk about how you will compensate those who sale your product and how much of the businesses money you plan to spend on sales.

Look At The Numbers
If your marketing is working to bring people into your store or to your website but they are not buying anything then you need to look at the reasons why. Is your product too expensive, are your sales people not working hard enough? You could arrange for exit questionnaires to be do when one of your customers leave you would have someone ask them why they did not buy.

Not selling your products will kill your business, if you can increase your sales by you can save your business

Starting Your Own Business – 5 Things to Know

Being a business owner can be one of the most exciting things you will ever do in life, but if you do not plan your new business correctly, it can also be one of the most Starting a businessfrustrating experiences you will ever have.  My goal is to help you make the most of the opportunity that is ahead of you.  To do this, there are five things every individual should know before they go into business.

Get to know yourself – Getting into business is no different than most other things you will do in your life; you need to start with yourself.  All too many individuals end up in a business either they don’t like or they are not qualified to operate.  Therefore, it is very important you take some time before you either buy, or start, your new business to understand who you are.  You need to understand your strengths and your weaknesses, your management style and your leadership skills.  You also need to make sure what it is you will enjoy doing with your life.   The more passion you have for your new business, the better chance of it being successful.

Many people use their hobbies as a way to find a business they want to get into.  You need to be very careful when using this strategy.  The reason is because doing something for 8 to 12 hours a day is much different than doing something every once in awhile.  I really enjoy drawing as a hobby, but it would be much different if I were to do it as a business and have deadlines and clients that expected me to draw what they wanted me to draw, instead of being able to draw whatever I want to.

Create a business plan – Once you have figured out what it is you want to do, it is critical you put together a business plan for your new business.  Failing to follow this step, is one of the main reasons over 50% of new businesses go out of business before they turn 5.  A comprehensive business plan will keep you from making a lot of rookie mistakes.  It will help confirm whether or not there is a place in the market for your product or service and if you can make it profitable with your projected overhead.  Yes, a business plan takes time to put together, but what is a week or two, if it keeps you from making a mistake that might haunt you for a lifetime.

Get a second opinion – Once you have picked the business you want to own and have completed your business plan, it is important you get a second opinion on your work to this point.  I recommend you either meet with a business coach, experienced entrepreneur, or a CPA.  They are not going to have all of the answers, but they should be able to see big holes you might have missed, because you are too close to the project.

Location, location, location – If you are going to open a retail business, you can not overlook the importance of your location.  You must realize that cheap rent doesn’t always equate into the best location.  I have a client that rents a space in Disneyland.  If you did not know where his business was located and I were to just tell you what he pays in rent, you would tell me there is no way he could succeed and that he must be crazy to pay this amount.

Fortunately, due to the location, he makes hundreds of thousands of dollars each year.  He does this by selling a product that millions of people who come into Disneyland want.  In fact this location is the most profitable of the dozen or so locations he has.

Watch your emotions – You have got to do everything you can to keep from getting emotionally attached to your new business opportunity.  Your chance of making a decision you will regret is increased substantially when you get emotionally attached to the business opportunity.  The reason for this is you fail to see what everyone else sees.  It’s like having beer goggles; only what you have is bad business goggles.

Don’t get in a hurry when looking to start your new business.  Every extra minute you spend in making sure your business is set up correctly, will be returned to you tenfold once your business is up and running.

Mindset Matters For Business

Having the right mindset for business success is vital, if you do not believe in your own business then no one else will. When you are starting a new business it can be hard tomindset make people see your vision (especially when you have no track record) and if you show doubt then they will question your abilities and choices even more.

Starting a business (and making it profitable) will take all your energy (both mentally and physically) at first so you need to make sure that you get your mind in the right place.

  • Remove Negativity – If you know that someone is going to be negative about your business no matter what happens, do not talk to them about business.
  • Be Positive – If you go home and start sharing negative situations from your day constantly then your spouse is going to have a negative view of your business
  • Look for positive people-You become who you mix with, if you surround yourself with positive people you will be more upbeat
Trust Yourself
You know yourself better than anyone else does, if you have done your research before starting your business then you know what needs to be done. Make a plan and stick with it.
Be Careful Who You Listen To
We all need people but you need to be careful who you listen to, not just because of the possibility of negativity. Taking advice on building a house from someone who has never built a house doesn’t make any sense does it? Well the same applies to business, do not elicit advice from anyone who has never been in business.
The suggestions they give may sound valid but the reality is that they have never walked in your shoes and it is just more noise that creates a distraction. It is very easy to get pulled 100 different ways by well meaning friends and colleagues, you need to keep your eye on the goal and keep your mind clear of uneeded distractions.

 

Do You Hate Your Job?

I was recently looking at the study below and was shocked at the numbers quoted. If you are in a job you hate then it is better for yourself and most likely for the company that you work for if you leave. Someone who hates their job tends not to do it very well.

No one has to stand up at this very moment and walk out of their job, just start looking for another job. There are some other options you could consider

Get More Training
If you are unhappy in your job and can’t move due to the fact that you are not equipped for anything else, the easy answer is to get more training. This could be as simple as becoming bilingual, or doing some computer courses in the evening. You do not always have to get a full degree in something to get a job, as long as you have the training the job needs.

Change The People You Work With
According to the survey by the NBRI 33% of people hate their job because of annoying coworkers.  Take some time to think about that, is it just the person you work next to (if so why not move desks), or is it a situation that is driving you nuts. For example one person who always “borrows” your last tin of diet coke but never brings any in to replace it, or someone taking your yogurt from the fridge.

Could something as simple as moving desks or telling the person involved just how nuts it drives you when they behave as they do be all it takes to improve your work environment? I am in no way saying that these small things will fix everyones office but it is something that everyone should consider before they leave a job that they otherwise like.

Lack of Passion
This is one of the hardest things to deal with, if you just do not have any kind of passion for the industry you are working in then it can be hard to fake it.  I can not think of any quick fix for this, although sometimes a decent break from the industry will allow your passion to reignite.

Long Hours & Long Commute
These two often go together, people take a job because it pays so well and then find that they have to commute for work and that the day in the office is a long one.  After a few months of doing the commute and the long hours the money doesn’t seem to matter so much.  Take a look at your income and how much it is costing you to get there and you may be surprised to find that you are not really earning quite as much as you thought.

If your long hours are leading you up the ladder to where you want to get then to some degree you have to just deal with them. If you are working long hours because everyone one else does then you need to think about the environment you work in. Going to work early just because everyone else does makes no sense at all.

Life Is Short
I hate to say it but the truth is that we all only have a limited time here and it is a waste to spend it in  a job we hate. While many people feel they have no control over their work environment the truth is they do, you can always resign from a job. Obviously it is better if you have another one to go to before you resign but that is not always how life works out.

If you really hate your job and work environment then do something to change it. The only two options are to either change the way you work, or change the place you work .

 

Business Growth Can Be Bad

grow your business

Grow Your Business

Beware of Growth!
From the day most people start their own business they run ahead full steam to try and grow, getting more customers consumes every waking thought. In fact, if you are like most business owners I deal with, what you are still hearing is “The bigger the better!”

So you ask, “What is there to be scared of by getting more business?” There is nothing to be scared of, but there is plenty to be prepared for.

Plateaus
It is very important if you decide to grow your business you become aware of where your business will plateau. What this means is your business gets to a level where your increased costs exceed your increased revenue and so even though you are doing more volume you are no more profitable than before. In fact, you may be less profitable.

A good way to look at this is to assume you have a small office which currently fits your needs. It has just the right number of offices, you have the right amount of office furniture and even your computer server is perfect for the volume of business you do. Then you take on a new project that requires you to hire two new employees. Initially, you think, great, this means more money for me as an owner.

But does the extra income actually increase your bottom line? In addition to hiring the two new employees, you now have to get another office building. How do you handle this? Can your people work in multiple locations, or do you need to get a whole new office? What if your current lease isn’t up?

You also need to get new office furniture and computer systems. All of this costs money and requires your time. In fact, after you have made all of these changes, you realize you are actually taking home less money than you did before, because your overhead costs are so much more.

This doesn’t mean you should never want your business to grow, but it does mean you need to look at where your plateaus are. It is just as important not to get stuck on a plateau as it is to not grow at an inappropriate rate so you are working harder and taking more risk, but getting none of the rewards.

Capital Requirements
Do you have enough of a cash reserve to allow your business to grow like you want it to? This is something you better decide before you commit to growth rather than afterwards. If you don’t, you may find your successful business is now out of business.

As you can see from the above example, growth requires a business owner to have a cash reserve in most cases. Whether it is new assets, additional payroll, or just the way your accounts receivable works, you are going to need money to fund this process. Of course you can finance some of your growth with short term credit but that is not really the best way to grow.

I recently met with a client who had a very successful business in my area and was making great money. As he looked at his model, he thought if I can duplicate this, I can make substantially more money. So that is what he tried to do. He created a franchise system and began the process of taking it nationwide. The only problem is he didn’t calculate the cost of expansion before he began and because of the commitments he made to his franchisees he could no longer turn back. As a result, he is stuck in a situation where it looks like his business will not survive.

You can prevent this from happening in your business, by making sure you have good projections. They will allow you to better understand what cash is going to be required and when the additional revenue your growth creates will begin coming in.

Life Style
When I got out of college, I had the goal of building the largest CPA firm in the market I was working in. I thought it would be so great to be one of the Big Dogs in our area. Over the next 15 years, I followed my dream and some buddies and I went on to build what became the second largest CPA firm in the market we were in. We only had one more company to beat out and my dream would be fulfilled. The only problem was I no longer had the dream.

What started out as a fun opportunity, turned into something I never imagined it could. The firm got so big that instead of spending my days working with clients, which is what I love the most, I spent most of my days helping employees work through different situations and making sure they were trained properly. My big dream had turned into my big nightmare. I was no longer having fun. As a result, I finally sold out and started a much smaller firm, so I could go back to doing what I love.

Growth = Change
Growth requires you to change the things you are used to doing every day. When this happens you want to make sure you are going to be capable of handling your new responsibilities, as well as making sure it will be something you enjoy doing. I was lucky. I had partners who could buy me out and were able to pay me a fair price for my ownership percentage. You might not get so lucky.

Plan Your Growth
So does this mean you shouldn’t grow? Absolutely not. In fact, every business needs to continue to grow if you want to stay ahead of inflation. What it does mean though is you need to plan your growth and make sure you can handle the opportunities which are being presented to you.

Mining Your Database

increasing business

Mining Your Database For Income

Do you ever wish you had more business, but don’t know where to find it without spending thousands of dollars on advertising?

You need to look no further than your own office. If you have been keeping contact information on those who have worked with your business, you now have a database that is filled with valuable information about your current customers, previous customers and even potential customers.

This database is worth thousands of dollars in additional revenue from a group of people who are at least warm leads, if not “HOT” leads. They will know your name and it is always cheaper to sell to an existing lead than to sell to a new lead who has never even heard your name before.

If you have never worked your database, you will be very surprised on how valuable your database really is. It alone, can be the piece you have been missing to continue growing your business. The three key things you should keep in mind when working your database are:

1. Look For An Up Sell
This is your best opportunity to make additional money from your database. This process works best with current customers, but it can also work very well with previous customers or even potential customers.

You start by identifying the products or services that you offer. You then must identify which products or services you offer that are not being used by each person in your database. Once you have figured this out, you need to approach those in your database about these additional products or services.

For many of those in your database you can up sale them during a meeting or a lunch. If you don’t have the time, or resources, for this type of approach, you can reach out to these individuals through a letter or email and then follow up with a phone call.

Face to Face Contact is Best
As a CPA, I make it a point to meet with my tax clients each year between September and December. I do this for two reasons. First, it shows them I care about them and am thinking about their business even when it isn’t tax time.

The second reason is that meeting them at this time of year gives me an opportunity to offer my clients additional services when their mind is not fully focused on getting their tax return done. I have found by doing this, I can get additional services out of almost 90% of my clients. Most of this new business is for services they really need, but wouldn’t think about calling me about if I didn’t schedule the meeting.

2. Offer Discounts
When you are approaching previous customers, or potential customers, who have previously looked into doing business with you but never followed through with it, it is always a good idea to offer them some type of discount. This shows these individuals that you care about having them as a customer and that you are willing to make a sacrifice to get them back.

The more direct the discount is, the more opportunity you will have of getting them to do business with you again. Let’s assume you are a retail clothing store. You have contact information in your database for a previous customer who has only bought shoes from you. If this is the case, you are going to have a much better chance of getting her business back by sending her a coupon for shoes, than if you were to send one for pants.

Make the coupon time sensitive, if people feel a sense of urgency they are more likely to use the coupon. Once they see a $20 discount on offer, if they don’t use it they feel they have lost that money.

3. Say you’re Sorry

Over the years you will lose customers for a number of reasons; price, service, quality, or sometimes something as simple as another salesman contacting them at the right time. If you find that a customer has left you because they were dissatisfied with your customer service or something that happened which was within your control, don’t be afraid to say you are sorry. Many times this is all it takes to mend a relationship and to get the business back.

You also need to be willing to listen and understand what the true issue was that caused them to stop doing business with you. This will allow you to have a better chance of keeping them happy if they do come back as a customer. If you believe the issue which caused the customer to stop doing business with you still exists in your business, don’t lie and make a promise you can’t keep. You will lose the customer again and not only never get them back, but they will spread the word to most of their friends.

Take time now to look through your database to find opportunities to expand your business. If you are not keeping a database, there is no better time to start than today, it can something as simple as a excel spreadsheet with everyone name and phone number (although more detail is usually better). I know many businesses that have doubled their revenue by effectively working this one key resource.