Monthly Archive for January, 2013

Plan for success while operating for survival

Blasingame’s 2nd Law of Small Business states: It’s redundant to say “under-capitalized small business.”

Growing small businesses operate in the narrow danger zone between the leading edge and the bleeding edge of the marketplace. And since our capital reserves and options are limited, every small business CEO makes decisions every day that are at once as much about survival as success.

Operate for Survival
Here are four “operate for survival” things to do that will serve you well this year, followed by four “plan for success” ideas.

1. Cash used to be King, today it’s the Emperor. Ask employees to find and cut waste. Get them involved in reviewing operational processes and eliminate or tighten up inefficient ones. What’s their motivation? How about job security? Watch the pennies and the dollars will take care of themselves.

2. Stay close to accounts receivables and cash management. Many tasks can and should be delegated, but in a small business, whether you’re growing or just holding on, cash management is not one of them.

3. Declare war on excess inventory. Inventory is cash you can’t spend until a customer pays for it. Practice Just-In-Time (JIT) inventory management, not just-in-case.

4. Stay close to customers. This isn’t complicated: Ask customers what they want and then give it to them. We’re in the Age of the Customer – know your customers’ expectations.

Plan for Success
Since opportunities will present themselves over the next year, here are four “plan for success” thoughts to consider as you take risks:

1. Eyes wide open. The marketplace we’re entering is going to look different than last year. That means opportunities – and threats – will look different, too.

2. Measure twice, cut once. Before taking a big growth step, apply the carpenter’s rule. Don’t scrimp on due diligence: check your assumptions, recheck your assumptions and then proceed with the best information you have, which might tell you to stop.

3. Mistakes are expensive. Can your capital picture support inevitable mistakes and/or surprises? Remember, there is a very fine line separating opportunity at the leading edge and the cash-eating bleeding edge.

4. Make your banker your partner. Keep him or her informed whether the news is good or bad – especially the bad. Remember this: An uninformed banker is a scared banker and no one ever got any help out of a scared banker.

Successful small business CEOs operate for survival while planning for success.

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I talked more about how to operate for survival while planning for success this week on The Small Business Advocate Show. Click here to listen or download.

Check out more of Jim’s great content HERE!

Take this week’s poll HERE!

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Small Business Advocate Poll: “Just get out of our way!”

The Question:
What do you want the federal government to do to help you with your small business?

0% - Initiate more programs to help small businesses

71% - Get out of our way by reducing taxes and regulations

29% - Both of the above

My Comments:
These days it seems a lot of people have their hands out for help from the government; from GM, Chrysler, and AIG, to who knows how many big banks. Then there are the unions, public and private, that rely on government support for their very existence. Big corporations make billions of profits doing business with the government. And one out of every seven Americans - over 50 million - now receives some kind of welfare.

But there is another group of folks out there that is about half the number of welfare recipients, produces over half of the U.S. economy, and sign over 70 million paychecks every week - small business owners. So what does this group want from the government? Well, we asked them about that last week in our online poll, with this question: What do you want the federal government to do to help you with your small business? Here’s what they said:

Not one person chose, “Initiate more programs to help small businesses,” as their answer. But those who believe the government should just, “Get out of our way by reducing taxes and regulations,” came in at 71%. The rest, 29%, allowed that the government should do “Both of the above.”

What if every group of Americans felt the same way small business owners do? I would like to see what that looks like, wouldn’t you?

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I talked more about what small businesses want from the government this week on my radio program. Take a few minutes to download or listen.

Check out more of Jim’s great content HERE!

Take this week’s poll HERE!

Watch Jim’s videos HERE!

Is your business ready for mobile prime time?

A smartphone is as close to a magic wand or lightsaber as exists outside of the dimension of fantasy.

Recent research by eMarketer indicates that more than 130 million Americans will own one of these in 2013. The same group is projecting that number to grow by a third – to almost 200 million smartphones – by 2016. That’s just about every American who isn’t a small child or nursing home resident. Here’s another way to say that: Essentially every one of your prospects and customers. Allow me to spell it out for you: If your business isn’t ready for mobile prime time it’s a dinosaur waiting to become extinct. Any questions?

Here are two important first steps so your business will avoid extinction by mobile:

1. Get your online information optimized for local search. This is critical for a comprehensive online strategy, but mandatory for mobile prime time, because mobile searchers are often trying to literally find a business. If I’m in Peoria and hungry for pizza, you want me to find you in my local mobile search for “pizza in Peoria.

2. Decide whether to invest in a mobile site or a mobile app; either one will get your business ready for mobile prime time. Here’s the difference:

Mobile app: A software application that downloads to and resides on a customer’s mobile device.

  • Advantage: Downloaded information, like an article or podcast, that can be used later without an Internet connection.
  • Disadvantage: Updated information, like today’s menu or discount, has to be downloaded and will likely take longer to present than a mobile page.

Mobile site: Your website condensed for the smaller mobile screens. When your regular URL is requested from a smartphone, the mobile site presents automatically with the most important elements and less graphics. In other words, form follows function.

  • Advantages: Most mobile sites cost less than most apps to create, update and maintain, and a mobile site icon looks just like a mobile app icon.
  • Disadvantages: Most mobile sites aren’t as sexy as most mobile apps. And just like your regular website, a mobile site cannot be used unless the device is connected to the Internet.

Here are Blasingame’s Ready for Mobile Prime Time Rules of Thumb:

1. Not all businesses need a mobile app, but every small business needs a mobile website;

2. Get ready for mobile prime time or get ready for extinction.

The Age of the Customer is being driven by customer expectations, and nowhere is this truer than with mobile.

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Last week on The Small Business Advocate Show I talked more about mobile computing and the 21st century marketplace with Chuck Martin, mobile-marketing researcher and guru, and author of the award-winning book, The Third Screen. Click on the links below to download or listen to our conversations. Is your business ready for prime time?

What is the current state of mobile computing?

What is the impact of mobile computing on consumers?

Small business can compete against Amazon with a mobile strategy

Check out more of Jim’s great content HERE!

Take this week’s poll HERE!

Watch Jim’s videos HERE!

“Stop and smell the roses!”

“Stop and smell the roses!”

Most small business owners wish they had a dollar for every time some “civilian” presumed to pass judgment on the way we spend our time.

Of course, we shouldn’t follow our dream to the detriment of family, health, or spirit. But civilians should remember that “stop and smell the roses” is a metaphor. And every human gets to define his or her own metaphorical “roses.”

In fairness, it’s not the civilian’s fault, because they are typically those who work someone else’s dream, as an employee. Since their “roses” are not likely to be found where they work, it makes sense for them to think a small business owner should get out of the business more, or to question why we work on weekends, or to encourage us to play more golf.

When you see small business owners working on their business on a beautiful Saturday, instead of playing golf, don’t presume that they aren’t smelling their roses.

Here’s what civilians often don’t understand about entrepreneurs: We don’t have to leave work to smell the roses.

Check out more of Jim’s great content HERE!

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Next Main Street movie: “Small Business Shrugged”

At this moment four years ago we were in the middle of The Great Recession whirlwind. We didn’t know how bad things were going to get because all of the shoes had not dropped in reaction to the financial crisis. Millions were still being laid off, GM and Chrysler had not yet taken bankruptcy and the federal government was injecting the first of trillions of dollars into a shell-shocked economy.

Today, 43 months after the technical end of The Great Recession, surveys I report about on my radio program (NFIB, Tatum, our online poll, etc.), indicate that about a fifth of small businesses are doing well, about as many are doing poorly, and the middle 60% are doing just okay. This economy should be a rising tide floating all boats; but it isn’t. Instead, as in 2009, every small business owner is still anxious about the next 12 months.

During recoveries of past recessions, concerns were about market dynamics created by the usual suspects: inflation, global trade, supply and demand, technology disruptions, fear and greed, etc. But this not-so-great recovery is different.

For the first time in my long career (seven recessions), the origin of what will wake up small business owners at 3am in 2013 are mostly challenges created by the federal government. Here’s the short list: higher taxes; unsustainable budget deficits and debt; hundreds of Obamacare mandates, regulations, penalties and taxes (Galen Institute); thousands of new 2013 regulations costing businesses $123 billion, plus 13.6 million compliance man-hours (American Action Forum).

But alas, there is one more thing which may be more troubling to this market sector that produces over half of the U.S. economy: A zero-sum philosophy coming from Washington that the financial success of “fortunate” Americans is at the expense of others. But successful entrepreneurs are only fortunate because, like every American, they have a Constitutional right to pursue success, not a guarantee of success.

Small businesses take economic headwinds in stride because they know the marketplace is self-healing with the passage of time. But government-created headwinds not only don’t heal, they compound, and this truth does not motivate small business owners to take risks.

Most small business owners want to grow and hire, but they don’t have to. So far, that’s not a government mandate. The next movie the political class may see playing on Main Street could be titled, “Small Business Shrugged.”

Eventually government expansion and economic expansion become mutually exclusive.

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This week on The Small Business Advocate Show I talked more about America’s lack of small business optimism and why political policies are to blame for the slow economic recovery. Click here to download or listen. Afterward, please let me know what you think.

Check out more of Jim’s great content HERE!

Take this week’s poll HERE!

Watch Jim’s videos HERE!

Forge the customer goodwill alloy of “Thank you”

What would you pay for a small business silver bullet to win the fight with Big Boxes and online competitors?

Before you get overwrought about how you would come up with the cash for something so valuable, here’s good news: It’s free and you already possess it.

There are several versions of this silver bullet, each to be used at an appropriate time and engagement, but here’s the default version and the most important one: “Thank you.” I promise, if your customers never leave behind their hard-earned cash without hearing a heartfelt, “Thank you,” your business would become a competitive force to be reckoned with.

Here’s an expanded version: “Thank you for your business.” Long after this sentiment enters the ears of customers, when they’re considering the next purchase of what you sell, they will remember that you looked them in the eye and lodged these words in their heart: “Thank you for your business.”

Here’s one more, in response to a request or when a customer thanks you first: “It’s my pleasure.” And if you really want to pull off the silver bullet hat trick, say, “Thank you. It’s our pleasure to serve you. We really appreciate your business.”

Saying thank you – and making customers believe it – forges what I call the “Customer Goodwill Alloy.” Just as steel is created when you forge iron with other elements, customer goodwill is created when values, commitment and engagement are forged in the crucible of training, practice and execution, causing your employees to say “Thank you.”

We all know what happens when steel is left exposed and unmaintained: Corrosion causes it to revert to its base elements as rust. But do you know what happens when the “Customer Goodwill Alloy” is left unmaintained and exposed to the elements? It sounds like this, “No problem.” Or, “Here you go.” Or, “Have a good one.” Or even worse – nothing! Not even eye contact!

If you want to compete in The Age of the Customer, you can’t allow your business to revert to customer service rust. More than a means to an end, it must become a way of life to forge and maintain the “Customer Goodwill Alloy” every hour of every day of every year.

If your door is open, if your phone is ringing, if your website is working, customers must know how important they are to you. Otherwise, save yourself a lot of money and anguish and close up your business now. The Big Boxes have beaten you.

Paraphrasing Paul Simon so customers don’t leave you, there must be 50 ways to express your delight in serving a customer instead of “No problem.” Use them! Words matter!

“No problem” is a big problem that can be solved by simply saying “Thank you.”

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Check out more of Jim’s great content HERE!

Take this week’s poll HERE!

Watch Jim’s videos HERE!




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