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November 30, 2005
Small business Marketing for Smart Marketers
Are you a smart small business owner who puts marketing top of your list of priorities or are you a dumb small business owner who is educated but cannot see the wheat from the chaff?
Hopefully you're smart. Read this article just to remind you that smart marketers are the ones who are obsessed with adding value, usually in the form of cash in their bank accounts rather than business school theory.
Back in the 1980s, I agreed to help the owner of a small company grow his business. Within three years, it was the largest company in its industry.
By combining five key marketing strategies with kick-butt sales copy, we were attracting between 5,000 and 10,000 new customers every month. By 1988, we had more than 120,000 paying customers. Sales revenues and profits quadrupled.
At that point, my client decided to cash out - take his profits and retire - and asked me to help him sell his company. I created a 20-minute video and a comprehensive "company profile" to help attract prospective buyers.
The buyers - who paid top-dollar - turned out to be a team of three Rhodes Scholars with advanced business degrees from Oxford University.
Within a week after the papers were signed, the crackerjack marketing team we had built was placed under an oppressive bureaucracy: an "Executive Committee" made up of the new owners, their hand-picked CEO, the CFO, and the General Manager - none of whom knew one blessed thing about marketing.
Within days, we went from being obsessed with marketing to being infatuated with something called "Corporate Planning." Key marketers were sidetracked in day-long meetings - and, sometimes, week-long out-of-the-office marathons. Scores of crucial sales promotions were put on hold while the marketing staff diddled themselves silly with endless research and reporting tasks.
I, of course, went ballistic. I warned everyone who'd listen (at the top of my lungs) that de-emphasizing marketing was going to drive the company into bankruptcy.
That drew giggles all around.
"You're overreacting," said the new owners. "It's going to be just fine," chanted the Executive Committee.
It wasn't fine. Not by a longshot.
The flow of new customers faltered, then plunged. Our active customer file began shrinking. Sales to existing customers plummeted.
Finally, unable to make the new owners see the error of their ways, I fired them as a client. As I walked out of the office for the last time, I told the CEO, "Now I understand what being a Rhodes Scholar does for you. You'd have to STUDY to be this stupid."
I told the CEO that his company would be belly-up within six months. I was wrong.
He filed for bankruptcy 90 days later.
Moral: Smart Companies put marketing first.
Okay, I admit it. I'm a marketing chauvinist. (See Word to the Wise, below.) And it's not because I think we marketers are necessarily smarter and better looking than everyone else. It's because the only logical place for marketing is out front - leading the charge for your entire company.
It drives me nuts when executives who know nothing about sales and marketing mindlessly parrot phrases about "putting the customer first" - and then relegate the only people who actually talk to customers to an inferior position in the company.
Before the Rhodes Scholars showed up, my client had put sales and marketing first. And because their job was to respond to customers' desires and concerns ... it meant our customers were No. 1.
But the Rhodes Scholars and their preening "Executive Committee" wanted to be first - the masters of all they surveyed, at the pinnacle of the corporate pyramid. So they put sales and marketing in its place - under their thumbs, no more important than janitorial services or any other department in the company.
And by doing so, they turned my client's "Smart Company" into a dumb one in one fell swoop.
In a Smart Company, the Marketing Department exists at the top of the corporate pyramid. Armed with the freshest intelligence on the desires and complaints of prospects and customers, the Marketing Department directs...
. The development of new products and the production of existing ones...
. The scripting of the sales force and / or telephone customer service reps...
. The creation of sales promotions and the layout of the catalog and / or store...
. The shipment of products and the delivery of services...
. The management of the Customer Service Department, and...
Every other activity in the chain of events that begins with contacting a prospect or customer and culminates in the cha-ching of the cash register.
. In Dumb Companies, top execs fail to understand the supreme importance of sales and marketing - or, worse, see it as a "necessary evil." And their structure shows it. Marketers are kept under tight rein - slaves to multiple layers of bean-counters, bureaucrats, and other self-important gasbags who have long forgotten where the money in their paychecks comes from (if they ever knew in the first place).
Even worse, Dumb Companies make sure that marketers - the only experts in the company capable of boosting sales, revenues, and profits - are frozen into inaction and that crucial sales campaigns are delayed by corporate procedures requiring marketing-challenged morons at the top to approve their every move.
The CEO and top execs spend no more time or effort on sales and marketing than they do monitoring Human Resources, or any other department. Marketing is beneath them - something the weirdoes down on the fourth floor are responsible for.
In a Smart Company, every employee clearly understands that his / her job exists for one reason and one reason only: to help marketing sell more, more, more!
Accounting exists to ensure that sales and marketing has the financial resources it needs to attract maximum numbers of new customers and to boost sales revenues.
Human Resources exists to ensure that the Marketing Department has the best talent available and that supporting departments have what they need to help sales and marketing be more successful.
Information Technology (IT) exists to give the Marketing Department the daily reports it needs to monitor and analyze the effectiveness of its strategies and tactics.
The Legal Department exists to help marketers create promotions that are as effective as is humanly possible within established ethical and legal boundaries.
In a Smart Company, the business owner / CEO occupies not one, but two positions:
1. Leading the charge with the Marketing Department - setting goals ... monitoring key costs and response rates ... helping to innovate new products and sales approaches ... breaking logjams ... and providing the quick approvals needed to kick winning sales campaigns into overdrive.
2. Taking up the rear - constantly driving everyone down the line to make supporting sales and marketing efforts their No. 1 priority.
BOTTOM LINE: Dumb Companies think that the Marketing Department exists to sell products.
Smart Companies know that the only reason to have a product is to give the Marketing Department a vehicle with which it can attract new customers and produce revenues and profits.
My advice ...
If you own or run a Dumb Company, changing how you and your employees think about your business - the simple act of redefining it as a marketing business and ensuring that your corporate structure and procedures make sales and marketing No. 1 - is the first step to explosive growth.
If you're a marketing exec with a Dumb Company, you're never going to be as successful as your peers at Smart Companies. If you can't raise the company's IQ, pack your bags!
If you're a marketing consultant or copywriter for a Dumb Company, finding a better class of client will send your income skyrocketing.
Clayton Makepeace
Posted by David at 11:44 AM | Comments (0)
November 29, 2005
Small Businesses How To Increase Your Sales By Reducing Risks
If you run a small business you must learn how to reduce perceived risks or loose sales to your competition.
I had a costly experience in risk perception a few years ago when I was selling sales training programs.
I was introduced to the national sales manager of a large company in the computer field. They were looking for a program to use to train their entire sales team, and ours had been recommended.
The program I was selling had been used very successfully with other large companies overseas - and the sales manager seemed to really like it. But they were also considering another training program. One of the directors of the company had attended it and was happy with his experience. But it was a lot more expensive than mine - $200,000 more.
To my surprise, they decided to go with the more expensive program.
The problem with what I was selling was that even though it looked good (and was certainly far cheaper), it was perceived as being risky by the buying committee. It was risky, because no one in the company had actually attended it. In the minds of these business people, it was safer to pay far more and go with a proven product than try something new.
And that brings me to the purpose of this article.
For potential customers, there is a certain amount of risk associated with buying your product or service. And until you reduce this perceived risk, they will often "vote with their wallets" and spend their money with your competitors.
The number one rule with reducing perceived risk is this: "Everything counts."
In other words, everything you do or say when interacting with a prospective customer has an impact - positive or negative - on how risky they think it is to buy your product or service. Everything you say or do makes your customer think it's either more risky or less risky to do business with you.
Example:
Let's say you phone two trades people and leave a message asking them to contact you about their services. One trades person phones you back within one hour and the other one phones you back two days later.
The tradesperson who phoned you back in two days could be twice as good as the one who phoned you back in one hour. But because he took two days to make contact, you assume he is slow, sloppy, and not very good at what he does. You think it is more risky to do business with him simply because he didn't return your phone call promptly.
I had a similar experience a few weeks ago.
I wanted to buy a particular business program and found a company on the Internet that sold it. I sent a short e-mail asking a very simple question about it - and I never received a reply. So I automatically assumed that this company was too risky to do business with and decided to never spend my money with them.
I then e-mailed another business that had a version of this same program that was considerably more expensive - and received a reply within one hour. I happily gave them my money.
Here are some simple ways to reduce risk in the minds of your potential customers:
1. Reduce risk with testimonial letters.
The big question going through every customer's mind is: "Who else has purchased this product or service - and how did it work out for them?"
Testimonial letters from happy customers are a wonderful way to answer this question.
Example:
Many years ago, when I was selling advertising, I called on a real estate office in a small town. On the wall of the office were several hundred cards and letters from delighted customers. I read a few of them and thought to myself, "Boy, this company must be good. Look at all their happy clients!"
2. Reduce risk by having an excellent sales presentation.
Most of your customers will judge the quality of your product or service by the quality of your sales presentation. Just as they will judge the quality of medical professionals by how thorough their examinations are.
Example:
I discovered this concept by accident when I was selling sales training services.
A sales manager who bought my services referred me to her husband, who was a sales manager for another company. When I sat down with him, he told me that he knew very little about what I was selling.
However, his wife had told him that I was one of the best sales people she had ever met - and told him that he had to sign up with me. That was very flattering. But all I had done to make her (and other potential clients) think my services were good was get very good at my sales presentation.
3. Reduce risk by how you look and act.
Understand that customers often make decisions about the quality of most products and services based on tiny things. One of the things many customers will pick up on is how you look.
By "how you look," I mean everything that is associated with you. Your car, your place of business, your sales presentation materials, your clothes, your shoes, and so on.
If any of these things are not in keeping with someone who is good at what he does in your type of business, little warning bells will go off in your customer's mind.
For instance:
Is your presentation material neat and tidy or is it sloppy and messy?
Are your shoes clean and polished or are they dirty and scuffed?
Are there spelling mistakes in your written material?
These might seem like unimportant details - but remember that every one of them counts when you are interacting with potential customers. As far as they are concerned, it either reduces risk or increases risk.
If you have dirty and scuffed shoes, some customers will automatically think your product or service is not very good. First appearances have a powerful impact on the way people think about you.
What you want to do is examine every aspect of your appearance and how you act, and ask yourself, "In my customer's mind, does this reduce or increase the potential risk of doing business with me?" And if the answer on anything is "It increases risk," you need to do something about it. (Sometimes, it helps to ask people you trust if they can pick up on details about you that may be causing your customers some concern.)
Example:
When I first began selling sales training services, I had a pair of black sneakers that I wore to every sales presentation. They were very comfortable and I didn't think they had any effect on my sales.
However, a colleague who attended a presentation that I made to a group of 12 salespeople told me that four of the people spent most of the time looking at my black sneakers, rather than watching what I was doing. Needless to say, that was the last time I wore those sneakers to a presentation!
Graham McGregor
Posted by David at 1:58 PM | Comments (0)
November 24, 2005
Why UK Innovation And Entrepreneurship Could Be Heading In The Right Direction
Much has been written lately on the UK’s inability to develop innovative ideas that grow into global brands but this could now change…
I've been posting my views on the Financial Times web site in reply to Gordon Brown's statement on the subject of entrepreneurship and innovation and how vital this is to the future of the UK. Here's what I had to say on the subject starting with my first posting on 14 November 2005:
First Poting On The Call For Entrepreneurs
"Everyday I get 400 or so visitors to my website all searching for small business ideas. Of those who arrive, the majority is looking for government grant or small business finance. I point them towards Business Link, the DTI, and Local Enterprise Agencies, but they come back to my web site because they meet blank walls.
How on earth can Gordon Brown expect entrepreneurs to take their ideas and build businesses that create wealth for this country when many aspiring entrepreneurs cannot even navigate the first hurdle to starting a small business?I watch with envy at the American system for helping small businesses with grants, loans and Small Business Innovations Research funding.
The Small Business Administration (SBA) that's responsible for providing grant / loan funding operates within a legal framework and is empowered to champion all small businesses; every type of small businesses including those owned by ethnic minorities. The SBA is set targets and is evaluated on performance. Compared to the SBA and associated State structured funding agencies our system falls way short.
Not only that, entrepreneurs in the UK are confused about where to go for funding and whether they’ll even qualify.
Every week I receive announcements of yet another small US companies being granted Small Business Innovations Research (SBIR) funding that allows them to research and develop innovative technological and other products with the USA government as possible stakeholder.
When I read about our research grant scheme that is suppose to be equivalent to the USA's SBIR scheme I smile because I know there's no comparison.
Our scheme falls way short!
When I read about young Londoner's not wanting to start a business of their own, but would rather work in paid jobs because they are adverse to stress, I'm saddened because at the same time, young people in the USA are winning prizes for showing entrepreneurial flair and starting businesses.
If the Chancellor or Prime Minister in waiting truly believes that entrepreneurs are the key to Britain’s future my advice to him is "don't tinker with tax incentives, instead create an environment that supports, encourages and mentors budding entrepreneurs to build thriving businesses".
Here's my second posting two days later:
"Following my previous post on 14 November 2005, here's a classic example that illustrates why the Chancellor should concentrate on substance rather than tinkering with incentives like tax to encourage entrepreneurialism.
In his article on November 9, 2005 Jonathan Guthrie wrote an article with the headline: "Why Tax Credits Are For Business, Not Mad Scientists."
The salient point on which the article was based was the performance shortfalls of HM Revenue and Customs, and ignorance and inertia among companies on the R&D tax Credit scheme.
Apparently George, the Treasury Official who oversees tax credits for companies undertaking cutting-edge research and development spends his working hours in hope of receiving calls from companies that are interested in applying for R&D tax credits.
Ironically, Gordon Brown regularly trumpets the R&D tax credit scheme but the scheme has fallen short of its full potential largely due to administrative snarl-ups at HM Revenue and Customs and ignorance and inertia among companies that are eligible for the scheme.
There is suspicion by companies of the Revenue handing out money instead of its normal role of collecting money but the main concern for companies over the R&D tax credit is that of uncertain administration and the long waiting period (up to two years in some instances) claimants face in receiving their cash.
This is the reality of the R&D tax credit scheme!
In the context of encouraging entrepreneurialism among Britain’s innovative companies the R&D tax credit scheme should be restructured to encourage SMEs (Small and medium size enterprises), on similar lines as the USA’s SBIR scheme.
The scheme should also accommodate larger companies, but should be biased towards helping innovative SMEs, particularly technology type companies.
Clearly, if Gordon Brown wants to infuse in Britain a bias towards taking risks then he should recognize that fundamental changes are needed in all areas of government provision and that changes MUST involve business experts (SMEs and large companies) and not be left solely to the public sector."
And following the good news on 24 November 2005 that Gordon Brown will leave innovations funding to business instead of the public sector, here's my letter to the FT Editor"
---------------------------------------------------------------------
"Sir
A week in politics is a long time but following Gordon Brown’s recent statement that the future of the UK is dependent on entrepreneurs, who are the wealth creators, and the recent announcement to allow businesses to shape the Innovations budget, I can barely catch my breath.
Instead of tinkering with tax incentives to wow entrepreneurs, Gordon Brown it seems has been looking at what has been happening in the USA.
Instead of the R&D tax credit scheme being administered by HM Revenue with all its conflicts, uncertainties and poor performance there is now the prospect that entrepreneurs will be the rightful champions of innovation.
I watch with envy at the American system for helping small businesses with grants, loans and Small Business Innovations Research funding. While there’s no such thing as a perfect system, my hope is that we can finally create an environment where entrepreneurs with innovative ideas, especially those that are technology driven, will be encouraged to seek funding for their projects.
Everyday I point visitors who are seeking funding for their innovative ideas to Business Link, the DTI, and Local Enterprise Agencies, but they come back to my web site because they run into blank walls.
How on earth can Gordon Brown expect entrepreneurs to take their ideas and build businesses that create wealth for this country when many aspiring entrepreneurs cannot even navigate this first hurdle?
At last, there’s the real prospect that some of these companies could finally receive funding that could see them grow into global brands.
The challenges to our economy and way of life whether from of climate change energy shortages, caring for an ageing population, technology change cannot solely rest on the City of London, it must surely rest on people of vision who can transform ideas and, with financial support, create real wealth.
David Davis
Small Business Resource Ltd
www.2-small-business.com
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Finally, what about you, followng the announcement that funding for innovations should be administered by businesses, what is your view?
If you want to contribute to the debate go to the
FT's small business forum
Posted by David at 5:29 PM | Comments (0)
November 22, 2005
Small Business Loans For Energy Efficient Irish Small Businesses
Small businesses in Northern Ireland can now claim interest - free loans of between £5,000 and £2,000 following £2.8 million increase in government funding to help tackle carbon dioxide emissions.
The 'grant' is being awarded to the Carbon Trust, which was set up by the government to help it meet the UK's (includes NI) climate change obligations.
Wilfred Mitchel of the Federation of Small Business NI, said, "recent energy price rises have impacted small businesses and the interest free loans will help these businesses benefit from energy efficient equipment and the resulting cost savings
D Davis
Small Business Resource
Posted by David at 5:23 PM | Comments (0)
November 21, 2005
Small Business Development - Building Long Term Relationships Is Key
Buliding long-term relationships with customers and employees is key to developing a thriving small business that depends less on active efforts to sustain cash fow and profitability.
I once worked for a digital consultancy that developed web sites for UK and USA top 100 companies. The company's portfolio included some of the most prestigious companies in the world. But despite this valuable asset, the company was always struggling with to grow and to increase profits. Problem was: the company spent 90% of its time pitching for new business instead of building long-term relationships with its existing customers.
Here's another example of how important it is for you to build long-term relationships with your customers and employees:
DD is a bit of genius. When it comes to thinking about business, he has few peers. This natural gift has given him an advantage over his competitors. He can often find brilliant, money making solutions where others find obstacles.
DD makes a lot of money as a business development consultant. In all the years I've known him, there's never been a 12-month period during which he's made less than a million pounds. And I've known DD for 15 years.
So you'd think he was in the "too-rich-to-worry" category of wealth, wouldn't you? Oddly enough, he's not. He's still struggling to earn a living. In his fifties - still youthful but on the declining slope - he must work as hard to support his lifestyle as he did when I first met him.
This is not the way it's supposed to be. As you get on with your career, everything should gradually become easier. It should be easier to get the work done, easier to handle the problems, and easier to make the money.
So what is DD doing wrong?
In a nutshell: He is not able to develop productive, long-term business relationships.
This wasn't always apparent to me. I used to think that DD's problem was some version of attention deficit disorder (the modern psychological plague). While it's true that he has never been great at staying focused on one subject for any length of time, he could have overcome this problem by surrounding himself with people who could.
That's what a smart small business person does:
1. Identify what it is that you do well and put 80% of your efforts into doing that better. Make that skill your major contribution to your business. (In this case, coming up with marketing solutions has and would be LC's contribution.)
2. Identify what you do poorly and align yourself with people who do that well. (In DD's case, that would mean people who could handle details and follow through on projects that he initiated.)
When successful business people accept awards, they invariably thank their team. I used to think such gratitude was political. Now I believe it comes from the heart. Because to achieve anything of importance, you must not only possess a spark of genius and a ton of drive, you must also be smart enough to surround yourself with people who can do well what you do poorly.
DD is aware of his shortcomings. And he has attempted - many times - to find people who can help him build his small business. But, for some reason, those people never stay around very long. Instead, they stick with him till they have learned enough to make it on their own ... and then they seem to disappear.
That leaves DD in the worst possible situation: with a deflated small business and the unhappy prospect of having to find another potential superstar and start all over again.
If this had happened only once or twice, I could rack it up to bad luck on DD's part. But it's happened consistently for years. Which has led me to the inevitable conclusion that, despite his personal charm and intellectual faculties (see Word to the Wise, below), DD doesn't know how to maintain long-term business relationships.
Think of it this way: DD has spent his life as a high-income earner, but he's never built a small business. What is the difference? In a word, "equity."
In the context of this conversation, I think it is fair to say that one purpose of a small business is to establish equity. Equity is a form of wealth. It is stored value. The equity in anything (a business, a car, a house, etc.) is, roughly speaking, its net worth - the difference between what you can sell it for and what, if anything, you owe on it.
If DD had been able to train people to convert his talents and skills into products and services that other people could produce, his businesses would have equity.
But that's never happened. His small businesses continue to depend on his ongoing work to produce income. Almost as soon as his good people figure out how to do what he does, they leave him.
From DD's perspective, it may appear that his proteges keep "stealing" his equity from him. And there is certainly some truth in that. But the real problem is that DD lacks the skills to maintain long-term relationships with his key employees.
There is nothing I'd like better than to see DD sail into an easy retirement, with his proteges running his small businesses for him and sending him fat monthly cheques. That is not going to happen, however, unless he figures out what he's doing wrong - what is driving them away - and adopts a new strategy to keep them.
DD needs to study the theory of compound returns as they apply to his knowledge. Here, I'm talking about the effects of compound returns with people. DD never enjoys the benefits of compound returns on his relationships, because they don't endure.
That doesn't have to happen to you. If you want to become rich and continue to get richer and richer with less and less effort, make it a priority to not only find superstars ... but also to develop long-term relationships with them.
David
Small Business Resource
Posted by David at 11:42 AM | Comments (0)
November 18, 2005
Small Business VIOP
Small Businesses Would Be Crazy Not To Use VOIP Like Google Talk Free VOIP Service To Reduce Telephone Bills.
If you run a small business and you're not using VOIP (Voice Over Internet Protocol) to reduce your telephone bills then its time you give your customer service and debtors (receivables) collection staff a microphone and headset and get them to sign up to a free VOIP service like Google Talk.
Google Talk is a free VOIP service for individuals including small businesses. You can make free worldwide phone calls, not only that, you could use VIOP services like Google Talk to build good customer relations by staying in frequent touch, right from your computer.
Imagine, using VOIP like Google Talk would slash your telephone bills. If your business is international using Google Talk could save you thousands of pounds.
To Use Google Talk the first thing you'll have to do is to subscribe to Google's Gmail. Google Talk is a free add-in to Google Mail that provides text messages, free phone calls to everyone who is connected to the internet.
Setting Up Google Talk Is Easy
Follow these three simple steps And start using Google Talk;
1. Get a Gmail account. Setting up a Gmail account is free. If you don't have a Gmail account contact me and I'll help you get one.
2. After you have a mail account, simply download the Google talk program from Google's website.
3. Install the Google Talk program you downloaded onto your computer.
That's it you're ready to go.
Quick Guide To Using Google Talk VOIP Service
Google Talk will automatically start every time you log onto your computer (you can turn this feature off).
Click on the Google Talk icon to the right of your windows toolbar.
You'll see the Google Talk display and the status of people who you regularly communicate with. To display all your Gmail contacts simply right click and select Gmail contacts.
To Make Phone Calls Using Google Talk VIOP Service
1. Click on Google Talk "friend" whose status is shown as available, next click on the phone icon to start your call.
2. You should hear the ringing tone and if your contact is available they'll answer the phone.
3. When you're finished your call simply click "end call".
That's all there is to using Google talk to make free phone calls.
As the VIOP hots up small businesses and individuals who embraces the technology will be the real winners. Small business VOIP or VOIP services that's geared to businesses offer great possibilities to get close and "intimate" with customers.
D Davis
Small Business Resource
Posted by David at 12:26 PM | Comments (0)
November 17, 2005
Small Businesses Are Paying More For Banking
Small businesses are paying more for their banking three years after the competition Commission sought to end the complex monopoly of the big four banks says a recent Moneyfacts report.
The Moneyfacts report findings says banking now cost about £10 more each month on average for a small business.
Barclays Bank has a £3 a month standing charge since 2002, but this still puts it below National Westminster Bank's £5.75 a month. Other charges are levied for paying in cheques and cash - HSBC, for example charges for these services but did not three years ago - or setting up standing orders and direct debits.
The Competition Commission concluded in 2002 that the big four were operating a "Complex monopoly" and should either pay interest on small business current accounts or offer free money transmission services.
The fact that charges have risen while the big four are thought to have retained most of the market is likely to increase pressure on banks when the Office Of Fair Trading reviews the issue early in the new year.
"It could be that the banks are back to their old tricks", said Stephen Alambritis, of the Federation of Small Businesses. "We would urge Government to have another look at bank charges."
He said many companies were discouraged from switching to a better deal by the hassle and possible stigma involved. "The Government must ensure that switching happens within five working days and that should be mandatory. Switching also sends the wrong message to investors, accountants and the Inland Revenue.
But Alison Hopkins, managing director of small business at Barclays, said that at he average of £248 a year, her bank charges were now about a third lower than in the early 1900s and there had been an increase in competition. "Over the last three or four years the market share of the big four players has been eroded", she said.
Ms Hopkins added that the OFT should lift the restrictions placed in banks in 2002 and not consider any other measures. "Given that they were imposed, we have absolutely thrown our arms around them. It would be nice if they concluded that we embraced them. I'm not sure if there needs to be any sort of pricing remedy. We feel the pinch of competition day in day out."
That competition has come mainly from the two "challenger" banks. abbey and Alliance & Leicester, but both say the competition Commission's remedy in 2002 has only served to remove their competitive advantage. Alliance and Leicester said: "in the past couple of years we have been successfully growing our small business banking. However, the pricing regime put in place three years ago has made that harder."
John Brooks at Abbey agreed with Mr. Alambritis that getting small businesses to consider switching was vital to reducing the dominance of the big four.
D Davis
Small Business Resource
Posted by David at 3:50 PM | Comments (0)
November 14, 2005
Small Business Entrepreneurs Are Key To Britain’s Future
Everyday I get 400 or so visitors to my website all searching for small business ideas. Of those who arrive, the majority is looking for government grant or small business finance. I point them towards Business Link, the DTI, and Local Enterprise Agencies, but they come back to my web site because they meet blank walls.
How on earth can Gordon Brown expect entrepreneurs to take their ideas and build businesses that create wealth for this country when many aspiring entrepreneurs cannot even navigate the first hurdle to starting a small business?
I watch with envy at the American system for helping small businesses with grants, loans and Small Business Innovations Research funding. The Small Business Administration (SBA) that's responsible for providing grant / loan funding operates within a legal framework and is empowered to champion all small businesses; every type of small businesses including those owned by ethnic minorities. The SBA is set targets and is evaluated on performance.
Compared to the SBA and associated State structured funding agencies our system falls way short. Not only that, entrepreneurs in the UK are confused about where to go for funding and whether they’ll even qualify.
Every week I receive announcements of yet another small US companies being granted Small Business Innovations Research (SBIR) funding that allows them to research and develop innovative technological and other products with the USA government as possible stakeholder.
When I read about our research grant scheme that is suppose to be equivalent to the USA's SBIR scheme I smile because I know there's no comparison. Our scheme falls way short!
When I read about young Londoner's not wanting to start a business of their own, but would rather work in paid jobs because they are adverse to stress, I'm saddened because at the same time, young people in the USA are winning prizes for showing entrepreneurial flair and starting businesses.
If the Chancellor or Prime Minister in waiting truly believes that entrepreneurs are the key to Britain’s future my advice to him is "don't tinker with tax incentives, instead create an environment that supports, encourages and mentors budding entrepreneurs to build thriving businesses"
David Davis
Small Business Resource
Posted by David at 2:14 PM | Comments (0)
November 4, 2005
Life's Ups And Downs Of A Small Business Entrepreneur
As the working week grinds to an end, I cannot help but reflect on the ups and downs of being a small business entrepreneur.
Like most weeks, you start out each Monday morning wishing you had another day to catch up on chores or ease your tiredness. You go through the motions of getting ready and traveling to work. Perhaps, you belong to the work from home "crowd" who stay in their pajamas while eventually deciding to sit at the computer, click you mouse, check your emails and most important of all, check how much money you made while you was fast asleep.
My week has been a mixed bag. It's started out with reading an email from John Reese. Who?
Just an Internet Marketer who made over $1 million dollars in one day from selling his "Traffic Secrets" course over the Internet.
John’s emails are normally greeted with high expectation because he is renown for testing advertising outcomes. John knows what works and what doesn't on the Internet. But this time his email was nothing to do with Internet marketing. As I read his email I was filled with "sad emotions".
John Reese, this "Internet Guru" guy, who was there when the Internet started and has made millions since then, wrote passionately about the reality of being human and coping with the trauma of illness and the death of people close to him; ex girl friend, brother and his grand mother.
Despite his passion for the Internet, John's experience of human fragility almost overwhelmed him. He considered selling all his web sites and everything he has built on the Internet.
After receiving an email from a woman who bought his traffic secrets course thanking John for making a real difference to her life, John decided not to quit, on the grounds that if he can make a difference to one person's life then maybe he can help many more.
Next, I received an email from an Internet Marketer who said how sorry he was that he did not find the time to say good-bye to an aunt that had died.
Next, I heard the news of Ken Gidden's death.
Here’s the link to a seminar that might have been Ken’s first:
By now I started to reflect on my own life and how fragile it was. It was then that I reinforced the promise that I have made to myself. Continue reading and I'll tell you what that is.
Next, I read an article about the fears that young people have about starting their own business and that because of stress many felt it was better to work 9-5 for the establishment instead.
Today is Friday and what a week it has been so far. I hope next week will be less emotional and that your week will go the way you want. Perhaps I should say instead, "be good to others". Because in doing so you'll heap a pile of gold on your head that is worth more than gold.
If you've read this far you're probably asking, what promise I made. Well it's simple!
This morning I read this article, here's the link:
It's about a young man; a young entrepreneur who developed a small business idea and in doing so, has won prizes and has received free publicity. Good on him!
My promise is to put my brain to developing an income that will give me, in the short time I have left, time to spend with my family and to help people instead of slaving my time away. I don’t want to have regrets because of lack of time!
Have a happy week next week.
David
Small Business Resource
Posted by David at 10:45 AM | Comments (0)
November 2, 2005
Competition between Google and Yahoo over B2B Text Ads Warms Up
Competition for text ad budgets between Google and Yahoo could be warming up.
Following the allegation of a Google Adsense user that Google penalizes publishers that run web sites with underperforming clicks from Adsense ads, some B2B (publishers that market to businesses rather than consumers) publishers could be tempted to switch to Yahoo's text ads instead.
The publisher's allegation is that Google's method of pricing penalizes low performing sites to the detriment of higher performing ones that are owned by the same publisher. Naturally such an allegation will cause ripples, especially for B2B publishers own and pay for Google Adsense ads.
Google naturally has countered the allegation by stating that "more than conversion rate goes into determining the price of an ad and that factors such as the advertiser's bid, the quality of the ad, other competing ads, the duration of an ad campaign and other advertiser fluctuations."
I'm sure that Google has held back on all the factors that it takes into account in formulating the price publishers’ pay for Google Adsense ads.
Whether the publishers allegation is true or not, one thing it has done is to enable Yahoo to seize the initiative in saying that its system of text advertising is more transparent and that they are willing to share information with B2B publishers plus there system is more responsive.
What do you think? Do you believe Google the publisher's allegation has some truth or is he a "plant", part of a dirty trick aimed at getting B2B publishers to switch their text ads budget away from Google?
see the allegation
David
Small Business Resource
Posted by David at 6:26 PM | Comments (0)
Ken Giddens Died Three Days Ago
It's the third time this week I've read sad news, first from John Reese, then news from an internet marketer who lost his aunt but was too busy to take time to say good bye and today, news of the sad passing of Ken Giddens, who made his living from marketing on the Internet.
It does not matter if you knew Ken Giddens or not. But trust me that if you did, you would agree that he was a tender spirit who'll be remembered because of his passion for helping ordinary folks and for being true to himself.
My condolence goes out to Ken's family at their loss. I hope they'll find comfort from each other, friends and everyone who was touched by Ken's gentle soul.
I've never met ken Giddens so why am I so saddened by news of his death?
I only saw ken Giddens in home study videos shot at "System Seminar" and Carl Galetti's Conferences, so how can I explain the reason why I feel the way I do about a stranger?
The truth is Ken exuded a genuine and real passion for the Internet, especially search engine marketing. Passion that penetrated even the thickest defenses of people who rubbish the Internet as a medium that can help ordinary people to make a living online. Clearly they haven't heard about eBay.
Unlike many Internet Marketers who would never hesitate to sell you fluff at any price, Ken appeared to be uncomfortable with selling you anything that was not going to add real and tangible benefits to your business. He was almost apologetic at asking for a sale. Something that every good marketer and copywriter know is vital.
Ken's approach to the search engines, which was an area he specialized in, was to do everything that was natural to the way search engines work, especially Google. Ken likened this naturalness to nature. If you base your search engine marketing strategy, especially, search engine optimization on the way nature is organized, you should do well with receiving high rankings and never be struck off because of spamming.
I didn't know Ken Giddens but I was touched by his gentle spirit and uniqueness. Ken Giggens wont be too far from my mind when the words, decent, unique, helping folks, and being natural to the search engines are mentioned.
Rest in peace Mr. Giddens.
Posted by David at 3:17 PM | Comments (0)
November 1, 2005
Starting A Small Business
Starting your own small business: While many people fail in business, many more succeed. If you subtract the foolish failures - restaurants being the most foolish, followed by any sort of glamour business (think travel, bed & breakfast, sports, celebrity) or retail business - the number of successes far outweigh the failures.
You can reduce the risk of starting your own small business by sticking closely to what you already know. By "what you know," I'm talking about (a) the product or service you will sell and (b) the primary method by which you are going to sell it.
So, assuming you're in an industry or business you like, get to know everything about it that you possibly can. Think of your employment as a free scholarship in the school of successful business. By spending focused time working to be a great employee, you'll learn lessons that you can use for the rest of your career. You'll learn how to make a business run more smoothly, how to help it generate greater profits, and how some aspects of it can relate to other businesses.
By learning "on the job," you'll develop many ideas for starting your own side business. Some of these ideas will be small, specific ideas that you will know exactly how to implement. Other ideas will be bigger, broader, and perhaps more exciting.
When it comes time to try out these ideas on your new business, take baby steps, one at a time.
This means that you should be willing to try something new - but just a little new. If you've learned how to sell cat food with banner ads on the Internet, for example, you might consider starting a business that sells cat food with small ads in magazines. (That's one baby step.) But you shouldn't let yourself get into a business that sells health-care products for cats through direct mail - even if you could convince yourself that you're an expert in selling cat products. That business would be too many steps away from your core competence.
How to Make Your Start-Up Business Profitable in Year One
You can invest a small amount of money (and a lot of hard work and well-spent time) in a small business and see it grow into a business that is worth a million in seven years. And you'll greatly increase your chances for success by having a plan - by knowing exactly what you need to do.
A typical start-up business that's close to what you already know should break even or lose a little money in year one, make a decent "salary" for you in year two, and provide a substantial bonus for you - in additional to a good, arm's-length management salary - in year three.
To make your business profitable in year one, figure out what you need, in terms of new customer revenue, to bring a profit to the bottom line. Then devote at least 80% of your resources - your time and money - to achieving that new customer revenue goal.
The key is to follow a program that breaks long-term goals down into shorter-term objectives and finally specific tasks. Each individual task should be something that can be accomplished fairly quickly. In terms of your marketing objectives, for example, individual tasks might look something like this: (1) Stop by three offices and leave brochures. (2) Call up such-and-such group and see if they would like to have you give a talk. (3) Buy a quarter-page ad in the local newspaper.
Put all of these small achievements together and you can achieve remarkable success in a very short period of time.
8 Important Things to Know About Business
Apart from starting (and sticking to) a good plan, I've discovered eight secrets to making a start-up business work.
1. Business doesn't happen until you make the first sale .
Buying office furniture and printing cards doesn't make the business go. Selling product does. Yes, there are some initial preparations you need to make - but until you have that first check in hand, all you're really doing is spending money.
2. The single most effective way of entering a new market is to offer a popular product at a significantly reduced price.
In every industry, there is a good market for specialty and high-quality product producers - but capturing a reasonable share of those niche market segments takes money, time, and experience. When starting a new business, you are usually short in these three essentials. That's why it's better to resist the allure of high-priced, prestige products in favor of selling the most desired products and services at ludicrously cheap prices. If you can figure out how to undersell the giants, you will be in a very happy starting place.
3. It's ultimately about selling.
Conventional business wisdom says you make money when you buy, not when you sell. I disagree. Great businesspeople make their fortunes by increasing the perceived value of their products, thus inflating prices and measurably increasing profit margins. (Think Chanel, Rolex, Range Rover.)
4. When choosing a business, select one that can be grown without your personal involvement.
Many businesses - especially those built around the personality or drive of a single person - depend for their growth on the commitment of the founder. Avoid this type of business. It severely limits your growth potential. Make sure your business can expand with the addition of more money, property, or people - but not more of you.
5. Have an exit plan.
Before you invest your time or money in any business (or anything else, for that matter), know exactly how much you are willing to lose - and get out if you hit that stop-loss point.
6. Focused effort is more effective than a diversified approach to business building.
Ambitious people tend to fall into two groups: those who focus on one project at a time and those who spread themselves out on many projects. The focused approach allows you to acquire mastery faster. The diversified approach gives you more balance. I've done both. And although I'm naturally inclined toward diversification, I've had the most success and made the most money from the focused work.
7. Let your winners run and cut your losses short.
Most business ideas or ventures that begin poorly, fail. This is a very important to learn. It's easy to get emotionally attached to projects/investments we believe in. But, when the marketplace tells you that your great idea is a loser, you shouldn't keep pushing. Close the project and minimize your losses. If you really have a good idea, it will come back to you in the future in another, perhaps better, set of clothing.
8. Pareto's Principle (the 80-20 Rule): 80% of your success comes from 20% of your resources.
Most of the success/income/satisfaction you will get in your career will come from a small portion of your skills/projects/efforts. Make it a habit to ask yourself, "Where am I getting most of the benefit here?" and compare that to where you are putting in the most work.
David
Small Business Resource
Posted by David at 6:36 AM | Comments (0)
