Monthly Archive for August, 2013

SBA Poll: What do you think about Obamacare?

The Question:

The IRS director said he and his employees don’t want Obamacare - they want to keep the program they have. What do you think about that?

7% - I don’t care what kind of health insurance the IRS has.Obamacare is okay with me.

11% - I agree with IRS employees.Let me keep my current coverage too.

82% - Repeal Obamacare and we can all keep our current health insurance coverage.

My Comments:
As you can see, Obamacare is still a very unpopular law, especially among small business owners. In the Feature Article next week I’m going to have more to say about the IRS position and others who seek an exemption for this law. Stay tuned, and thanks for participating.

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Entrepreneurship in the marketplace jungle

If you venture into the marketplace jungle, you may be able to observe that rare wild creature, the entrepreneur, in his or her natural environment (darting is not necessary, entrepreneurs are very gentle - just rub their stomachs). As you study them, you will find levels of vision, curiosity, courage, tenacity, and faith. Here’s what to look for in order to identify this elusive critter:

Vision: Entrepreneurs see things and consider the possibilities before they exist, even as the world is telling them, “It won’t work.” When entrepreneurs are deep into their vision they go into what their families call a “zone,” which is when it’s easiest to slip up on them.

Curiosity: Entrepreneurs ask questions other humans don’t. They can’t help it. If someone asks you a question and you have no idea what they are talking about, you are probably having a close encounter with an entrepreneur. Don’t be irreverent; you might be at ground-zero of the 21st century equivalent of Velcro or the micro chip.

Courage: Entrepreneurs attempt things that other human species won’t. As you peer through the triple canopy at your subject, look for death-defying acts in the face of conventional wisdom. Entrepreneurs eat conventional wisdom for breakfast.

Tenacity: Entrepreneurs keep trying when other humans give up. They have a high pain threshold, which when combined with a visceral desire that can only be compared to the maternal instinct, delivers a primal display of tenacity which often is frightening to other humans. If the entrepreneur you are observing is crouching, lie down quickly. You probably aren’t in danger, but fainting is a possibility.

Faith: Entrepreneurs believe in themselves and their vision. The great writer and even greater curmudgeon, H.L. Mencken, once said, “Faith may be defined briefly as an illogical belief in the occurrence of the illogical.” That’s our entrepreneur! If you see someone demonstrating an inordinate commitment to an “illogical belief,” congratulations. You’ve found your entrepreneur.

Catch and release, please.

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Business interruption: It’s not a matter of if, but when

Ten years ago, on August 14, 2003, a single outage in the electric grid cascaded across eight northeastern states, putting 55 million people in the dark for days.

The Great Blackout of ’03, which also temporarily shut down thousands of small businesses, was a catastrophic reminder that we’re all one squirrel-in-a-transformer, fire, flood, tornado, hard drive crash or computer virus away from being out of business. One survey revealed that three out of four small business owners believe they will have a business interruption event in any given year. Alas, in that same survey, only 20% said they were prepared.

Are you prepared to deal with a business interruption event? Here are a few ideas.

Operational recovery
What would you do if your building became unavailable to you or your customers?

1. Instead of desktop computers, purchase laptops with docking stations that allow key employees to work and connect remotely, both internally and with customers. Make sure the laptops have Wi-Fi and a mobile router (4G) in case your broadband connection goes down. This costs a little more, but it’s good connectivity insurance.

2. Identify and become proficient with cloud computing applications that serve as alternatives for any installed programs that may be lost.

Financial recovery
A significant part of the working capital of most small businesses is from cash flow. What would happen if your cash flow was interrupted?

1. Consider purchasing a business interruption rider on your business’s property and casualty insurance policy that will pay you cash upon the acceptance of a claim. Be sure to read the fine print, all policies are not created equal.

2. Maintain a close working relationship with your banker so you won’t have to introduce yourself to the person you’re asking for a disaster loan.

Data recovery
Small businesses are using digital assets more and physical assets less in the execution of their business model. Are you prepared to protect your data as comprehensively as you protect your building, equipment and inventory?

1. Assign one person to be in charge of keeping all computers enabled with a proven malware program and keep them current on all units.

2. Regularly copy critical data from your hard drives and store it offsite, plus backup your data with a cloud-based data backup and recovery firm.

The only people who never experience a business interruption event are those who don’t have a business.

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Check out my latest segment from The Small Business Advocate Show®. One day, your business will be interrupted. Are you prepared? I offer tips and insights into how to prepare your business for the inevitable interruption that will happen to every business, large or small. Click the link below to listen.

Are you prepared for a business interruption?

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Video- Acquire and create intangible assets for your IP strategy

In this week’s video I explain why intangible assets are important for your IP strategy.

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SBA Poll: We don’t want no shtinking loan!

The Question:
What is your recent experience with getting a bank loan for your business?

24% - I have applied for and received a business loan recently.

18% - I tried to get a business loan from a bank but was turned down.

27% - I don’t think my business could qualify for a bank loan.

30% - Economic and/or political uncertainty makes me reluctant to borrow right now.

My Comments:
The best source of capital for a small business is from profits left in the business. But since most small businesses can’t generate enough profits to grow very fast, the actual primary source of growth capital for a small business is a bank loan.

In our online poll last week we wanted an update on where our small business audience is with regard to borrowing money, so we asked that question. More than three-fourths either don’t want to borrow money from a bank, can’t or don’t think they can.

Small businesses create over half of the U.S. economy. If three out of four small businesses aren’t borrowing money, that explains a lot about why U.S. GDP is stuck at below 2% annualized, doesn’t it? So which comes first, the loan or the growth? Historically, entrepreneurs will borrow money to take advantage of growth opportunities they believe are possible. So, the loan comes first, then the growth.

Four years after the end of the Great Recession, the U.S. economy should be growing at over 3%. Instead it’s slouching along at less than 2%. If three fourths of the sector that produces over half of U.S. G.D.P. is not a candidate for a bank loan, that does not portend a rosy outlook for the economy.

The economy will pick up when small businesses start borrowing money again.

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The original social media is face-to-face

Ever since Samuel Morse invented the telegraph in 1844, each new communication technology has sought relevance in an increasingly noisy universe.

Today there is actual management pain from an embarrassment of riches of communication options. This discomfort is especially keen when connecting with customers electronically: Should you email or send a text message? How about IM? And when should you use one of the social media options?

But from telegraph to telephones to Twitter, there has been one constant that has retained its relevance and impact: in person connection. As I’ve said before, face-to-face contact is the original social media.

For small businesses, social media adoption has always needed to be tempered by ROI reality. And as useful as each new communication resource proves to be, they are after all, merely tools to leverage our physical efforts, not eliminate the basic human need for interacting in person. Consider this story:

A sales manager (whose gray hair was not premature) noticed the sales volume of one of his rookies was below budget for the third consecutive month. Of course, he had questioned the numbers previously but had allowed his better judgment to be swayed by plausible explanations. Now there was a downward trend.

Upon more pointed probing, the manager discovered the reason for loss of production: too much electronic contact and not enough face-to-face. The rookie was relying too heavily on virtual tools and missing opportunities to meet with customers in person.

It turns out lack of training and rubber-meets-the-road experience left the rookie uncomfortable and unprepared to ask for and conduct face-to-face meetings, like proposal presentations. Consequently, he wasn’t benefiting from how the success rate of growing customer relationships can increase when certain critical steps are conducted in person. This manager immediately developed a training program that established standards for how and when to integrate all customer connection tools, including the face-to-face imperative.

If your sales could use some help trending upward, perhaps your salespeople need training to get in front of prospects and customers, particularly at the critical step of gaining an initial meeting. Like the manager above, you may need to establish specific and measurable standards for when face-to-face meetings should take place.

There is one connection option that has borne witness to all of the others and continues to be as powerful as ever: face-to-face.

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Check out my interviews below with other Braintrust members about face-to-face communication on The Small Business Advocate Show®

Nothing tops face-to-face when communicating with employees - with John Dini

Face-to-face is still the original social media - with Joanne Black

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