SucceedAsYourOwnBoss.com

Archive | Cash Flow & Finance RSS feed for this section

5 Things Wrong With Your Business Plan

by Melinda Emerson on November 7, 2011 in Before You Start, Branding & Marketing, Cash Flow & Finance

If you’ve taken the time to develop a business plan for your start-up business, you are on the right track. You have a roadmap that will help you with decision-making in your new enterprise. Take the time to be sure your business plan doesn’t contain any of the following shortcomings that will prevent your business from being effective. If you need help, check put my three part series on how to write a business plan for even more advice.

You haven’t researched your market. Many business owners don’t have enough information about who is buying their products and why. You need to find out who your ideal customers are, what their income is, what their buying habits are, and how they make purchasing decisions, for a start. You can do this by conducting surveys or polls online, interviewing people you consider potential customers, and searching for existing data on your demographic. Organizing the results will give you a clear picture of your customers’ perspective. This is an advantage when you develop messaging and begin to “talk” to them. All public relations and customer communications should center around customer pain points.

You haven’t researched your competitors. Know who your competitors are and stay up to date on their activities not only helps you make strategy decisions, it is a learning experience as well. You should know who has the best quality product or service at what price and who has the least, what customers are saying about the company, any financials made publicly available, and what kind of marketing or advertising they do. As you follow your competitors’ movements, you will be able to observe the rewards and consequences of their decisions on many levels, and adjust your own strategy to expand, advance, or target your market in new ways.

You haven’t planned for growth. A business plan is an action plan. It’s hard to motivate yourself, your employees, and your investors with research and projections. Be sure your plan outlines an actual plan for at least one future scenario. I say at least one because you should make plans for factors beyond your control that may derail your first plan.

You don’t know your numbers. Running a business is all numbers. Sales projections, production yields, profit estimates and more can swallow the heart of a business plan: the viability of your business model. Don’t get so focused on month-to-month numbers that you lose sight of whether your business idea, operations, and strategic decisions will allow those numbers to be actualized.

Your business plan is not up-to-date. If your plan is outdated, you will not be able to use it to run your business. Most business plans are created before launch. When your new business meets the real world, however, you often need to make adjustments that aren’t incorporated or reflected in your written plans. If you haven’t looked at your business plan in a while, ask yourself why. Is it because you’ve made so many changes to daily operations, or your numbers don’t correlate with what’s on paper at all? Take the time to sit down and go over your business plan once again and decide whether you need to make changes or make a new one that will better reflect your business’s current direction.

Do you have any other common business plans mistakes for small business owner?

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of Quintessence Multimedia, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine named her #1 woman for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog http://www.succeedasyourownboss.com Melinda is also bestseller author of Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works.

Comments { 7 }

How to Generate Revenue for Your Small Business

by Melinda Emerson on November 1, 2011 in Branding & Marketing, Cash Flow & Finance, Grow Your Business

Most people know they shouldn’t attempt to take on a mortgage without having some way to pay for it. Yet small business owners do something quite similar every day. How do they do this? Some small business owners focus on running the business before focusing on generating the leads that fund the business. Sure, every business needs money to stay open, but without building a strategy to funnel the revenue into the business, the foundation is shaky at best.

Just like some new homeowners take on more mortgage than they can afford, eventually it catches up to them. They are then forced to find more money or a smaller home. After a few years, the initial rush of the business wears off leaving a gaping hole where lead generation would have been. Small business owners may have quick sales in the beginning but without a long-term lead generation plan, they will go bankrupt. The cash flow a business needs requires a sales funnel. So how do you create that funnel? Below are a few tips to make lead generation a priority in your business without taking away from your other activities.

Create a list: Encourage people to opt in to your newsletter/free report or to a webinar/telesemiar. Developing a list of people who have opted in to your communications is quite possibly one of the best lead generation tactics you can implement. No, you shouldn’t buy lists or dump your contacts into your email newsletter program. People need to sign up by themselves. So incite them to do so. Host a free webinar or offer a free special report. Just offer them something. Taking action is better than perfecting the freebie.
Devote a set amount of time each week to lead generation. Customer needs change. Industries change. Consumer expectations change. Client budgets for your products and services may dwindle. So you need an ongoing plan for lead generation. Set aside time each week purely for lead generation activities. This could be list building activities social media marketing, warm calling, in-person networking, and many other activities. It’s easy to get caught up in your current client work, setting time aside for lead generation helps you bridge the gap between hunting for new business while producing the work you already have.
Build leads offline. Network, network, network. Have I mentioned networking? It’s a great way to build leads. Attend luncheons and business breakfasts to meet new people and expand your circle. Since your network of contacts will be in a constant state of flux, it’s important to keep adding to it. Some people will filter out, so replenishing is critical. Remember to tie your offline activities to your online activities, meaning connect to them on LinkedIn. Mention your e-report or other freebie on your business card. Direct people to a squeeze page on your website where they can sign up for your webinar.
Accepts “nos.” Getting a “no” is better than being stuck with a “maybe.” With a “no” you can move on to the next lead. Getting stuck with false hope maybes will, “bankrupt your business.” Building in registration deadlines for webinars and teleseminars encourages action. Promoting your reports and newsletters with some mystery encourages people to sign up to find out the punch-line. Demonstrating scarcity, a limited number of copies of a book to hand out, for example, encourages people to take action now. These tactics also weed out anyone who simply isn’t interested.
Make lead generation a priority. It’s easy to stop spending time each week on sales activities. But remember, quick cash creates a false sense of security. Quick cash burns out fast too (if you don’t first!). Build your business the right way even if it means saying no to work that doesn’t fit your business model. There are no shortcuts to success.

Lead generation is one of the most important things you can do to build and sustain your business. Focusing on working in your business instead of on your business will keep you from achieving the profit and longevity you seek. Focusing create quality content that will attract your target customer. Building quality leads into your sales funnel is what will make your business stand out and help you avoid sleepless nights.

Do you have any more ideas to share about lead generation and building a sales funnel?

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

By day Morgan Leu Parkhurst helps individuals put the pieces of their marketing puzzles together. By night she teaches
marketing communications to aspiring entrepreneurs. Reach her atwww.sharpmindmarketing.com or on Twitter at @Morgan_LP.

Comments { 2 }

5 Things Every Entrepreneur Must Do Each Day

by Melinda Emerson on October 17, 2011 in Business Inspiration, Cash Flow & Finance, featured, Grow Your Business, My Recommendations

Meditate— The worst thing you can do for your business is start each day in a race. I am strong believer in thinking about your day before you jump into it. I start each day in prayer before I leave my bed. I find that I am able to keep a positive disposition throughout my day regardless of what happens as a result. Years ago, Oprah Winfrey featured a book on her show called Simple Abundance; A Daybook of Comfort and Joy by Sarah Ban Breathnach. In it, she provides daily lessons about the concept of peace, joy and gratitude. This is a great book that I have used over 10 years to stay centered. If you start your day thinking about what you are grateful for it’s much easier to keep perspective when things go wrong. Running a small business involves 10 or more jobs at one time. Do yourself a favor, slow down and mediate on something before each day starts.

Know your cash flow situation– Cash is King! You have to know what your cash flow is, every single day, or you could lose your business. You should run your business based on a 30-day cash flow projection. You need to know how much money is coming in and what money needs to go out daily. You also need to stay on top of what invoices need to go out, and what the payment procedure is for each of your clients. Start collections procedures the first day after your money is past due. Never hesitate to call your client or the bank to get clarity about your cash flow situation. No matter what accounting software you use or what bookkeeper you hire, as the owner of the business you must know your cash flow situation every day.

Set aside 1 hour a day for business development– Work on getting in front of someone who may buy your product or service every day. Sales is the life’s blood of your business. Each day you must conduct business development activities in order to stay ahead of the competition. You can make calls, write emails, send thank you notes, Connect with new connections on LinkedIn, search for conferences and trade shows to attend, develop signature content, use social media to build relationships as lead generating activities. You need to make it a priority each day to spend at least one hour generating new business.

Follow-up with 3 three existing connections– People do business with people they like, know and trust, but you must nurture those relationships. Reach out to existing customers you haven’t spoken too in a while. Give three recommendations on LinkedIn. Send a lengthy personal note on Facebook. Make three calls or send follow-up notes with an article your read in the New York Times or Washington Post over the weekend. You will spend a longer time on these contacts, but they are further down your sales funnel, so they are worth it.

Get your plan together for the next day– One of my other favorite books is the 7 Minute Difference by Allyson Lewis. In this book, she says you need to do 5 things before 11am each day and anything else is a bonus. I love this and I do this every day. I make my list of the five things at the end of each day so I have a game plan for my day each morning. This, by the way, is also how I sleep well at night.

Do you have any suggestions for the daily priorities of a small business owner?

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of Quintessence Multimedia, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine named her #1 woman for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog http://www.succeedasyourownboss.com Melinda is also bestselling author of Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works.

Comments { 40 }

Managing Your Personal Credit and Your Business Credit – #SmallBizChat QA

by Melinda Emerson, #SmallBizChat on October 13, 2011 in Cash Flow & Finance, Q & A Interviews, SmallBizChat

Every week as SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wed on Twitter from 8-9pm ET. This is excerpted from my recent interview with Iris Carter @idCarter. Her company, Corporate Fast Track, helps small business owners separate their personal credit from their business credit. Iris Carter is an accountant and IT professional with an in-depth understanding of debt negotiation, business credit, loan packaging and managing your banking relationship. She specializes in providing sound financial strategies to small business owners that will maximum funding opportunities for their businesses. http://www.corporatefasttrack.com

Smallbizlady: What does it mean to separate personal credit from business credit?

Iris Carter: Separating your personal credit from your business credit means that you formally establish business credit. Any credit cards, loans, and/or lines of credit that pertain to your personally are listed with the 3 major credit bureaus Experian, Trans Union and Equifax. Establishing business credit means any credit cards, loans, and/or lines of credit that you are using for your business would be listed in the business bureaus such as Dun & Bradstreet, Experian Business and Equifax Business. When you run a personal credit report, you will see no evidence of any of the creditors you use on a business basis.

Smallbizlady: Why is it important to separate my personal credit from my business credit?

Iris Carter: You need to separate your personal credit from your business credit for several reasons. The first has to do with comingling funds. For accounting purposes you need to keep business credit separate to be sure to take advantage of all tax benefits afforded you. The second most important reason is that your personal credit has a credit score. This score can help you acquire things you want in life or it can hinder you depending on how low or how high the score is. If for example, you have too much debt /credit on your personal credit report, this can hurt your scores. You don’t want add business debt on your personal credit, especially if the debt/credit belongs to your business. This will increase your debt ratio and lower your personal credit score. Other creditors can also lower your available balances, and even your insurance rates may increase. Your business is suppose to be a separate entity from you, standing on its own.

Smallbizlady: How to do you establish business credit?

Iris Carter: The only way to establish business credit is to start by separating your personal credit from your business by incorporating your business and getting a federal ID number for your business. Then you want to apply for credit in the name of your business.

Continue Reading →

Comments { 1 }

10 Tips To Recession Proof Your Small Business

by Melinda Emerson on October 10, 2011 in Branding & Marketing, Cash Flow & Finance, Customer Service

Sponsored Post

If you are tired of hearing about the recession or the potential of a double dip recession due to foreign markets crashing now, Listen up. It does not matter. Recession or not you need to run your business well. You need to be an agent of convenience for your best target customer, manage cash flow with military precision and pay attention to the trends in your industry. This is a perfect time for an aggressive small business. No matter what your business does, if you build a better mousetrap, the world will beat a path to your door. In order to beat the recession, you must get smart about your marketing and business operations.

Here are 10 tips on strategic marketing and cash management to recession proof your small business.

Keep marketing. Do not be tempted to cut or eliminate marketing activities. This is no time to cut back on marketing. If you can’t afford a full-blown marketing campaign, pursue low-cost options such as social media marketing, webinars, news releases, e-mail blasts, blogging, and online newsletters. Be sure to keep your marketing activities going at least six months so that you can track your rate of return.

Develop 30-day sales goals. Do not focus on sales activities beyond 30 days. You should break down how many sales you need to close each month to meet your revenue goals. Determine how many meetings, calls, emails and blog posts you need to have, make, send or write to generate your target sales. You must keep the sales engine rolling in your business. You should be doing at least 60 minutes of sales cultivation activities per day.

Cut expenses and track cash carefully. It is extremely important for you to understand your monthly burn rate and your cash position. Determine where you can cut costs, and make sure on a weekly basis that you understand what money is coming in. As you cut costs use this formula, for every $2 dollars you cut in business expenses, invest $1 into your marketing efforts.

Start collections at 30 days past due. The days of waiting 45-90 days for payments are over. You need your money now. Once a client gets to 30 days past due, get on the phone and track down the accounts payable manager for an update. Be sure you are set up to take credit cards, you may get paid a lot faster.

Improve communications with your customers. Have quarterly face-to-face meetings or lunches with your top customers. Understand their biggest business challenges and look for ways you can help even if that doesn’t involve more direct business for you. Consider keeping your fees the same for long-term customers if they are really having financial difficulty.

Add value, not price. Continuously adding value to your and services is the way to get repeat customers and new business through referrals. Adding price without value is a lose/lose proposition. You may get the reorder, but your client will start looking for a replacement vendor.

Under Promise and Over Deliver. Excellent customer service is the number one way to beat the recession. If you do a great job and your customers love working with you, your customers will become an unpaid sales force for your business. If do great work, are highly responsive if there’s a concern, make follow-up calls, send thank you cards, throw in little extras all that shows you care. It’s also the best way to encourage your customers to refer you more business. Be known for delivering great products and services. Do not treat your customers like you are doing then a favor.

Network, network, network online and offline. People do business with people they like, know and trust. You need to make sure people know who you are, what you do and how to do business with you. You want to be top of mind when an opportunity presents itself. One of the best ways to so this is using social media. You can network online without being considered spam. Use Twitter and Facebook Fan Pages to give out helpful advice. Consider updating your LinkedIn profile regularly with updates on your business and/or any signature content such as blog posts. When you meet a new contact, online or in person think solutions for them first. Successful networking is all about give to get.

Consider adding staff. One good thing about a recession is there are lots good people are on the market looking for a job. You could pick up some quality talent right now that you could not otherwise afford. Consider hiring a salesperson and pay them commission only. Make them kill what they eat. Also be sure you think about exact what target market they will focus on and how success will be measured. If you have never hired an employee here’s a recent blog post that will give you some tips on the interview process.

Call the bank before things great critical. Good relationships are made in hard times. Regardless of your business situation, you need to communicate with your bank sooner rather than later. The bank does not benefit if you go out of business, so stop the denial and negotiate better terms with your bank.

Last week, I spoke with FedEx Office^® during a live Tweet Chat #FedExSmallBiz about ways to recession proof a small business. Check out the transcript from part one of their Boost Your Small Business Tweet Chat series.

Do you have any more ideas on how to recession proof a small business? Your idea could be worth $50 bucks.

@SmallBizlady will offer two $50 gift cards for two more great ideas to recession proof your small business. To be considered, post your comment on this blog post until 10pm ET Wed Oct. 12, 2011. Winners will be announced on Twitter on Friday, Oct. 14, 2011. FedEx Office has no involvement in the selection of winners. This is sponsored by @SmallBizlady.

Disclosure: FedEx Office compensated me to write this post and participate as a small business expert during the FedEx Office Boost Your Small Business Tweet Chat program. FedEx Office also provided the $50 gift cards. The ideas in this blog post are mine and not ideas or advice from FedEx Office.

About FedEx Office

FedEx Office (formerly FedEx Kinko’s) has the world’s largest retail printing network, providing access to printing and shipping expertise with reliable service. The company’s network of more than 1,900 locations includes 1,800 in the U.S. and features FedEx Office Print & Ship Centers, FedEx Office Ship Centers, FedEx Office Signs & Graphics Centers, and centralized production centers. Services include copying and digital printing, professional finishing, document creation, direct mail, signs and graphics, computer rental, free Wi-Fi access, FedEx Express and FedEx Ground shipping, and more. In addition, the company offers the award-winning FedEx Office® Print Online solution, an online printing application for business and personal printing, at home, at the office or on the go. Products, services and hours vary by location. For more information, please visit www.fedex.com/office.

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of MFE Consulting LLC, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine recently named her one of the Top 20 women for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog www.succeedasyourownboss.com Melinda is also the author of the national bestseller Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works. (Adams Media 2010)

Comments { 16 }

Affiliate Marketing the Right Way

by Melinda Emerson on October 4, 2011 in Cash Flow & Finance, Grow Your Business, Guest Articles

Have you been the recipient of communications from affiliate marketers or web-based entrepreneurs? Many of you have created or signed up to participate in affiliate programs. The government considers your affiliate activities to be a business activity and has a few things to say about what you can and cannot do. If you’re new to the game of affiliate marketing, it’s best to set up your program right the first time around. Here are action steps for ensuring you’re marketing your affiliate program the legal way.

What is An Affiliate Marketer?

You act as a referral source for another business for compensation. Or you get a percentage of each click-through from your site to another site.

For example, if I sell baby clothes and seek out a really popular mommy blogger to put a link on her site, and she does so for a percentage of each click-through (or purchase) to my baby product site, then I am a merchant and the mommy blogger is an affiliate marketer.

How are Affiliate Marketers Successful?

You must have a ton of traffic to your website from your target customer.

Associate only with good affiliate marketing programs that offer helpful information or quality products/services to your target audience.

Look for affiliate programs with a reputation for paying high commissions on time and providing excellent customer service to the end buyers, not just their affiliates.

Only promote products or services that you would actually buy. Linking to an affiliate marketing scam will eventually damage your online brand.
Do you homework to make sure you are providing legitimate value to your loyal web visitors.

Keeping Your Affiliate Program Legally Compliant.

In 2007, several government entities published rules to regulate the activities of affiliate marketers. The Affiliate Marketing Regulations, issued by the Federal Trade Commission (FTC) and the Federal banking agencies, generally require a company to provide a notice to consumers and an opportunity to opt out before an affiliated company can use certain information for marketing purposes. The affiliate marketing notice is in addition to the privacy notices already mandated, and would be a second required notice and opt out opportunity.

What Must I Do to Comply?

Get permission from the customer in advance.

Ask the customer if you can share their information with your affiliates BEFORE you share any information.

Use an opt-out feature.

Most email marketing programs offer an opt-out feature. You have to give your customers the opportunity to decide they don’t want their information shared with your partners.

What Should My Opt-Out Include?

It’s best to keep it simple. Try something like–

“Click here to opt out” or “Enter ‘Stop Emails’ in the Subject Line and hit ‘Send’”

Avoid these not so simple options–

“Print out this notice, fill it out and send by mail within 14 days” or “Enter your username, password and click here, there and everywhere to get to the opt-out page.”

There’s truly nothing more frustrating for a customer (and potentially illegal for you) than a complex opt-out process. Make it simple, and your customers will appreciate it and may even return later.

What Content Should Include an Opt-Out?

Remember, opt-out policies are not just for e-newsletters. Coupon offers, daily deals, infrequent updates, and anything else communicated to the consumer via an affiliate (or the merchant, of course), should include an opportunity for the consumer to opt-out in advance.

The government is not interested in completely raining on your affiliate marketing parade. There are a few things you can do without using an opt-out.

No Opt-Out Necessary When…

You had a pre-existing relationship with the customer

The customer initiated the communication or the Customer requested the solicitation

Include a Renewal

Give the customer an opportunity to renew their opt-out preferences at least every five years.

Do the consumers need to know that I’m an affiliate marketer?

Absolutely! Anytime you receive compensation (money, products or other freebies) of any type for providing access to a product via links on your site, product reviews or any other method of product promotion, then you need to tell your site visitors that you are being compensated for doing so.

Of course, you can also remind them that your reviews and opinions are based on your personal experience with the product (if that’s the case, and it should be…), but nevertheless, you must let them know so they can decide whether to go forward.

Three Steps to Legalize Your Affiliate Program

Strive for transparency. I imagine that’s a good rule in business, but definitely when it comes to sharing your customer’s information. Disclose all relationships and let you customers know and make the decision for themselves.

Err on the side of being overly generous with your opt-out policies. Don’t force yourself on your potential customers. Instead, give them a measure of choice in the relationship.

Keep it simple. Any opt-out procedure should not require a great deal of time or energy on the part of your customers. Make it easy to no longer hear from you. Keep it clear and to the point.

If you have a great product or service, then your customer base will grow over time, and you don’t have to engage in any sketchy tactics to get their business or email address.

Disclaimer: Any and all information contained in this post is shared for information purposes only. There is no attorney client relationship created between the author, reader, and any third party by the creation and sharing of this content. For more information on the federal regulations on affiliate marketers contact The FTC Bureau of Consumer Protection, Division of Privacy and Identity Protection, can be reached at (202) 326‐2252.

Shannon Harmon is a writer and communications consultant with Jones Harmon Communications, Inc. She helps companies around the globe create effective written content for business growth. As a licensed attorney she also publishes valuable legal information for web-based entrepreneurs via ibusinesslegal.com. If you have questions about your writing strategy or communications needs, she always welcomes emails at shannon (at) jonesharmonwriting (dot) com and will provide a thoughtful response to your inquiry.

Comments { 1 }

How to Get Corporate Sponsorship for Your Small Business

by Melinda Emerson on September 22, 2011 in Cash Flow & Finance, Q & A Interviews, SmallBizChat, Telesummit

Every week as SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wednesday on Twitter from 8-9pm ET. This is excerpted from my recent interview with @anisharkeeys. Anisha Robinson Keeys is the Principal Officer of Best Practice Fundraising. With 14 years of nonprofit fundraising and marketing experience,she has raised over $52 million dollars in the areas of youth and women’s empowerment, disaster relief, arts, and health care. Learn more about Anisha at bestpracticefundraising.org.

Small Biz Lady: What does it mean for an organization, brand or person to get sponsored?

Anisha Robinson Keeys: Sponsorship is a mutual business proposition that offers something in exchange for a financial commitment from a corporation. Corporations get a return on their financial “investment,” enhance their profile, associate their brand with a cause or attract customers who support that cause. Sponsorship typically involves a contractual relationship between the non profit and the corporate sponsor

Small Biz Lady: How do you even get started pursuing sponsorship?

Anisha Robinson Keeys: Getting funding from corporations may be a great opportunity for your organization to increase your budget but– you should never haphazardly create a corporate sponsorship program for the sake of filling a budget deficit Before pursuing support from corporations, you first need to know your organizations goals, and then ask and answer these questions:

What is your organization trying to achieve?
Can you effectively tell your organizations story?
What value could your organization provide to a prospective corporate sponsor?
What impact could a corporation make by partnering with your organization?

Continue Reading →

Comments { 1 }

5 Finance Secrets to Make Your Small Business More Successful

by Melinda Emerson on September 13, 2011 in Cash Flow & Finance, Grow Your Business

Being an expert in finance is not usually a top priority for someone starting or running a small business. Here are five tips to make sure you’re handling your finances according to best practices:

1. Record-Keeping

There are two main reasons to keep track of the finances of your business. First, you need to maintain compliance with government and other regulatory agencies, like filing tax returns. Second, you need to use the information to measure your performance to manage the day-to-day cash flow of the business as well as find ways to improve your business.

Rather than learn how to do bookkeeping, buy an accounting program, and learn how to manage the detailed transactions of that system, start-up businesses should look to outsource their accounting to an outsourced bookkeeper who updates the books once or twice per month on their software, preferably hosted so you can access it whenever you like. You can often get this done for $200 or less per month.

2. Banking Relationship

The last time you walk into your bank should be when you set up you business bank account. Utilize online technology to do everything else, and you’ll save a lot of time and hassle. There is certainly some value in building a more personal relationship with your bank, but that only comes in handy if and when you need a loan.

3. Customer Payments

Make it as convenient as possible for your customers to pay you. Accept checks, credit cards, EFTs, and any other way that makes it easy for your customers to pay. Any barrier your customers face to figuring out how to pay you will result in lower sales and even lower collections. Stop worrying about the costs of some of these services and accept them as a cost of running a good business.

4. Taxes

Please pay them, and pay them on time. The government and other agencies are the wrong institutions from which to borrow. They charge huge penalties, usurious interest rates, and they usually have stronger enforcement rights that allows them to price any corporate or LLC veil you’ve put in place to try and separate your business and personal affairs.

5. Benchmarking

Do not operate your business in a vacuum. What are your competitors doing? How long does it take for them to collect from their customers? What are their gross and net margins like? How do you compare? You can get this type of competitive information and more from your bank or from other online resources and trade associations specific to your industry.

Ken Kaufman is the author of Impact Your Business: An allegory of an entrepreneur’s journey to clarity, cash, profit, family, and success http://cfowise.com/impact-your-business. Ken, an award-winning CFO, has over a decade of experience helping small business owners and entrepreneurs attain the clarity they need to maximize their financial success. His has credited with creating the Six Scoreboards Every Business Needs. In addition to serving as an outsourced CFO to eleven entrepreneurial ventures, Ken writes regularly for American Express OPEN Forum and teaches New Venture Finance at a local university.

Implementing these five things will put you on the path to building a financially healthy company.

Comments { 4 }

Do you have a Bank or a Banking Relationship?

by Melinda Emerson on August 21, 2011 in Become Your Own Boss Tips, Cash Flow & Finance, Grow Your Business

Many business owners have a bank, but what you need is banking relationship. Entrepreneurs with a bank just make deposits and withdrawals. Business owners with a banking relationship know the branch manager, the business banker and the head teller at the bank they use. The business banker has seen your business plan and is aware of any big contracts or awards that the company has received. The head teller knows you so you can deposit a check as cash based on your reputation. Why is this relationship important?

As a business owner, eventually you will need money. Once you have a track record in business with positive activity on your balance sheet, you can consider approaching a bank for a business line of credit. Business cash flow tends to be uneven; seldom do revenues and expenses arrive in a timely fashion and sometimes a short-term line of credit is just what you need. The problem could be a pre-season inventory purchase, an unexpected machine breakdown, or a delay in getting a payment from a big client. Cultivating a positive relationship with a bank prior to having a need for a line of credit is key. It could mean the difference between success and failure. Here are some points to consider:

Look local. Look first for a local bank that can address your needs. Preferably, deal with a bank with which you already have a personal relationship history. They will have a pretty good idea of who you are and it will give you an edge in creating a new business relationship. Visit from time to time so people know your face. Use these visits to keep senior-level bank personnel up to date on your business activities. If you don’t have a personal bank, look for institutions that focus on loaning to neighborhood or women-owned businesses, etc.
Do your homework. Know your credit history before you go for a loan or line of credit. In a tight credit market, it is essential to keep your credit score as high as possible. Banks will only make loans to clients with pristine credit. Even the SBA will not support your business if your personal credit score is below 650.
Be prepared. Banks will ask a ton of questions about your business plan, loan requirements, collateral and strategy for repayment. When applying for a bank loan, remember that 90 percent of the bank’s decision to loan is based on two numbers: your cash flow and current net worth. The remaining 10 percent of the decision is based on such items as credit history and continued business viability.
The importance of cash flow, defined as the difference between cash receipts and cash payments, it is a key indicator to your bank on how your business is doing. Your goal is to hold on to your cash as long as you can without getting a reputation as a business that does not pay its bills. You must make sure your business always has enough cash to function.
A word of caution. Make the decision to give a personal guarantee for your business loan only after you fully understand all the ramifications. You are now personally liable for the total value of the loan if the business cannot pay, regardless if the business is incorporated, a partnership, or a sole proprietorship. Banks may place liens against your personal residence as part of these guarantees and this can be done without your knowledge. Personal guarantees are a fact of life for the small business owner, so be prepared for them. But be certain you understand the worst-case scenario.
Get Help. Find your local Small Business Development Center (SBDC) or other small business non-profit that has a micro-lending program. Such groups often have loan packaging deals under $50,000 and more importantly, many have special relationships with financial institutions that will work hard to approve clients these groups send them.

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts.
As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of MFE Consulting LLC, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine recently named her one of the Top 20 women for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog www.succeedasyourownboss.com Melinda is also the author of the national bestseller Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works. (Adams Media 2010)

Comments { 2 }

Do-it-Yourself, In-Source, or Outsource Small Business Accounting

by Melinda Emerson on August 9, 2011 in Cash Flow & Finance, Grow Your Business

I have yet to meet a small business owner or entrepreneur who was excited to start their business exclusively so they could figure out how to do the accounting for it. We start businesses because of the problems we are going to solve for our customers. But we still need to keep track of the money-side of the business, the accounting of what’s happening in our business.

Do-it-Yourself

If you are generating less than $100,000 of revenue per year, it may make sense to keep track of your accounting yourself. Since you are involved in every day-to-day detail of your business, you may not even need to buy an accounting system and learn how to use it. But you shouldn’t try to do your taxes, so you’ll likely need to outsource this to a CPA each year by giving him or her copies of your bank and credit card statements with some detail about what each of the transactions was for.

Outsource

This option makes a lot of sense for most start-up and small businesses, and outsourcing the accounting functions can be very affordable. Businesses that are generating $100,000 to $500,000 of revenue per year can hire an outsourced bookkeeper to update the books once or twice per month and provide basic financial statements and other critical reports. By giving read-only access to your bank and credit-card accounts to your bookkeeper, they can quickly and efficiently keep you compliant and get you the basic information you need. Some outsourced bookkeepers will even have their own accounting software (meaning you don’t have to buy it) and they will give you access to it through the internet.

In-Source

Once your business exceeds $500,000 in revenue per year, it will likely make sense for some of the accounting functions to be done in-house. But those tasks should be the simplest and lowest cost items, meaning one of your employees could easily be trained to handle them. You will keep your outsourced bookkeeper in place to oversee this person’s work and perform some of their main duties, but you’re not paying the higher-cost bookkeeper to do it all.

Once your company exceeds $1,000,000 in annual revenue, you will be getting to a point where you may want to bring the bookkeeping function in-house with a full-time employee. Even in this scenario, it can still make sense to outsource some Controller and Chief Financial Officer (CFO) functions to keep your business on track.

Conclusion

Certainly the accounting needs of each business will be different, and that is typically determined by the business’ size, complexity, and trajectory. Taking those things into account, the right mix of Do-it-Yourself, Outsourcing, and In-sourcing can be put together to create the lowest cost but highest return scenario for your business.

Ken Kaufman is the author of Impact Your Business: An allegory of an entrepreneur’s journey to

clarity, cash, profit, family, and success http://cfowise.com/impact-your-business. Ken, an award-winning CFO, has over a decade of experience helping small business owners and entrepreneurs attain the clarity they need to maximize their financial success. His has credited with creating the Six Scoreboards Every Business Needs. In addition to serving as an outsourced CFO to eleven entrepreneurial ventures, Ken writes regularly for American Express OPEN Forum and teaches New Venture Finance at a local university.

Comments { 2 }

Increasing Your Online Sales Part 2

by Melinda Emerson on July 13, 2011 in Branding & Marketing, Cash Flow & Finance, Guest Articles

Last time, in Part 1 of Increasing Your Online Sales, we talked about 3 ways to increase your online sales, which had to do with building and managing your site properly. This post I’m going to share some great tools for doing testing yourself. I’ll also share some ways to collect information on your site and how to distribute your content better.

First, testing intimidates most small biz owners. It’s time consuming. It can be complicated. But these tools make it fairly easy and affordable.

Here are 11 free to low cost tools I’ve researched.

1. www.feedbackarmy.com
2. www.fivesecondtest.com
3. www.conceptfeedback.com
4. www.uservoice.com
5. www.usertesting.com
6. www.userfly.com
7. www.feng-gui.com
8. www.crazyegg.com
9. www.kissmetrics.com
10. www.usability.com
11. www.Clicktale.com

One last thing about design and testing, in general, whatever you want to be clicked, put it in the upper left corner. You can put it elsewhere, but so much research data, heatmaps, user studies, show people read in an F pattern and they scan the top two horizontal lines of the letter F first, then go down the left side. BUT, they start in the upper left corner. Hardly anyone puts their form or call to action right there. They put it to the right where it is less visible.
I’m not a fan of the so-called, Squeeze Page, where you give users/readers no choice but the back button to click out, but simplifying your copy and design to make it really clear is what I’m trying share here.

Create a way to collect customer information on your website

I’m amazed at how many companies don’t collect information. When they do, they have 20 fields they ask people to fill out. Stop. Research from MarketingSherpa and other expert firms show you should probably have only three to six (3 – 6) fields. Then, set up an autoresponder to immediately reply when someone completes the form. At the same time, have that autoresponder email a copy to the sales or marketing or customer service team to get someone engaged at your company. Automate as much as you can without losing the personal touch. I use Infusionsoft, but there are lots of webform companies out there and autoresponders like aWeber.

Distributing Your Content

Content is king, but location is queen and just about everyone listens to the queen… And the queen is keeping engaged with your customer’s problems, conversations, and challenges where they happen.

So, you start with your blog. Anita Campbell, well-known CEO and Publisher of Small Business Trends says you shouldn’t be a digital pauper living inside the castle walls of social media empires. You should have your own site, your own blog. Don’t neglect that. If one of the social media giants crumbles, where will you be?

After your blog content is consistent, then start publishing similar or excerpts of posts on Facebook and/or LinkedIn, then share those links on Twitter and at BizSugar. You can also publish your work on sites like Slideshare, Postling, and article repositories like ezinearticles, diymarketers, and many others. Create screencasts of some of your more educational content and share it on YouTube. The main goal is to use that content in different forms and point it all back to your blog or website.

Tell us how this series on increasing online sales will help you in your business.

TJ McCue is founder of TechBizTalk which does independent web-product reviews and offers a Simple Website package to help small business owners get online fast and inexpensively with a $99 website. http://simplewebsite.techbiztalk.com

Comments { 0 }

Increasing Your Online Sales Part 1

by Melinda Emerson on July 12, 2011 in Branding & Marketing, Cash Flow & Finance

Sales is about trust and transparency, right? With all the media conversations about how Twitter and Facebook are impacting small business owners, that may be obvious. But with all the discussion about conversation, don’t lose track of the direct paths to sales. Don’t get soft and focus on conversation for its own sake. You can be trustworthy and transparent and still be about the sale.

Just about every time I’m asked about the best way to increase sales on the web, these three points are always my initial answer. These are part of having a quiver full of arrows.

What are you asking your customers to do?

A clear call to action is essential. Are you telling your audience what you want them to do next? They don’t have to follow your request, of course, but you should take the opportunity to guide and be unafraid to say, “Click here…”

Rather than having a weak collection of copy or signage that never asks, never tells, never guides a busy, busy prospect, you should suggest what they might do next. Amazingly, people will often follow the directions. You don’t want to miss that opportunity.

This is going beyond the old marketing maxim of tuning in to radio station WIIFM – answering What’s In It for Me. That’s important, but you have to also tell them what you want them to do next. We sometimes spend so much time on bullet point lists of the benefits that we forget to share some simple courteous directions.

So the first little known tip is to change your website or landing page so that when a prospect lands there, he or she knows what to do.

Leverage Pay-per-click (PPC)

Second point — test out pay-per-click as another way to drive traffic to your site and business. Here are FIVE things about PPC and using Google Adwords:

Run short campaigns: 30 days or less. Running a shorter campaign duration means you’ll watch it closer and tweak it more often. I recently heard a Google small business spokesperson state that campaigns are most effective in the first 30 days.
Place lower bids so that you’re not showing on page 1. Why? One, you can better control the costs as you figure out how PPC works. If you’re paying someone else, well some of this won’t apply, but it might. You won’t show up on page 1 of the search results if you underbid, but you’ll show up on page 2 and, for some people, that’s good enough.
Use the Content Network. It is a less-commonly used approach, but takes more work. You can also run display ads in this part of the Google Ad network. Google also built a great tool for you and I to be able to build simple display ads.
Put a phone number in your ad URL. Hardly anyone does this, but it is a super low-cost way to get people to call you and in some cases they won’t click the ad, which reduces your PPC spend.
Build a custom landing page for each PPC ad, if possible. As part of your PPC, rather than try to revamp or rebuild or refocus your website, just build a custom landing page for each ad (hopefully you’re not running tons of ads). It is a faster way to get moving on your PPC campaign. You can then test these different landing pages by building two versions and leveraging another free Google tool called the Website Optimizer (free tool from Google).

Side note: Lots of small biz owners are testing Facebook ads in small bursts. I think its a great platform to test, but you still want to stay diversified. The real power in FB ads is that you can target down to a very focused audience or customer profile. One guy I read about did a test where he targeted to just his wife! And she missed the ad, which had a photo of their baby in it!

Analytics: Start Using It to Understand Your Website Visitors

Your website visitors reveal tiny insights into what they find useful and valuable. And the answers are in just about every site via Google Analytics (or some other default analytics program running on your server). Analytics is underused. Period.

If you don’t look at your analytics, you’re missing out on the data points that will help you improve your site, your content, and your sales. Every day you can have the analytics report emailed to you and save your self time and effort. Plus, it points to holes in your sales funnel. It points to places where people abandon your site and that allows you to fix the broken spots. It reveals more than most small business owners realize. I’m presuming that nearly every small biz owner reading this is using Google Analytics, since it is free.

Once you start understanding your data, you can build similar versions of the same page and test them one against the other (a/b split with the above-mentioned Website Optimizer).

You think that one page or one document or one photo will pull better than another? You load the simple experiment into Google’s Website Optimizer (and tie it to Google Analytics) and you have a little test running that over time will yield good insights into what your customers prefer. When you look at the data and results, do more of what achieved those results!

Closing Thought

In real life, you can assess how its going in a conversation with a customer by the nonverbal and verbal cues. In web life, you have mostly virtual data points. So you have to design your site with instructions that give your customer some “nonverbal cues” and then you have to test those cues with analytics.

But when it comes to traffic, you want to be as diversified as possible, so don’t just work on organic results (although it is super important) because if Google changes it algorithm (which it does frequently), you can watch your traffic plummet. So you need social media, you need pay-per-click, you need worth of mouth and maybe even printed materials or direct mail.

Powerful sales results are only possible when your quiver is full of different ways to nurture and encourage the sales conversation.

Do you have any tips to increase online sales? We want to learn about them below.

TJ McCue is founder of TechBizTalk which does independent web-product reviews and offers a Simple Website package to help small business owners get online fast and inexpensively with a $99 website. http://simplewebsite.techbiztalk.com

Comments { 0 }

The Minority Entrepreneur Accelerator Program Could Be Your Answer

by Melinda Emerson on June 8, 2011 in Become Your Own Boss Tips, Branding & Marketing, Business Inspiration, BYOB2011, Cash Flow & Finance, Customer Service, featured, Grow Your Business, My Recommendations, Social Media, Technology, Your Small Business

Comcast Interactive Capital, the venture capital affiliate of Comcast Corporation, one of the world’s leading media, entertainment and communications companies, today announced that is has partnered with DreamIt Ventures (“DreamIt”), the leading technology accelerator for entrepreneurs, to provide seed funding, training, mentoring and other benefits to five minority-led startups through DreamIt’s accelerator program. The partnership with DreamIt, entitled the Minority Entrepreneur Accelerator Program (MEAP), is Comcast Interactive Capital’s first investment initiative from the $20 million fund created by Comcast as part of the NBCUniversal transaction that is committed to expanding opportunities for minority entrepreneurs.

Comcast Interactive Capital and DreamIt are now accepting applications and will select five minority-led startups to participate in DreamIt’s three-month accelerator program taking place in Philadelphia this fall. The deadline for applications is July 8^th and the program will commence on September 9^th.

Kerry Rupp, Managing Director of DreamIt, said, “We are thrilled to have Comcast Interactive Capital as a partner and are looking forward to working with them. DreamIt is proud to provide assistance and opportunities to help entrepreneurs grow, and we know that Comcast will provide invaluable expertise and partnership to this process.”

MEAP will provide minority entrepreneurs with the opportunity to engage in an intensive, company-building experience. Applicants who are accepted into MEAP will be a part of DreamIt’s broader Fall 2011 initiative in Philadelphia and will be offered the opportunity to learn from, and be mentored by, recognized experts in marketing, brand building, business development, financial modeling, business plans, distribution and customer acquisitions. In addition, they will be provided with office space, working alongside the other startups selected and be provided with donated legal, accounting and administrative help. At the end of the three-month period, the startups will have the opportunity to pitch to venture capital and angel investors at a demo day in Philadelphia to secure further funding to create a sustainable business.

For details on how to submit an application for the Comcast Minority Entrepreneur Accelerator Program, please visit the DreamIt website atwww.dreamitventures.com/about/Comcast-MEAP.php.

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.

Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of MFE Consulting LLC, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine recently named her one of the Top 20 women for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog www.succeedasyourownboss.com Melinda is also the author of the national bestseller Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works. (Adams Media 2010)

Comments { 0 }

Cash Vs. Accrual Accounting

by Melinda Emerson on June 7, 2011 in Become Your Own Boss Tips, Cash Flow & Finance

Three Reasons Small Businesses Need to Know Both

While it makes sense for most small business owners to avoid the day-to-day details of accounting, there are two concepts about the structure of their accounting records that every business owner should understand. In fact, you may have already heard the terms cash-basis and accrual-basis from your tax CPA, banker, or others. After giving a quick explanation of both, I will present three reasons it makes sense to do both and the best way to make that happen.

Cash-Basis

There are generally two ways to report on the financial performance of your business–cash or accrual. Generally speaking, cash-basis accounting counts income and expenses when they flow through your bank account. If you invoice a customer today and the customer pays you 60-days later, you would recognize the income in 60 days, not today.

There is one main reason small businesses need to keep track of their finances on a cash basis–taxes. Most start-up and small business file their taxes on a cash-basis, primarily to avoid paying taxes on uncollected receivables that, in some cases, are never collected at all. For example, if your company has $25,000 in receivables due from customers at the end of your tax year, filing your tax return on a cash-basis means you don’t have to pay taxes on that $25,000 in that tax year. With a few industry-specific exceptions, every business must switch to paying taxes on an accrual-basis once it hits a certain size, usually $5 or $10 million in annual revenues (averaged over the last three years).

Accrual-Basis

In contrast to cash-basis, accrual accounting strives to recognize revenue and expenses when they are earned/incurred, having no correlation to when they flow through your bank account. If you ship your product today and send an invoice to your customer today, you recognize the income today, even if your customer waits another 60 days to pay.

This type of accounting follows what’s called the matching principle, which tries to match all costs directly related to generating revenue to the revenue it actually generates. This means that accrual accounting is actually a more accurate way to portray the performance of your company, which is one of the two main reasons a small business should keep their records on an accrual basis. The other reason is that it is the best opportunity for you to put your best foot forward with your bank. Cash accounting usually understates performance, whereas accrual shows how you are really doing.

How to do Both

So, we have one good reason to keep the books on a cash basis and two good reasons to follow the accrual accounting principles, which means you probably should do both. But how can a small business afford to keep two sets of books when it takes so much time and resource to just do it one way now. The answer is simple–you keep your books on an accrual basis, and then your tax CPA will convert your numbers to cash basis each year when he or she does your taxes.

Conclusion

While your tax CPA may encourage you to keep your books on a cash-basis only, he or she is incentivized to give you that advice. Knowing your true performance each month and being able to put your best foot forward with outside professionals is far more important and needs to be the highest priority when you decide on the accounting basis of the financial records your keep for your business.

Ken Kaufman is the author of Impact Your Business: An allegory of an entrepreneur’s journey to clarity, cash, profit, family, and success http://cfowise.com/impact-your-business. Ken, an award-winning CFO, has over a decade of experience helping small business owners and entrepreneurs attain the clarity they need to maximize their financial success. His has credited with creating the Six Scoreboards Every Business Needs. In addition to serving as an outsourced CFO to eleven entrepreneurial ventures, Ken writes regularly for American Express OPEN Forum and teaches New Venture Finance at a local university.

Comments { 1 }