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Published: Thu, 19 Aug 2010 12:58:35 GMT
Copyright: Copyright 2010, American Express.

Small Business Survival Stories from the Gulf of Mexico

But in every disaster there’s a silver lining, even if it’s just learning how to survive. All Americans can learn from these seven disaster survival stories:

1. Grand Isle realtor Carolyn Angelette saw a “horrific, just horrible” drop-off in sales after the oil spill. After a few weeks, however, she found a new market in renting scores of rooms to the contractors hired to clean the oil. Be opportunistic.

2.Frank Besson sold less than $40 in one week at his gift & tackle shop back in May in Grand Isle. His solution? “We're going to stay open and try to do what we can. Still owe a lot of money, so we'll see if we can sell some trinkets.” Don’t give up.

3. To support local businesses, Rebecca Wilson and other Alabama tourism reps began filming daily videos from the Orange Beach shores. The videos let people know when the beaches were clean and gave a human face for when oil was a problem. Don’t hide: get out and control your publicity.

4. Local councilman Chris Roberts was forced to cancel the annual Tarpon Rodeo, Grand Isle’s biggest source of tourism and revenue. Rather than resign to catastrophe, Roberts helped organize a big music festival, with headliner LeAnn Rimes. He hopes “Island Aid” will draw 20,000 visitors -- nearly as much as the fishing festival -- and generate some money for dozens of local businesses. Work together.

5. Sand Dollar Marina bar manager Terry Detillir churned up some business -- even with the dock closed for fishing -- through a creative new product: Tar Ball Shooters (Jagermeister plus grape jello). Other bars invented specials like Oil Spill Martinis and even held Oil Spill Wrestling nights. It may seem distasteful, but don’t be afraid to laugh.

6.Alicia and Thomas Barrios weren’t doing enough sales at their Barrios Seafood Restaurant in nearby Golden Meadow, LA. The oil spill had caused a drop off in tourists, a stigma on local seafood, and higher prices for seafood. Alicia says they stayed in business thanks to reimbursement checks from BP: “To be honest, if it wasn't for the BP check, we'd already be closed." Moreover, Thomas Barrios took a job with BP’s oil spill cleanup. Accept help -- even from the last place you’d expect it.

Making the Most of Failure

“My great concern is not whether you have failed, but whether you are content with your failure.”
~ Abraham Lincoln

In Richard Branson’s recent American Express OPEN Forum article, “Entrepreneurs Have Nothing to Fear But Fear of Failure," he talks about how stories of failure are most interesting to him because they're how he learns the most powerful lessons. I agree with that notion, particularly the two phases of failure he emphasizes: the initial failure and the aftermath (how to bounce back). Here, I explore two other fresh takes on the topic of failure and resiliency.

Charlene Li is the founder of the Altimeter Group and co-author of "Groundswell" and, most recently, "Open Leadership: How Social Technology Can Transform the Way You Lead." In case you missed it, she also wrote a robust article for The Conference Board Review, Summer 2010 titled, “The Failure Imperative (TFI).” It is worth reading not once but a dozen times to truly respect and understand the importance of dealing with failure head-on to learn from it and not waste the experience.

According to Li’s TFI, “One big barrier to adopting a culture of transparency and openness has been a systemic and cultural aversion to failure.” She goes on to say, “… that a key part of being an open leader is the ability to effectively deal with failure, because even with the best structures and planning in place, things go wrong.”

As pointed out in my earlier American Express OPEN Forum contribution, “The Art of Bold Innovation,” (refer to Point No. 7), how and why we decide to take risks has little to do with a lack of brilliant ideas and far more to do with fostering a supportive work environment where, as Li basically says, it’s okay to fail.

The crux of her article states, “there are four actions that an open leader can take to ensure that the organization is resilient in the face of failure and able to learn and grow from challenges: Acknowledge that failure happens; encourage dialogue to foster trust; separate the person from the failure; and learn from your mistakes.”

Entrepreneur and business owner Barry Moltz, however, says we don't necessarily learn from our mistakes.

He believes that once you recognize this, as well as the fact that failure happens in the normal life cycle of a business, you start failing and "bouncing" until you achieve success.

The trick, according to Moltz, is to bounce. He says, “When we possess bounce, we are able to move forward from any event, situation, or outcome — good or bad — to the next place where a decision can be made based on the choices currently available to us. We develop the best process we can and then make a clear decision.”

Once you realize that it’s okay to be honest about your failures, goals are much more fun to go after and most likely easier to achieve.

Where You Sell Says a Lot About What You Sell

From John Warrillow: For every hour you spend developing your next great product, try to spend two on where and how you will sell it.

Innovative products get ripped off, manufactured cheaply and pumped out to big box retailers at pennies on the dollar. Innovations around your sales experience may be more sustainable in the long run.

For example, I bought a pair of those goofy-looking MBT shoes last week. These are the ones with the rounded soles that are supposed to promote good posture. I was turned onto them after my Mom bought a pair of knock-off MBTs at a discount shoe store on the outskirts of Toronto. She had become a true believer, so when I saw a pair of the real MBTs in the window of a French pharmacy I decided to investigate.

The pharmacy was located in a small village in the shadow of the French Alps. I was used to buying shoes at large shoe stores so the fact that I was in a small pharmacy was the first clue that this experience was going to be different.

Based on my experience here is my list of the top 3 ways to innovate that have nothing to do with what you sell and everything to do with how you sell it

1. Your selling environment says a lot about your product

MBT claims they are the “Anti-Shoe,” designed to strengthen skeleton muscles, so the company decided to distribute their shoes in France through pharmacies, which provide a therapeutic environment that oozes wellness.

Could you find a fresh new place to sell your stuff?

2. Language helps distinguish the experience

I sauntered to the counter and inquired about the MBT shoes in the window and I was ushered into an elevator and whisked to the second floor where the “nurse” would see me for a “consultation.”

How do you describe the experience a customer has getting to know your company for the first time?

3. Uniforms matter

After a minute or so, an attractive woman appeared from the elevator wearing a long white nurse’s uniform. She asked a few questions about the sports I play and made some recommendations on how the shoe should be worn (walk heel toe, balance when stopped etc).

The nurse’s costume inspired in me a sense of confidence, caring and authority, which went a long way to inoculating me from the steep price tag of €230 (roughly $300).

Is there an opportunity for your employees to wear a uniform that supports the overall experience you are trying to create?

My mom paid $50 for her knock offs; I shelled out $300 for what I am sure are fairly similar shoes. In a world where new product innovations are copied in weeks, perhaps the only lasting point of differentiation is where and how you sell.

John Warrillow is a writer, speaker and angel investor in a number of start-up companies. He writes a blog about building a valuable – i.e. sellable – company at Built to Sell.

Does Your Community Know You?

A few weeks ago, my wife discovered a wonderful little curiosity shop in a town near us called Blumster's. She and I have driven by the shop many times over the last few years, but frankly, had no idea what the business was at all. My wife believed it was a florist shop and since she had no reason to buy flowers, she never stopped in.

In fact, she only happened to wander in the door because she was waiting in the area for another service and was strolling down the sidewalk by the shop. She looked in the window, was intrigued, and discovered that Blumster's was actually a charming little eclectic shop that sold soup and sandwiches.

When she returned to the store a few weeks later to pick up a gift for a friend, the person working behind the counter told her that the shop was going out of business. My wife was chagrined and asked why it was closing. "Not enough business."

"Well, that's a shame. I just discovered this shop and I really like it. I've been driving by here for years and never knew what it was."

The person behind the counter just smiled at her. "You wouldn't believe how many times I've heard that exact same comment in the last six months."

When I heard this story from my wife, my jaw dropped. We live in the area that would be directly served by Blumster's. We drove by this wonderful little shop every day for years without knowing what it was.

We weren't alone in being unaware of this wonderful little business. I asked my neighbors if they were familiar with the shop and none of them were even aware of it other than thinking that they'd heard the name before at some point. Lots of people in the very community that Blumster's was serving were unaware of the store's existence or what they provided.

Here's the real truth of the matter. If you run a small business, it doesn't matter how good your service is, you're going to have business problems if large portions of the community you're serving have no idea what kind of service you're providing.

For some businesses, this isn't a problem. Franchises often have reputations that precede themselves. Some businesses make it clear what they're selling from the name alone. But a wonderful, eclectic little shop like Blumster's was so poorly presented that my wife actually believed it to be a florist.

There are so many simple little things that Blumster's could have done to turn their business into a thriving one. For $1,000, the shop could have produced a small flier describing what the shop is, what it sold, and provided a coupon to get people in the door, and had that flier dropped into every mailbox in the community and the surrounding community in late October or early November (to get those Christmas shoppers). For far less than that, they could have put up a few fliers around the community talking about their shop.

Instead, they made the mistake of familiarity. Their shop had been in business for a long time and they assumed the community knew about the shop.

Never, ever assume that your community knows you unless you've got a mountain of business. If your shop sits largely empty on a slow day, it might be simply a matter of awareness. Do your potential customers even know who you are? When was the last time you reminded them of the fact? Is there an easy way you can get their attention again?

Barbara Lynch on Knowing Yourself, Your Limitations and Whom to Hire

When No. 9 Park was awarded Boston Magazine's Best of Boston Award for Best Restaurant in 2003, chef and owner Barbara Lynch was already as well known as her former mentor Todd English, or maybe even Fenway Park.

And that was before she went on to open a stylishly casual oyster bar, B&G Oysters, a charcuterie and butchery outpost that serves $14 glasses of wine called The Butcher Shop, an ultra-modern speakeasy with the craftiest old-school cocktails in town, Drink, the modern Italian diner Sportello, and the contender for the Most Expensive Restaurant in Boston, Menton. Not to mention her cooking school Stir, or private catering company, 9 at Home. Her umbrella company, Barbara Lynch Gruppo, now rakes in more than $10 million a year.

So how does a self-professed "kid from the projects" transform herself into the hottest and most well-respected chef in Boston? According to Lynch, it all comes down to "taking educated risks, listening to your gut, and being good to your people."

"My upbringing instilled in me a very strong work ethic," Lynch says. "I had no choice, I had to work and I had to work hard because no one was going to hand me anything."

Growing up in the projects of South Boston, Lynch was one of seven children and raised by a single mother. Her taxi-driver father died before she was born. She first got behind the stove at the tender age of 13, cooking sausages and onions for the priests of the church across the street. "My mother worked three jobs at a time so it was normal to work that hard, and I'm now thankful for that example."

"My motto has always been 'fake it until you make it,'" she says. After dropping out of high school her senior year at Madison Park High School—the only class she excelled at was home economics—she finagled her way into a string of food-related jobs, stretching the truth or outright lying at job interviews to get her foot in the door before finally landing a job at Michela's, with a then rising-star chef named Todd English. She'd later go on to open both his flagship, Olives, and his haute-pizza mini-chain, Figs, before taking flight on her own as the chef at Galleria Italiana. In 1998, she opened No. 9 Park to almost instant acclaim before continuing to open a series of wildly successful and diverse ventures.

For Lynch, the secret to restaurant success is as much about recognizing her own limitations as it is exploiting her strengths.

"I love wine and great cocktails and have a very specific idea about service and hospitality, but I am not the person to lead in those areas and I know that," she says. Rather, she leaves front-of-the-house operations entirely in the hands of her general managers and Cat Silirie, wine director for all of Barbara Lynch Gruppo's endeavors. A friend and longtime collaborator, Silirie and her wine program exemplify the traits that Lynch says are the key to success: finding "dedicated, local, and passionate people."

While most chef-owners with multiple restaurants are kept busy enough in their roles as visionaries, managers, and administrators, Lynch—who stays fit by boxing in South Boston—is well known among Boston cooks as one of the few who can still outperform anyone on her staff behind the stove, often jumping onto the line when orders get backed up. "Some days I think it's a lot easier to just be in the kitchen and cook. There aren't as many moving pieces" as there are when running a restaurant empire. But still, she says, "The multitasking we do in the kitchen comes in handy for the business side."

"Trust is involved, as is instinct, and having a clear vision that you can articulate to people to get them on board and excited." Trusting fresh talent rarely pays off in the industry but is a gamble that that Lynch seems to have a preternatural gift for.

Take Colin Lynch (no relation to Barbara), who began his role in Barbara's empire as a young extern from the Culinary Institute of America. Under her guidance, he soon took the lead as co-executive sous-chef at No. 9 Park—a transition that can take three to four times as long at an average restaurant. He's currently the executive chef at Menton, Barbara's new ultra-swank French restaurant in Boston's burgeoning Fort Point neighborhood, helming the kitchen that serves meals commanding a hefty price tag of $95 to $145 for food alone.

Such trust in fresh blood is nothing if not courageous in an industry notorious for quick staff turnaround. "I don't know of any business owner who hasn't been burned," Lynch says. "The trick is to learn from those experiences but not let it prevent you from trusting others again. One of the best things I can do is to hire a young cook and give them the resources and guidance to grow into a fantastic chef."

"We've set up our company to offer our young employees as many opportunities to grow and develop professionally as they are willing to take," she says. You get the distinct impression that her willingness to trust in passionate but nonetheless relatively experienced cooks is a direct result of the resources that were noticeably absent in her own past.

Despite the array of experiences and price points on offer at her various establishments, Lynch maintains that they all have "the same common denominators: warm hospitality, excellent food, an inspired wine and cocktail program, and," perhaps most important, "a culture of education with staff excited to share knowledge with guests."

4 Things to Consider When Creating a Business Logo

With all the noise on the Web today, good branding is more important than ever. Even if your business is not a cutting edge tech startup, the overall identity of your face on the Web, social media and your storefront should be unified, clean and compelling.

There's a lot about doing business on the Web that is inexpensive and turn-key: All you need to fire up a basic website, blog, or social media presence is an e-mail address. But no Web app can substitute for real design vision, and your logo is the linchpin that ties all of your business's aesthetics together.

Whether you're going to hire a pro or put those college art electives to good use, take a moment to heed some advice from the experts about what makes a biz logo "sticky" in the minds of web-savvy consumers.

A logo is a first impression. Before a customer knows anything about what you do or sell, they'll view your identity with two choices: Keep reading, or click away. On the web, that choice is made in milliseconds.

Like the clothes you'd wear to a business meeting, your logo has to say, "I'm smart, I'm savvy, and I can compete," at first glance.

"[The] first thing any small business owner should do is realize their business exists in a marketplace driven by multi-national brands," said Von Glitschka, an illustrative designer who works extensively on identity and branding. "Their identity needs to be able to compete visually on the same level to be a success."

The reason the Web has been such a boon for small businesses is that they have reach comparable to big corporations like never before. So come to the table prepared, design-wise.

"A small business can maneuver and adapt to an ever-changing culture far easier than a multi-national brand can," Glitschka added. "But if they don't lay a good foundation for their marketing via a well-designed and appropriate logo and identity, they are handicapping themselves right out of the gate."

"Research," said Sneh Roy, a graphic, web and logo designer based in Sydney, Australia. "There is nothing worse than bringing to life your vision... if it has all been done before. A small business owner is fighting for a small [piece of] real estate in a highly overcrowded market. Doing thorough research on who his competition is and how they project their brand image is the first and most important thing for a small business owner."

If you've done your homework, it's time to think about what kind of visual identities make a strong impression.

"The average consumer is fickle even in his loyalties, purely because of the sheer number of choices available to him," said Roy. "Because a logo must be non-changing and timeless, making it 'sticky' can be a bit 'tricky.' The perfect amalgamation of minimalism, well-thought-of concept, and strength in bold colors and typography -- in my opinion -- is what eventually makes a logo memorable and sticky for the consumer."

"Avoid the predictable trends, forget about what others are doing, and create something that uniquely represents your business," said Glitschka, and remember that "your actual business will be the ultimate draw, not the logo."

"A logo that doesn't preach; a logo that leads and adapts to the changing times; a logo that has heart and the ability to connect with the viewer can and always will cut through all the 'noise.'" Roy added.

For those starting from scratch, the web makes it easy to browse the portfolios of artists whom you can connect and work with from anywhere in the world. There are a few approaches that may yield results:

"Look for a designer who has a good grasp on marketing. Understands brand culture, has a proven methodology with other small business clients and a portfolio to back it up," said Glitschka.

"One of the most important factors to consider when shopping for a pro logo/graphic designer is the style," said Roy. "Each logo is different and the brand it represents may have very specific requirements. Look around to find a designer whose design style fits your needs."

You've found a talented designer, and she's produced the perfect logo for your business. What's the best way to (re)introduce it into the social marketplace? A logo alone doesn't make a brand, and the process of building a presence around that identity is no small feat.

"Any logo design should take into consideration from the very start the potential context it will live in," said Glitschka. "If the business is geared for an online existence, then the design should be appropriate for that format. A tall vertical logo for a web-based business would be inappropriate for the context."

"Translating a logo design into a larger web/social media presence should be purely decided on need," Roy added. "If your business doesn't need it, don't cheapen it by jumping on all kinds of media online and off the web. Have a good focus of where you want your brand to go and set your logo only along that focused path."

In the end, Glitschka notes, it's still your core business model that will determine "whether the logo will play a part in transforming a business into a larger web presence."

Add the Right Amenities and Services

If I were a hotel, I'd put two reusable travel water bottles in the room for free. I think it's a better decision than charging me $7.00 for water (as one place wanted to do), and more cost effective and environmentally friendly than free. But this is just a start.

To me, one of the most important mistakes that businesses make is in figuring out the right amenities to roll into their offering, and/or missing opportunities to add service offerings to the mix.

When I was on vacation recently, I wanted to buy everyone staying with me a lobster dinner. I drove to the lobster pound (which was closed, so I drove back when it was more convenient for them), and I bought enough lobsters and clams to feed five families. I then carted it all home, had to find the stuff in my rental kitchen to cook everything, and had to deal with all the mess of creating a lobster dinner.

I'd have paid 40 percent or more on top of what i paid, if I'd been offered a "lobster dinner" option, where the store sent two people with all the food, did all the work, and carted off all the shells and stuff. Think about how much that would cost the store: labor only, basically. Everything else would show up on the bill, and even the labor would be offset by the tipping factor.

Ultimately, there's what you sell, and then there's what you could add to the story if you looked for it. I'm enthralled by seeking out the latter. How could I add something free in some cases, and how could I add something that costs more but adds to the experience in others. If you're a coffee place, how much would it really cost to offer a little free cookie with each cup of coffee. Even though I wasn't eating cookies at the time, I was pleasantly surprised.

Some number of you started thinking about all the drawbacks, expenses, and potential for waste. But maybe you are different. Maybe you see what I'm saying. Maybe you think there's something to providing a little "something extra" to a buyer's experience. If so, how could you adapt my thinking above to your business? What else would really add to the experience, and how would that help your sales?

How to Quit Well (and Avoid a 'Steven Slater' Moment)

It's become the "I Quit!" moment heard 'round the world: Former Jet Blue flight attendant Steven Slater's dramatic and very public exit from his job -- down an airplane's escape chute -- has elevated him to media hero status.

As the narrative goes, after two years working for the company and 28 years in the airline business, he apparently had enough and quit while on the job.

Although the investigation into Slater's action is ongoing and new details are still emerging about who started what before he announced he was quitting his job with Jet Blue, a few things are clear. Slater got on the intercom at the end of the flight, cursed at some passengers, then headed for the emergency chute -- after grabbing a couple of beers. In the aftermath, Slater has become a hero to workers who feel under-appreciated and put-upon -- and have fantasized about their "I quit" moments.

It's also helped create dialogs with managers and business owners about policies and management. So if you're thinking of living out your own "Steven Slater" moment, experts urge caution: Slater already has spent $2,500 to bail himself out of jail and may face more fines and real jail time.

Of course, making a classic moment out of quitting isn't new. Hollywood's been selling movie tickets with those themes for years; audiences can relate.

In Hollywood, Jennifer Aniston's Office Space character, Joanna, triumphantly quit her job as a waitress by cursing her boss out. Anne Hathaway in The Devil Wears Prada did what countless people with insanely demanding bosses fantasize about and tossed her work Blackberry in a nearby fountain.

In that spirit, I set out to find other larger-than-life ways people would like to give their notice.

Unlike Slater, whose "I Quit!" story spread like wildfire, everyone who shared their fantasy flee was not willing to be identified after sharing what they might do on their way out of their self-imposed last day of work.

A teacher, a hotel concierge, and a boutique manager all said they'd likely pull the fire alarm on their way out the door. State law prohibits pulling fire alarms and doing so is considered a misdemeanor class A crime. And even worse, is if someone leaving the building gets hurt, you score felony charges and face up to $10,000 in fines and one to three years of jail time.

A quick YouTube video search brings up a plethora of videos of people in customer service and retail jobs making a spectacle out of their quitting. Already Craigslist is running a blind item casting for a TV show about quitting Slater style.

And then there was last week's photo-essay quit that turned out to be a hoax orchestrated by The Chive, as well as a video from the website Funny or Die, who gave the ultimate kiss off Harry-Potter-book reveal-style.

The most creative story I was told came from a film director who fortunately channeled his hair-brained idea into more two dimensional entertainment. While working as a lifeguard during his teen years, he'd planned to create a large water explosion as his sayonara.

Quitting can be both a stressful and cathartic experience. It's clearly best to do it in more of a proper way and give notice. Before you consider doing something drastic and dramatic, run through this list of how to go about it:

Have a good reason to quit. Not liking your boss, colleagues, or getting annoyed by customers isn't really enough of a reason. That's life, after all.

Follow the protocol. Think about it. Make an appointment with upper management. Tell your superior face-to-face and calmly that you're leaving. Follow up with a letter making it official. Never scream or curse!

Give two weeks notice. Don't just storm in and scream: "I quit!"on the way out. After all, they might like that you be available to train the next person who takes over your job. And you likely wouldn't mind getting a recommendation down the road.

Don't do anything illegal. That means you shouldn't use leaving as your opportunity to steal anything, from sensitive information to a few beers.

Once you're gone, don't badmouth your former employer. It's a small world. It can always come back to haunt you.

4 Reports That Will Keep Your Business Thriving

As companies grow, they inherently become more complex. They eventually outgrow the capacity of their founders to be involved in every single detail of the business. There are too many customers, employees, products, projects, vendors, and suppliers with which one person can be intimately involved.

As the leaders of thriving companies become removed from the details, they feel a loss of control and will likely struggle to know how the company's cash flow and profitability are really performing. They have to rely on reports with lots of numbers and data to understand how the company has done and make the best decisions possible to help the company succeed in the future.

The transition from a startup to a booming company is often difficult for founders and entrepreneurs. They have to re-train their intuition to process reports and data rather than talking to their employees and customers and reviewing the bills from their vendors and suppliers. While they should still engage in getting information from these qualitative sources, quantitative data will become more and more important to them as the company grows. Generally, quantitative data measurements need to cover both the past and future on a daily, weekly, monthly, quarterly, and annual basis.

Find one to three measurable pieces of information that can be reported daily. The items included on the daily report need adequately to allow the management team to answer this simple question: "Did we win or lose today?" Some examples include gross profit per day, daily units sold, billable hours worked, backlog, and more. In addition to reporting actual performance on a couple of critical ratios, thriving companies need to know what tomorrow will look like. Measuring performance is not the reason to be in business, but it is critical to running the business effectively.

Have a weekly report that highlights between 12 to 20 data points, with at least one or two coming from each of the critical areas of the business: marketing, sales, operations, finance, R&D, etc. These might include number of leads, leads converted to sales, cost per acquisition, revenue, revenue per employee, number of employees, percentage of receivables past due, working capital, current ratio, and more. (You can receive some more ideas on what should be included from one of my recent blog posts, The Key Business Metrics Every Entrepreneur Must Know.)

Besides knowing how the business did last week, this report should also project the company's performance on these key numbers for the week to come. Also look at an updated cash flow projection (at least 90 days and up to 270 days into the future) each week so your company can adequately plan for and adjust to cash flow shortages and excesses.

It is also important to have monthly and quarterly financial and operational reports, which include monthly financial statements. The monthly financial statements should include comparisons to prior years and months in the business as well as to industry averages and benchmarks. Performance relative to the company's plans and budgets, as well as projections for the next month and year, should also be included and analyzed. Pay particular attention to validating and invalidating assumptions, and then improving them from month to month. Similar reports need to be reviewed on a quarterly basis, but they are typically more summarized and need to include lots of charts and graphs for quick review and presentations, often to the company's board.

Companies should revisit their five-year financial model and plan on a yearly basis. This includes a careful assessment of all of the assumptions that went into the model and updating those assumptions based on the actual performance of the company. Many business owners fight this activity because they feel it is too hard to project five years into the future. While it is certainly hard (and I have yet to see anyone that has projected their business performance perfectly for five future years) the exercise always yields helpful information to build a more competitive and sustainable business.

If you want to give your business the best chance to succeed, you may want to consider establishing processes for all of these critical past and future reports. They will help you make sure your company is improving its cash flow, profits, and financial health!

5 Site Metrics Every Small Business Should Track

Many site small business owners' eyes glaze over when people start talking about analytics, click through rates, and abandonment funnels. Really, there's a lot of jargon that goes with measuring a site with analytics.

Small business owners should be paying attention to their site analytics because the data provides useful insights into their site traffic, which ultimately leads to more sales. If you're not paying attention to your site analytics, your business is leaving money on the table.

The problem with most analytic packages is that they're large and confusing, providing tons of data without much instruction. Fortunately, there are only a few really important metrics that small businesses owners should track to get the best results. It's like the 80/20 principle: these are the 20 percent of metrics that provide 80 percent of the most value to small business owners.

First off, you'll need to install tracking software. It's usually only a matter of installing a bit of javascript in the footer of your site's design. If you don't know how to do it, your designer should be able to very quickly.

There are tons of stat programs out there, but Google Analytics gives me almost everything that I need to track. It's robust and free, so it's the perfect analytics program for small businesses.

After you've set up Google Analytics on your site, you'll also need to set up a few goals. Goals are the foundation for most of the metrics you'll track. You can define goals for when a visitor completes a sale, or signs up for your newsletter, or anything else. (Here are some great examples of goals you can create.)

So for now, start tracking your single most important goal, like completed sales or newsletter subscriptions. Once you get the hang of how Analytics works, you can add other important goals. (Here's how to set up a goal in Analytics.)

Now that you've got your goal set up, you'll start gathering data on your site. Here are the most important metrics that you'll want to track for your small business website:

Conversions are the biggest thing that you'll want to track. Conversions are the number of sales divided by the number of visitors that come to your site. Many site owners are clueless as to their site conversion rates, and if you don't know this basic bit of information, you won't have a baseline to improve your site with.

Goal conversions allow you to effectively see lots of great things such as what page on your site makes the most sales, the referring site that led to the sale (ie. Google, Twitter, etc.) and where people leave the "sales funnel" and stop the purchasing process (more on that later).

These are important insights for your site. If you can improve your conversion rate, you can make more sales, which is the reason you have a website for you business in the first place, right?

A referrer is simply who's sending traffic to your site. Is it Twitter? Is it advertising? Is it some other website? Knowing your traffic referrers also allows you to see if you're getting an outside spike of traffic from an unexpected source.

Knowing the main source of your site's traffic allows you to focus your energies on different content strategies to attract the right type of traffic.

Another great feature of tracking your referrers is the ability to gauge of the effectiveness of advertising. If you're spending money on advertising on another site, you can see if it's actually sending any traffic or converting sales (with your above goals).

Bounce rates show the percentage of people who leave your site by only visiting a single web page. High bounce rates mean something is wrong with your site, and steps should be taken to fix it. It could be that visitors aren't getting engaged, or your design might be too cluttered and confusing. Bounce rates are a great indicator of the effectiveness of your site.

The Reverse Goal Path is a way to see the path that your visitor took to complete a goal. This gives information on the pages that generate the most sales.

Similarly, the Goal Abandonment Funnel shows where the user left the "funnel" in a started goal. This metric allows you to see which pages gave the user reason to not finish the goal, like make a sale.

Both these metrics are very useful for getting an idea of what motivates and repels your visitors when they're at your site.

Search keywords are the keywords that search engines refer to your site. Search engine visitors are some of the most motivated traffic, as they're looking for very specific things. This means they're typically more likely to buy things than the average visitor. Knowing what keywords send your site traffic allow you to: a) figure out what you rank for those keywords and b) determine SEO and other marketing steps to improve those rankings.

Google Website Optimizer - Perform A/B or multi-variate testing to optimize areas of your website for visitors

Crazy Egg - Give heatmap data, showing where visitors click on your site and other interesting data.

3 Easy Ways to Master Your Facebook Presence

When you dive into Facebook stats, the numbers are staggering: there are more than 500 million active members, 500,000 interactive applications, and people are spending over 700 billion minutes per month on the site. For business owners, it's clear you need some type of presence on the world's number one social networking site. However, once you sign up, what's the next step?

First, you should create aFacebook "like" page (formerly called "fan" pages), which is fairly simple. Simply create your page, edit your information, and push it live. The real challenge with your page is to get people joining, and coming back for more. I've had an AmberMac like page for many months, but it wasn't until this year that I truly understood how to make the most of my presence there.

Early this spring I sat down with a friend on Facebook's strategy team. I asked him to spend an hour with me to demystify the page experience and give me some insider tips for Facebook success. I learned a lot during the 60 minutes, and the way I approach my own Facebook Page changed. Essentially, I learned what other businesses need to start doing now.

Many companies spend time prettying up their pages, diving into the Info, Photo and Notes tabs, but the truth is that very few people actually venture out to spend time on your page and within these tabs. In fact, approximately 90 percent of people communicating with your Facebook page are doing so from their own personal news feeds. In other words, only 10 percent of people are leaving the comfort of their Facebook home pages to check out your presence.

Since most users are interacting with you via updates, focus your Facebook strategy on writing compelling messages on your Wall. Facebook pushes these status notes to your users' feeds (unlike other tab updates, which simply sit in one place). Ideally, you want to write something that encourages your friends to comment, like, or share your messages. This is how your Facebook page will become more popular.

While writing compelling messages is key to getting your feed into the hearts and minds of your online community, a picture is worth a thousand clicks. You don't need to post a professional picture every time, but regularly attaching cellphone photos to your messages and trying to make your posts more visual is a must. Aside from photos, videos are also heating up on Facebook. The site is now one of the top five video viewing destinations online, so make it a habit of attaching YouTube videos to your messages to get more traction.

Facebook page owners can get free analytics with Insights, a tool that sits within your account. This information is an important part of your Facebook success since it will help you to understand who is using your page which includes demographic info such as gender and age (allowing you to post appropriate messages).

Within this area you can also get details on how much people are interacting with your content in order to learn what type of content is getting the most clicks. One note: many users have found that they first need to authenticate their Facebook page before accessing Insights.

In addition to these three recommendations, ensure that you update your Facebook page with at least one new piece of content every weekday. While you want to make sure that you keep pushing out interesting updates, don’t forget the Cardinal Rules of online success: Share information from your community and not just information about what you are doing. In other words, visit the online profiles of your Facebook friends and make sure to “like,” comment on, and spread interesting posts from them. Social media is, after all, a two-way street.

Investing in Your Community Will Boost Your Sales

No business operates in a vacuum. No matter where you are based, your company is part of the local community — and it can easily be part of other communities, both online and off. It's tempting not to worry too much about the community, of course. The most important focus should be your business's success, rather than trying to integrate with your neighbors. But the two aren't mutually exclusive.

Your community and your customers are not mutually exclusive. In fact, there's likely to be significant overlap if you rely on local sales. If your business operates primarily online, you still have a community to consider, but you may not have the convenience of using geography to identify your community.

Depending on your preferences, you can make your community involvement a part of your marketing plan, list it under public relations, or categorize it under something entirely different. But there are a few facts that make it an important process.

First, establish a reputation as a trustworthy member of the community. Your reputation is important for reasons beyond your income, but it doesn't hurt to remember that people prefer to buy from companies and individuals they can trust. They're more likely to trust someone they know, someone from their own community.

Second, community involvement can be crucial in a crisis. While it can be difficult not to be cynical when considering problems such as those BP currently faces, it's easy to see that the company is making use of every community connection it can to mitigate the problems it faces. In particular, the positioning of Darryl Willis as the face of the compensation process seeks to build a sense of connection. As Willis says in a recent radio ad, "I was born and raised in Louisiana. I volunteered for this assignment because this is my home. I'll be here in the Gulf as long as it takes to make this right."

No matter the strategy behind community involvement, being aware of your company's position in the community is a necessity.

Since you must operate in your community, it simply makes sense to make your community a key resource for your business. That can require some investment and where you choose to invest your time and money can vary significantly. Some investments will bring you directly into the view of your customers. Some will help you build up the infrastructure you need in your community to cut your costs or to put your community in the position of needing more of your products or services.

Sales are typically the crucial question for small business owners. As such, you've likely put together information on where your ideal customers are most likely to be found. That same information can lead you to opportunities in your community. In some cases, you may find that you're looking at more of a donation than an investment — but if there is a return on your donation, such as more awareness of your company in your target market, you can have a much better financial benefit than a simple tax deduction.

Even relatively simple investments at the local level can help your business to cultivate situations in which your services or products are needed. A CPA, for instance, can easily hold free workshops, investing his time to help the individuals he would like to work with. By educating prospective clients about their own needs, that CPA has also shown them where his services would come in handy.

Investments aren't just for companies who find their customers locally. If you operate a company where most sales occur outside of your immediate area, your ties to the area are still very strong. You likely recruit most of your employees, locally, after all, and the right investments can help build a pipeline that funnels trained and able employees right to your company. Take a look at the local school system: even a little investment may be able to help you to find the employees that you need now and down the line.

Hopefully, you'll choose your community involvement based on more than your financial benefit — perhaps your own interest in seeing your community or a particular cause within your community succeed — but it's hard to argue that most business owners aren't aware that there benefits to community involvement in terms of public relations. Such benefits do require action on your part to take advantage of, however.

Simply increasing awareness of a company or a product can help increase sales. But if your customers or clients equate your company with the efforts you've made in your community, they are more likely to seek your business out at levels beyond what generally increased awareness can create. But making sure that the word gets out there often requires a little self-promotion. No one else will go out of their way to tell people about the good things you've done. That can require a public relations strategy that shares the good news.

There is a fine line between sharing that news and pushing too hard to make sure that the local public sees your efforts and investments in the community, of course. But sitting back and hoping that someone else will mention your good deeds is too much to hope for. Planning a strategy that avoids going overboard is necessary. There are approaches, however, that can work in certain situations. For instance, if you've focused on a philanthropic cause in your local community, it's possible to promote the cause and only incidentally promote your involvement with it.

You don't need to be cold and calculating when it comes to investing in your community, but it is worth paying attention to the opportunities, both direct and those that you have to promote, that your community can bring your way.

If I Could Do it All Over Again...

One of my favorite sayings is, "Ninety percent of life is just showing up," because finding the courage to pursue your vision and start a new business often hinges on just that first step.

Once you've spotted an opportunity in a given sector, having the confidence to follow your dream and raise that first crucial bit of financing is often the hardest problem facing a budding entrepreneur.

The following two questions reminded me of how I established some of my first businesses, and how I'd begin again if I had the chance.

Q: If you were 24 today, and you were given a budget of $3,000 to start a business, what kind of business would you choose? What if the budget were around $25,000?

A: That's an easy one. It would definitely be some kind of Web-based business, and I'm not sure it would make a difference if I had $3,000 or $25,000 to start out.

I began my career in the late '60s with my first business venture, Student magazine. I started by selling it one issue at a time, and soon moved to selling records from a phone booth. The publishing and music industries are struggling today due to the changes brought about by the Internet -- but where there's upheaval, there's opportunity.

Look at how Apple has revolutionized the music industry with iTunes and the iPod, its digital music player. Such is the genius of Apple's designs and their hold on the consumer that the company has taken the mobile phone market by storm with its "you gotta get one of these" iPhones. Then it tackled the publishing world with the iPad.

A whole industry is growing up around designing applications for Apple devices: games, magazines, booking engines, and so on. Successful application designers and publishers are already making a fortune, the way publishing and music moguls did in the '60s and '70s.

I have always been fascinated by all forms of content -- music, books, television and film. Virgin has invested in all of these industries, with mixed success. If I were reborn as a 24-year-old, I would look at this area for an "app-gap", a gap in the market or an opportunity to shake up the leading players.

And today I would also think big: These days an entrepreneur faces few geographical boundaries to success. When I started Virgin, our projects were limited to the U.K. because of financial limitations and cultural differences. With the development of the Internet, the world shrunk rapidly, and is now a far more cosmopolitan and connected place.

A: The first, and probably most obvious, is to borrow from your family and friends. It is high-risk, for if things go wrong, you can lose not only a business but also a friend or the friendship of a family member. However, for many entrepreneurs this is the fastest and only way to raise start-up funding.

Over the years I have been lucky in that my family has been able to bail me out or provide some early money on a few occasions. In 1967, I was living in my friend Jonny Gems' parents' basement off Edgware Road in London. We were broke and struggling to get Student magazine off the ground.

But one day my mum, Eve, brought us 100 pounds in cash. She had found a necklace on the roadside and taken it to the police. When nobody had claimed it after three months, the police told her she could have it. She knew we were out of funds, so she sold the necklace and gave us the money. That 100 pounds paid our bills and kept us going for months. The business would have collapsed without it.

The second option is to apply for a bank loan. From the beginning I tried to build my businesses by relying on my own resources and some bank debt. This allowed me to control the lion's share of the equity until I felt we had the stable platform we needed before we could bring in outside investors. In Virgin's early expansion days we would sometimes lurch close to collapse because I was so reluctant to bring in outside equity. I felt our limited capital kept us focused on finding the next great act, and ultimately this was a real contributing factor to our success.

Lastly, if the bank won't lend you the money on the strength of your idea alone, you have to have the faith and conviction to borrow against your existing assets, such as your house -- or, if you are lucky as I was, a friend's or relative's assets.

In the early '70s, I was looking to purchase the Manor, the country house that would become our first recording studio, for 30,000 pounds. I had put up the only 2,500 pounds I had in the world and managed to persuade the bank to lend me 20,000 pounds, but I was still 7,500 pounds short. That is, until my Aunt Joyce stepped in and said she would lend me the difference.

It was an amazingly generous and risky gesture, and one that I may not have accepted, had I known that she had mortgaged her own house to provide the capital. I did accept it and bought the Manor, which soon became home to our first hit, "Tubular Bells." Virgin grew quickly from those shaky beginnings to become a successful business, and I made sure I paid back Aunt Joyce her 7,500 pounds - with interest - as soon as I could!

Another risk of taking the friends and family route is of course what they may ask for in return. In my case, had she really wanted to push it, people could today be flying on "Aunty Joyce Airways."

Financial Risks and More in Global Sourcing

Global sourcing holds the promise of higher profits through cost savings on nearly any product imaginable. But risks lie in nearly every stage of the sourcing process.

One of the links in your sourcing chain (trading agent, stateside representative or vendor) might accept your payment but doesn't deliver goods according to the purchase agreement.

Find a banking partner that facilitates international transactions, specifically import activities. Collaborate on methods of structuring agreements to protect your company's interests and assure timely, appropriate payment to vendors. Check business and bank references of intermediaries before starting the sourcing process; develop agreements that transfer title upon receipt of goods.

Your business orders a container load of products to save on per-unit production and shipping expenses. The sell-through is slow and the inventory ends up lasting more than a few years. As a result, you pay warehousing fees or take up valuable space in your warehouse to store inventory. And, cash that could have been invested in faster-moving items is tied up. Eventually, the product becomes obsolete and you sell excess inventory at cost or less.

To avoid inventory overload, place buys to maximize profits rather than minimize per-unit costs. Compare potential per-unit cost savings with inventory-carrying costs. Find vendors that accept relatively small orders with capabilities for short production runs.

Getting a patent or trademark in the United States or your home country doesn't protect your intellectual property worldwide. Vendors often share ideas among their customers during factory visits and inspections. Your business will have no rights to recourse if your proprietary concept is accessed by competitors to create a new product design or promote an image that represents your brand in other countries.

To protect your ideas in the United States and outside its borders, engage legal counsel with intellectual-property expertise in all of the countries where your products will be made, marketed and sold.

The shipment that your business receives doesn't match your specifications or quality standards. There are a multitude of reasons that finished products miss the mark: defective components, incorrect dimensions, shade variations or lack of proper functional performance. Problems may originate from imprecise communications, cultural misunderstandings, slack controls, or inability of vendors to make products as specified.

Take a series of precautionary and follow-up steps to assure compliance with product requirements. Before placing an order, evaluate the vendor's overall quality and its systems for adhering to product standards. During the product-development phase, be thorough and, if possible, use visual images and prototypes to convey specifications. Set up protocols that require testing and approval of components, colors, and samples prior to full production. Inspect shipments when received at your company's facility to verify compliance with all requirements for product design as well as labeling and packaging.

Verify that your vendor has the capacity and willingness to fill your order on time. Judge vendor claims relating to production volume and availability based on factors such as number of machines and employees on the production floor. Consider the priority of your business in the vendor's portfolio of customers.

Make sure that your company adheres to vendor timelines and lead times relating to materials availability, sample approvals, and order placement.

Your shipment arrives on time but is compromised in some way: there are insects in the shipping container, some items are missing, or the product is damaged. Pinpointing the source of the problem is tricky but critical to getting remuneration from the vendor, steamship line, trucking line, etc.

Specify FOB Destination Freight Prepaid so that your business doesn't take title (and payment doesn't transfer) until the shipment arrives safely at your facility. In this way, vendor, agent, or intermediary controls freight and is accountable for product and shipment integrity.

Other options include: purchasing and sealing container loads of product so that shipments are inspected prior to overseas transfer; or hiring agents to inspect shipments at each stage of transportation. As a result, you can determine the timing and cause of any damage or pilferage.

Your shipment is held at port awaiting customs clearance. In addition to shipment delays, your business incurs charges relating to container demurrage fees.

Engage a customs house broker to clear your shipments on time. Anticipate and address all shipment and product-specific issues according to guidelines, which includes providing ocean bills of lading and commercial invoices; assuring accurate country-of-origin labeling; and verifying results of product safety testing.

Your business would like to develop a new style or replenish its stock on a hot-selling fashion but lead times prevent quick action. Products that your business has ordered have fallen out of fashion before they've been received.

The reality of long lead times is hard to dodge so weigh potential for rewards with sourcing risks. Follow market trends worldwide and commit to being early with fashion-forward items. Order raw materials and book capacity with factories early to get faster-than-normal replenishment. Speed up timelines by air-freighting samples or even finished goods, depending on the product size and weight.

To mitigate risks overall, negotiate every detail of agreements with vendors — not only pricing but also full program compliance with delivery deadlines, product specifications, packaging, and more. Establish and enforce penalties for vendor failures so that your company reduces its financial risk associated with global sourcing. Encourage your vendor to communicate any problems as soon as possible so that your business can make adjustments quickly.

Force Your Staff to Rest

One of my favorite lines at the office used to be, “great day–take the rest of it off.” I used to tease people with that and say it at 6 o'clock. I’d also say it to people in the morning occasionally and blow them away.

We all know that as entrepreneurs we duck out of the office for our little stress breaks. Let your team take some once in a while, too. They’ll thank you for it verbally and with their effort later as well. Let them really recharge their batteries.

And if you really like your employees as much as you say you do, let them take the same amount of vacations as you’d want. Most employees feel that five weeks of paid vacation (including their sick days) in addition to the statutory government holidays is about right.

To be sure they take this time off, force them to or they lose it. The idea is to recharge your batteries regularly and not stockpile the time and have a meltdown. Give them five weeks time off but make them take all five weeks of time during the calendar year.

Take the other two weeks (10 days worth) by adding one extra day to each of the three day long weekends we get from statutory government holidays.

The Hard Choices

It’s the end of the month. You’re faced with the hard choice of either making payments to your suppliers in order to keep yourself in business or making payments to the IRS and closing up shop. Which do you choose?

You don’t have enough cash in your accounts to make payroll this week. Are you going to borrow more money to keep your employees paid? Are you going to have to let some of them go? Which ones?

You’re steadily losing customers to a competitor. Do you throw every spare dime into marketing to attract some of them back or do you start cutting the size of your business in order to remain competitive with the customers that you do have?

Here’s the real truth of the matter: being a small businessperson means that you are often stuck with some hard choices. Often, it’s a matter of figuring out which of the choices is the least of all evils because, frankly, none of them are good choices.

In my own experience as a small businessperson, I know that the times in which you have to make the hard choice is often the loneliest times for a small businessperson. You’re forced into making decisions that deeply affect the wonderful team of people you’ve built around you, thus it’s hard to ask them for advice. Similarly, asking for such advice in the community of small businesspeople can be a sign of oncoming failure for your business, a sign of weakness that you don’t want to reveal to them.

Where do you turn when you need to make such hard choices? Here are some options, both expected and unexpected.

Many small businesspeople turn to a business analyst or consultant in such a time of need. Such a decision is often itself an expensive one, but it can often point a business owner towards the best solution or reveal options that weren’t clear before.

My personal top option is my spouse. She is often able to see the cold realities of my business and suggest or encourage decisions that I may be unable to make due to my emotional closeness to the situation. She has a wise mind and isn’t held back by the business relationships I’ve built, enabling her to cut through the situation and find the best solution for the long-term health of the business.

The best solution, though, is something you can start constructing while times are good: a circle of trusted advisors.

In my work, I have a small group of people who are engaged in similar businesses in other communities. Although we are not in direct competition with one another, we are engaged in very similar businesses and thus we often face very similar problems and choices.

Over the years, I’ve taken exceptional effort to find these people and connect with them – as well as connect them to each other. Together, we’ve built a brain trust that we all rely on. We use a closed electronic mailing list to send out ideas and bounce them off of each other – in both good times and bad. We often share services with each other, like working together on package deals for business cards or website hosting services.

More than anything, though, these people serve as a strong support network when the chips are down. Most of us in this group have experienced a significant setback or two along the way and we all recognize the value in helping each other when someone in our group experiences a similar setback.

How can you find such a group? Start by locating peer businesses. Look for small businesses that are engaged in similar but non-overlapping markets to your own. Reach out to them. Exchange ideas with them – and give of yourself freely in these situations. Connect the people you meet with each other whenever you can.

Facebook Questions: Small Business Opportunities?

Facebook has joined the likes of Yahoo and LinkedIn with the rollout of a new Q&A product called Facebook Questions. While the Q&A format is nothing new on the Web, Facebook’s more than 500 million users add an interesting twist to the space, and potentially create an opportunity for small businesses as the feature evolves.

"Questions" is still in beta, but if you have it enabled, you can see that Facebook wants to make it a major part of the site. “Ask Question” is now a feature of the Publisher, meaning Facebook places it on the same level as status updates, posting photos and sharing links. It’s also integrated on Facebook Pages, where a new “Questions” tab lets users ask questions directly on the Page that can be answered by Page admins or fans.

Much like LinkedIn Answers, where providing answers to questions that are relevant to your business can be a great way to connect with new people, Facebook Questions also has the makings of a killer networking and lead generation tool. Click on the “Questions” link that now appears in the left-hand navigation of Facebook and you’ll see questions relating to your interests as well as those asked by friends and friends of friends.

To give yourself the best shot at seeing relevant questions here, you’ll want to make sure you list interests in your personal profile that align with the business's industry and core competencies. There are a few other ways to find questions too, including manually entering in a topic, or choosing from suggested topics or trending topics.

Once you find questions that are of interest, it’s important to note that you can answer them as a business. In other words, if you have created a Facebook Page for Acme, Inc., you can respond to Facebook Questions as Acme, Inc. instead of as John Doe. This lets the person who asked the question – and anyone else who stumbles upon it – visit your Facebook Page instead of your personal profile.

As a Page admin, you can also ask questions that are visible both on your Page and in your fans' News Feeds on Facebook. This creates a new way to communicate with your fans aside from status updates and news links that you’re probably already used to sharing. These questions also get indexed by Facebook (Questions are visible to everyone on the site), which means other users could find them and in turn find your business. Unfortunately, these Questions don’t show up on your Wall as of yet – one of a handful of usability issues that Facebook still needs to address with the product.

It’s too early to tell how widely used Facebook Questions will be. A huge user base doesn’t guarantee that users will embrace using the product in completely new ways; a great example of that is Google Buzz, which had tens of millions of Gmail users at its disposal but has largely gone quiet in the months since its launch. Still, Q&A offers some interesting possibilities to both engage current customers and potentially reach new ones, so keep an eye on Facebook Questions for future opportunities.

5 Cool iPhone Apps for Small Business Owners

With hundreds of new iPhone apps popping up everyday, which ones are best for small business owners? Here’s a round up of the hottest apps for SBOs. Let us know what you think!

Scanner Pro, basically a scanner in your pocket, is perfect for those who need to scan on the go.

“We use it quite a lot,” said Ashish Toshniwal, founder and CEO of eight-person Y Media Labs, a Redwood City, Calif.-based iPhone app developing company. “Scanner Pro allows you to take a photos of a document through iPhone and then save it as a PDF. You don’t need to go through the pain of scanning a document and then converting it. Scanning is much more cumbersome than taking photos.”

Helping to make the lives of small business owners easier, Scanner Pro can scan multiple page documents, send scans by email and set custom page sizes.

If you have digital files saved in several different places, it might be time to check out Dropbox. The technology allows small business owners to manage their files in one system. Users can download the software online, then access Dropbox files on all digital devices, including the iPhone.

“Instead of putting documents in ‘My Documents’ on my hard drive, I put them in Dropbox,” said Toshniwal. “For example, I put all of my proposals into Dropbox and if I meet a client face to face, I can pull up the proposal on my iPhone or iPad instead of printing it. It is much more convenient. You don’t need to carry your documents; you can access everything electronically.”

Hoover’s Near Here merges old school, door-to-door sales with cutting edge technology to help business owners find leads on the go.

Created late last year by Mutual Mobile, an Austin, Texas-based iPhone app developer, the technology provides information on nearby businesses while out of the office.

“Lets say I have a meeting with a client in a different city,” said John Arrow, president and CEO of Mutual Mobile. “When the meeting is over, I can search for similar companies located nearby that I should drop in and see. It works across all verticals and business owners can search for companies based on a lot of different variables.”

Small business owners can now process credit card and cash payments on the spot with Square. After registering online, users receive a small hardware device that plugs into an iPhone and can read credit cards, eliminating the need for costly swiping machines.

“Previously, business owners used to need hundreds of dollars of credit card equipment,” Arrow said. “Now you can take a credit card over the phone and key it in accordingly or swipe it on the go.

“I see people using Square all over Austin. Here, there are a lot of street vendors that sell food but don’t have the money for a credit card machine. Now I will see them with their iPhone or iPad and their Square devices attached.”

Salesforce.com, a customer relationship management (CRM) tool, offers customizable mobile access to pertinent business information with the Salesforce Mobile iPhone app. With the ability to review client information before meetings and respond to leads and requests, the app allows owners to spend more time out of the office, generating new business.

“We have a lot of people contacting us everyday and we use Salesforce Mobile to track customers, make sure we get their information correct and assign the relevant person on our team to contact them,” Arrow said.

Download cost: Free for Salesforce.com customers.

On the go? Find this and other OPEN Forum articles through your mobile phone or Blackberry® or through the new OPEN Forum App for iPhone® from American Express. Visit openforum.com/mobile.

Top Retirement Plan Strategies for Small Business Owners

Jean Chatzky will be covering a variety of different topics in this space every month. Come back next Tuesday for the third article in this month’s Retirement series. Please leave your retirement questions as comments below and she will address several of the questions at the end of the month.

Recent research has clued us into the one thing that is working above all others to make retirement planning a success: Having someone else force you to save. A new study from the Employee Benefits Research Institute shows that when workers are automatically enrolled into 401(k)s or workplace retirement plans, 80 to 90 percent of employees participate in the plans and there’s only a 20 percent chance of running out of money in retirement. In situations where you have to pull the trigger yourself, there’s a 50 percent chance of running out of money in retirement.

That spells trouble for small business owners – and their employees. Why? Because participation in retirement plans is significantly lower at small companies, says EBRI’s Jack Van der Hei. At companies with fewer than 10 employees, only 12 percent of the workforce participates. At companies with 10-24 employees, 22 percent participates. And at companies with 25-99 employees, 34 percent participates. “It’s absolutely devastating how low they are for very small employers,” Van der Hei says.

So what can you do to turn the odds in your – and your employees – favor? You can commit to getting started, says David Wray, CEO of the Profit Sharing 401(k) Council. One of the reasons small business owners shy away from retirement planning is that the landscape is more complicated than it is at larger companies. The silver lining is that you have more choices and are able to sock away substantially more money than employees of large companies – if you do it right. Wray suggests small business owners approach their retirement planning needs in stages.

Stage 1: Fledgling Business. At this point in your life and the life of your company, you – as the owner/manager – are likely working day and night. You’re probably taking little salary while pouring every last resource back into the business to make it successful. That’s one of the reasons plan participation at companies with less than 10 employees is so anemic. Wray says don’t sweat it. “I don’t think it’s realistic for businesses less than 3 or 4 years old to have retirement plans,” he says. “The owner can’t be distracted by this. They have to focus on the outcome.” That said, if you’re not going to have a plan, I want to encourage you to think about putting at least some money into an IRA. You can put up to $5,000 into a Traditional or Roth IRA this year, $6,000 if you’re age 50 or over. (Single filers with modified adjusted gross incomes over $120,000 and married filing jointly filers over $176,000 earn too much to get into the Roth). Wray says I’m dreaming. “They can have an IRA,” he says. “But what I see is that these entrepreneurs are putting every last dollar back into their businesses.” Still, you can’t fault a gal for trying.

Stage 2: Business Off The Ground. In this stage of your business life, you’re hiring real full-time people and they want to know: Where’s the 401(k)? Where’s the health care plan? What are my other benefits? And you start to think: I want to have loyal committed workers, I need to have a benefit plan. The two options you'll want to consider:

To make your decision and get started, you’re going to want to get help. Start with a recommendation from your business accountant and go from there.

Stage 3: You’ve been in business for a while and you’re thinking about retirement. At this point, you’re going to want to supercharge your contributions for you (and your spouse if he or she is in the business, too.) This is where a more complicated 401(k) plan design becomes effective, says Wray. “With the right demographics, you can contribute 6 percent for your employees but the maximum of $49,500 for the owner.” The issue is that if you skated through stage 1 and stage 2 without focusing on retirement, you might be profitable now, but you really need to save, save, and, oh, save some more. The other type of retirement planning that needs to be done now falls under the heading of exit planning. This is the time to start thinking about whether selling part or all of the company – perhaps to the people who have worked with you to grow it – makes sense. It’s not only a feel good solution, it can be the very best way to boost that retirement stash.

Beyond Foursquare: 5 Location-Based Apps for Small Business

Foursquare is teaming up with megabrands like Starbucks and Jimmy Choo, but smaller businesses can find a niche with smaller location-based services, as well.

Working with location-based apps will help prepare your business for the day when checkin apps are mainstream -- and depending on when Facebook decides to roll out their own checkin features, that day could be sooner than you think.

Location-based apps help you reach out to consumers in your neighborhood. They let you offer timed and targeted special offers to the people who are best-suited to respond to them. And when conducted at a small scale as part of a larger marketing mix, location-based campaigns can offer valuable insights and even some decent ROI for the bottom line-minded small business owner.

Check out these five location-based applications, and be sure to let us know in the comments about other apps you use or that you've noticed. We'd also love to hear how your small or medium-sized business has integrated location-based marketing.

The Drill-Down: Whrrl's main feature is Societies, real-world groups that revolve around specific passions or interests. There are Societies for gourmands, bicycle enthusiasts, parents -- just about anything you can imagine. Users make recommendations to one another, and they earn points when other members take their suggestions. The more points a users earns, the more influential he or she is, and the more likely he or she is to win rewards.

Whrrl also uses checkins, but as noted, these aren't the main part of the application.

How Businesses Can Play: Because of Whrrl's system of recommendations and influence, word-of-mouth marketing and real-world activation of special offers are already baked into this app. Brands can offer promotions called “Society Rewards.” Essentially, these rewards constitute a loyalty program that starts with online interactions with likely fans and ends in real-world physical presence at your business.

Society owners can set up prizes and a time frame for the program's duration. For example, if you own a restaurant and a related Society, you can set up a prize of dinner for two to be awarded by the end of the week. Users then check in to get a chance at winning the prize.

The Drill-Down: Brightkite lets users check in and post comments from just about any location. It also gives its users access to a wide range of features including photo-posting, messaging, comments, tips, tiered rewards, and group chat capabilities. It's a perfect choice for users who want a more interactive, social experience than Foursquare.

This app's broader set of features also makes for an interesting gamut of possibilities for creative-minded marketers.

How Businesses Can Play: No stranger to business and brand partnerships, Brightkite specializes in highly targeted, relevant, and effective media placement.

The app can target consumers by precise geography, by behavior and within a given time frame. You can choose to find people in your city or within a given radius of your business. You can choose to reach out to people in a type of location, such as a bar or a hair salon. You can target consumers who are hanging out in groups of two or more, who belong to a certain age group or who speak a certain language. And you can limit your campaign to a given week, weekend, day or even time of day. In other words, you can drill down to reach the exact people you want to find based on just about any variable Brightkite has.

The company can also help you reach out to your friends and neighbors locally, letting nearby Brightkite users know about special deals and promotions.

The Drill-Down: Gowalla is a checkin app that lets users leave tips and complete multi-stop trips to earn virtual items. The app has a travel/adventure theme and features passport stamps as its main currency. Some of the app's virtual goods can be redeemed for real-world items.

This app started gaining traction around SXSW 2010 and is considered to be one of the top contenders up against Foursquare.

How Businesses Can Play: Creating Gowalla trips in your neighborhood or city is a great way to start using Gowalla and encourage interaction from local users. Many brands have also worked with Gowalla to create in-game virtual items.

For example, Missouri's Springfield Regional Arts Council created trips around local theaters and art galleries; users earned special items by completing them.Vail Resorts in Colorado has created several trips; one highlights local attractions, and another points out specific points of interest and fun things to do at the resort. The Washington Post has made several local trips and tours around their readers' interests, such as dancing or burgers.

A Gowalla trip or branded virtual good could be a fun way to bring more Gowalla users into your store or restaurant, especially if your business is linked to other local businesses. You can also contact Gowalla to arrange for a special promotion for your business.

The Drill-Down: Loopt actually encompasses a suite of applications, including Loopt, Loopt Mix, Loopt Pulse for the iPad, and Loopt Star, a Facebook game with special rewards and achievement perks. It uses a checkin mechanism that shares a user's location, and helps friends connect and discover new locations. It also integrates with many other web apps and information services, including Zagat, Citysearch, Bing, TastingTable, Zvents, Metromix and SonicLiving, to give its users a really broad array of functions and features.

How Businesses Can Play: Through Loopt Star, you can create customizable rewards, both virtual and real-world. Your promos can range from free products, coupons, and upgrades to virtual goods that still help to create more foot traffic to your business. Loopt also gives businesses access to highly targeted advertising opportunities with special offers that can be directed at specific locations or venues.

The Drill-Down: SCVNGR is a location-based social game. Users earn badges and points for checkins. Each location in SCVNGR contains a list of "challenges" and associated points: check in, snap a photo and leave a comment are among some of the most common challenges. Additionally, owners of a location or "regulars" at that location can also create their own challenges and pursuant points.

In addition to points, users earn rewards for checkins, challenge completions, and other actions.

How Businesses Can Play: This app's rewards program is sophisticated and will help you reward customers based on progressive actions. You get to decide how many rewards to offer at your business location or locations, how many points your customers will need to earn to unlock a reward, and whether or not that reward can be redeemed more than once. You can also set expiration dates on rewards.

In addition to challenges and rewards, you can also build "treks" to connect multiple places; an example would be the Minnesota Vikings' promo trek to get fans pumped during off-season training.

These five apps are great options for small business owners looking to explore location-based marketing. Which apps would you add to the list? Let us know in the comments below, and include some details about how small businesses can get involved.

How Bazaarvoice Beat the Odds

Austin has a thriving tech startup community, and there is perhaps no better representative of its unique entrepreneurial culture than Bazaarvoice — and we love our hometown heroes. The day I read on the Bootstrap Austin mailing list that Bazaarvoice had landed Walmart as a customer, I beamed briefly with that sort of "hey-I-know-those-guys!" pride.

At first glance, Bazaarvoice's offering could easily be misconstrued as nothing extraordinary. They have three core products: Ratings & Reviews, Ask & Answer (Q&A), and Stories, a tool for customers to share their experiences about a brand. Are they even an application? Or just a couple of features in an application? There have numerous competitors offering similar products. There are even dozens of open source applications that, at first glance, can add those features to a website. If I had heard their elevator pitch in 2005 I probably would've told them they were nuts to try to make a business out of that.

And yet, business is booming at Bazaarvoice. They now have over 600 employees worldwide (a 60 percent increase in the past year) and have worked with more than 850 organizations, including some of the world's best-known brands, across a wide variety of industries. They're the global market leader, and only five years old.

So how did they take such a simple idea that was already being done by so many others, and turn it into one of the most successful tech startups of the past few years in Austin or anywhere else? As the saying goes, it's not what they do, but how they do it.

Simply put, the timing is right. Bazaarvoice addresses and accelerates one of the largest transformations in the history of commerce: the growth of online customer-to-customer interactions. Beyond simply making these conversations possible, they help costumers connect in ways that greatly benefit the brands they work with.

With 100 people in R&D, Bazaarvoice is able to focus on the future like few organizations can. They adhere strictly to an eight-week development cycle, and their software as a service (SaaS) model allows them to simultaneously roll out innovations to all 800+ customers, six times a year. While the core product team focuses on incorporating their clients' feedback, a separate group, Bazaarvoice Labs, looks beyond the eight-week cycle, experimenting with cutting-edge technologies that may define the future of social commerce.

When you're offering a commodity product, service has to be your competitive differentiator. Ryan Cush, VP of Client Success, North America, explains: "We think of ourselves more as strategic advisers than a technology vendor. Bazaarvoice is in the unique position of serving more of the world's leading brands, large and small, than any other provider. This gives us both the scale and the industry perspective to provide unique, industry-leading, data-driven insights and recommendations to our clients. We take a holistic approach to helping our clients listen and respond to their customers' voices, making best practices, dedicated support and constant innovation central to our service."

Bazaarvoice loves numbers, both internally and for their customers. Industry analyst Jeremiah Owyang once said of them, "I take about 300-400 briefings a year. Very few can give me hard ROI numbers. Bazaarvoice does — that's truly social commerce." It helps that founder and CEO Brett Hurt was also a co-founder of Coremetrics, the leading marketing analytics solution for the e-commerce industry, now owned by IBM.

Gerardo Dada, Senior Director of Product Management, explains the company's focus on metrics: "Everyone is trying to measure social media ROI, but the problem is that social media is not a company objective or a business process: it is a set of tools that can support a business strategy. At Bazaarvoice, we have a track record of helping our customers drive real results for sales and marketing: customer conversations increasing sales, reducing return, and providing actionable product feedback. The key is in making enabling conversations to happen in a way that is relevant to both consumers and the brand and in a way that helps consumers with their objectives."

And everyone in Austin knows it. Bazaarvoice has been named one of the Best Places to Work by the Austin Business Journal for the past three years. They prominently share their culture, vision and values on their website, starting with No. 1: People are people, not "resources."

CEO Hurt loves talking about Bazaarvoice's unique culture: "There's nothing more important than culture in driving performance. And it affects everything from how we hire to the fact that every candidate here is tested to make sure that they have the passion for this job and the audacity to change the world with us. Take our vacation policy, for example, which is based on radical trust and respect — the policy is literally 'you take as much as you need.' We even factor in the extent to which employees are living our cultural values into their formal performance measurements, and managers being rated by staff on whether or not they, too, are living our values. I'm honored to work with the people here. They put their heart into this place, and as a result our company is 500 percent larger than what we had projected we'd be at this time. Our culture is every bit as disruptive as our product line, and this is by design."

He also raves about Austin, saying that he couldn't have built the same company anywhere else: "Austin is a very unique place. The people in Austin are much more balanced than other places I've lived. At this company, we have musicians, artists, well-known bloggers and tons of others with amazing skills outside of my own focus on technology. I think that's a reflection of Austin's eclectic community, and companies like ours, those that embrace and cultivate employee passion — even if it's outside of the company's official wheelhouse — come out on top in general, and Austin is the place where this fact is most clearly showcased."

Be Standby Power Smart and Save Serious Money

There is a predator in your office. One that is costing you hundreds — if not thousands — of dollars per year, and unnecessarily so. It is also cumulatively costing the environment in untold ways. That predator is standby power, and if you get smart about it, you can save some serious money.

For a list of appliances you may have in the office and the associated standby power costs, check out this great chart.

By reducing standby power consumption, you will save some serious money, as well as help extend the overall life of our global power supply. For more information on how you and your employees can conserve both resources and money, check out 30 Easy Ways to Go Green in the Office.

Use Stories to Make Your Business Planning Real

It’s a shame how many people get put off by business planning because they think of it like the mess in the Cat in the Hat, which was too big and too tall. To help with that problem I’ve had some success lately in pointing out how much of business planning is about telling yourself stories and making them come true.

One thing stories have in common with business planning is that they both get a bad rap in our world. Stories can describe some very important visions of truth better than, say, statistics. They are closer to the complexity of reality. I like what Harvey Cox says here:

“All human beings have an innate need to hear and tell stories and to have a story to live by.”

So maybe thinking of the story can help you with your business planning – and I mean your running planning process, that happens at regular intervals, that helps you manage and steer your company, rather than just a use-once-and-throw-away document – to think how much of good business planning is driven by telling your story.

The vision statement as a part of the traditional business plan has gone out of fashion. It used to be quite common. Describe your business as you want it to be three or five years from now, and make it a story you can believe is possible. If you start calling it a dream then you’ve probably gone too far.

Now take a step back from the story, and think about what it would take, step by step, to make that happen. How do you get from here, today, to there, in the future? Start planning.

This is closely related to the need to describe success for yourself as a part of your essential planning. Most of us in small business forget how different we are, and how different our goals can be. That’s another story: what’s success for you and your business? Is it going public or coaching the kids’ soccer team? Independence or wealth?

The key, as you move from story to plan, is to get concrete and specific. Go back from the story into the measurable and manageable things you can do to make it happen.

Even before social media and Web 2.0 there was viral marketing, and before that, referral marketing, and going back even further, word of mouth. John Jantsch calls it getting people to know, like and trust you. Seth Godin calls it being remarkable. And I say the heart of it is about understanding the story.

One part of this is the story of the customer with the problem, need, or desire; and how that person finds your business. In good business planning you create these stories and then make them a reality. What was the customer looking for? How did she find you? What was his impression? The better you tell the story, the better your marketing planning. Did the customer want drive-through fast food, and why, and when, and where? Did the customer want a long quiet meal in a romantic atmosphere for a date? Know the story. Create the story. Plan in useful steps how to make it true.

Another important story is the one that the customer tells her friends. How did she find you? What did he think was good or interesting or remarkable about you or your business? What do you want that story to be, and how can you influence that story? This is where the story leads to better business planning as alignment of all the elements of the business with what you want the story to be.

Your business revolves around the story of your history and your values and your team as it grows.

With business planning, you don’t just tell the stories of the past, you also create and develop the stories of your future. Look ahead with your plan, control your destiny, and drive it in the right direction. Go from vision to imagination to focus and step-by-step concrete measurable activities.

Is a Value-Added Tax Heading Our Way?

There is a great deal of buzz starting to generate around the “value-added tax” (or VAT). The concept of a VAT was first proposed by Wilhelm von Siemens, son of the founder of Siemens in 1918. The first country to implement a value-added tax was France in 1954. Today, nearly 100 countries have a VAT. The U.S., so far, is not among the list. But that may change soon.

Many experts are arriving at the conclusion that income tax increases and spending reductions alone will not be enough to bring the annual budget deficit to manageable levels. The solution being offered is the adoption of a value-added tax. The new 1099 filing requirements for 2012 (not to be confused with the 2011 1099 requirements) may be a first step towards adoption of a VAT. If it does happen, business owners need to get ready for a mountain of new tax compliance paperwork.

A VAT is similar to a sales tax with two important differences. First, sales taxes are charged by state governments (and in some cases by municipalities) and only impact transactions that occur within that state. A VAT is charged by the federal government and impacts transactions anywhere in the country.

Second, sales taxes are due and collected on goods and services when they are consumed. The cup of coffee you purchase at the corner deli requires that you (the consumer) pay a sales tax. The deli did not pay a sales tax on the disposable cup or on the beans used to brew your coffee. The deli was just a “middle man” from a sales tax perspective and exempt from the sales tax. With a VAT, every company that touches a product or service on the path from raw material to finished good must pay a value-added tax. The mechanics are a bit tricky.

The best way to understand how a VAT works is through an example. Let’s use a pizza. A family farm grows tomatoes, makes cheese from cow’s milk and grows wheat. It sells these ingredients to a frozen pizza maker for $2.00. The maker then converts these ingredients into a frozen pizza and sells it to a local supermarket for $6.00. The supermarket sells the pizza to a consumer for $10.00.

Assuming a 10 percent sales tax rate, the consumer would pay a total of $11.00, the $10.00 for the pizza plus $1.00 ($10.00 x 10 percent) in sales tax. The supermarket sends the $1.00 in sales tax to the government. None of the companies that “touched” the future pizza pay sales taxes.

With a VAT, each company would pay the VAT rate on the value it added to the product. The way it works is through a two-step process. Assuming a 10 percent VAT rate:

In the case of the VAT, the government is collecting the same $1.00 in taxes and the consumer still pays $11.00 for the pizza. The difference is that the consumer only sees an $11.00 price tag, without knowing exactly how much was paid in VAT.

In reality, the VAT would go to the federal government and the state governments would still want their sales taxes, so the consumer would pay a total of $12.10 for the pizza: $11.00 plus 10 percent ($1.10) in sales taxes.

The recently enacted healthcare reform law includes two provisions that provide clear indications that steps are being taken to enact a value-added tax in the United States. The law includes a national sales tax of 10 percent on tanning services. While not a VAT, it is the first national sales tax in the history of the United States. This could serve as a pilot project for determining how the mechanics of a future VAT would work.

The law also includes an expansion of the 1099 form. Beginning with the 2012 tax year, businesses and freelancers will have to issue a 1099 for every individual or company with whom they spend more than $600. This will create an entirely new tracking system for business-related sales and payments. While the stated purpose is to help close the tax gap, in reality it could serve as a platform for a future VAT.

Tips for Winning the Local Search Game

When prospective buyers want to find products, services, people and experiences these days, quite often they begin their search online – even if they are looking for a business or store right in their backyard.

Working to position your business prominently when local prospects turn to a search engine has become an essential marketing skill.

Winning the local search game is a core step in the local businesses’ ability to compete by providing a superior offline experience. A local business isn’t necessarily going to win online competing with online retailers, but the game for the local business is to show up and rank well so they can drive the local shopper offline and into their business – that’s where the real competitive advantage resides.

Zappos, Dell and Amazon may be fabulous at delivering the goods, but they’ll never be able to deliver the kind of personal relationship that your local boutique can offline.

Winning the local search game is not as complicated as some in the SEO world might suggest, but it does take commitment and focus.

I’ll be presenting my systematic approach to this topic at the MAGIC Marketplace Show in Las Vegas on Thursday Aug. 19^th on behalf of AMEX OPEN. If you plan on attending the show (which is running in full from the 17th through the 19th of this week) I hope you can stop by the OPEN booth.

Discovery– Before you can determine how to win, you must understand what you are trying to win. It’s essential that your tactics line up with what your prospects are actually looking for, saying, doing and wanting. Keyword research, social media listening and in person interviews make up your discovery toolbox.

Intentional content– In order to create an online to offline approach you must produce valuable, education based information – the kind that search engines find and the kind that prospects desire. Blogs, email newsletters, online and offline seminars, and rich deposits of web site information, including testimonials and FAQs are a must.

Social backlinks– If content is king, then links to that content are what puts the crown on the king. Links from social networks, social profiles, bookmarking services, and other bloggers produce the kind of relevance and implied importance that the search engines pay close attention to. This is ongoing work and not something you buy from a service.

Asset deposits– Content sharing sites such as YouTube, Flickr, and Slideshare offer rich opportunities to expose your brand to outlying corners of the web. By spreading and optimizing this content in many of the free resource locals available you set your primary web hub up as a link worthy destination and create more inroads to your business.

Directory assistance– All of the major search players have set up local directories and given you the opportunity to build content rich pages on their sites. Ratings and review sites such as Yelp! and CitySearch also play an important role in the information collecting process now done online. Claiming and monitoring this expanding real estate is a must.

Engagement– To this point much of what I’ve described falls in the category of attracting visitors. Once you do that your job turns to capturing their interest by providing the information they are seeking in multiple formats as well as an opportunity to engage your brand by asking for more information, requesting a quote, leaving a comment or suggesting a feature.

Tracking– I’ve left tracking to last, not because it’s least important, but because nobody seems to want to talk about it. Finding ways to measure what works and what doesn’t is a powerful way to reduce the amount of time and money you invest into your search marketing. Further using tools, like Groupon and Foursquare, that target local shoppers and provide you with hard and fast success data is how you take your tracking to the next level.

Taking Business Insights with You

Around this time last year, my colleague, Marcy Shinder, and a very dedicated team launched OPEN Forum with an invitation to small business owners to try it, test it, and tell us what you think.

We took the feedback we received and made a number of changes, like increasing the breadth and depth of content and recruiting even more expert authors. We even extended the ability to comment and dialogue around our content beyond Connectodex members so that anyone with a LinkedIn account could join the conversation.

There have also been changes to the team: Marcy is now General Manager of Business Charge Cards, and I’m excited to have this opportunity to oversee OPEN Forum. I’ve admired the progress of OPEN Forum over the past year and look forward to being part of its continued innovation.

I think it’s fitting timing for an intro as I now have the opportunity to invite you to test some new developments:

We recognize that many of you visit OPEN Forum through a variety of devices – desktop browser, smartphones, iPads, and so on – and this number will only grow.

According to Gartner Research, by 2013, the combined installed base of smartphones and browser-equipped enhanced phones will surpass the installed base for PCs.* We’ve made these mobile developments to help make OPEN Forum easier to use – wherever you want to use it.

What have we learned? In developing the mobile versions of our site, we learned quite a bit. Small simple things like focusing on the most frequently used features to ensure faster downloads and ease of use within a smaller screen.

Many of our insights began from articles on OPEN Forum itself. For example, Christina Warren’s “Optimizing Your Web Site for Mobile Visitors” and John Jantsch’s “How to Get Your Web Site Ready for the Coming Rush of Mobile Visitors” really helped. I encourage you to read these articles and consider optimizing your web site for mobile visitors.

As I mentioned at the start, I’d love to get your feedback on the mobile experience. What’s working, what isn’t, and what you’d like to see next. You can share your feedback or any questions with me at scott @ openforum.com. I look forward to having this opportunity to exchange ideas and get your suggestions for how we can further improve OPEN Forum. Thanks for continuing to make this such a great place for small business owners to come together.

Scott Roen is Vice President, New Product & Capabilities Development for OPEN, overseeing the development of new card products, reward platforms, and OPEN Forum.

Twitbird: A Twitter Client for the Best of Us

It’s going to be a good week for iPhone users because American Express is releasing an iPhone app for OPEN Forum, which you can find out about on the site's mobile page.

There’s nothing like an app that’s dedicated to a site to make the iPhone reading experience better. I didn’t have a thing to do with the OPEN Forum app, but I want to add some goodness to the iPhone experience by bringing another great app to light.

The name of this app is Twitbird, and it’s a Twitter client for the iPhone and iPad. I discovered it a few weeks ago, and I now use it to manage my Twitter activity on both my iPhone and iPad.

Admittedly, I’m not the typical Twitter user in terms of volume of outgoing tweets and search results, but let me give you my general requirements for a great iPhone/iPad Twitter app.

First, it has to make maximum use of screen space. In other words, I want to see as many tweets as possible at once—at least three on an iPhone and ten or so on an iPad (This is something that French people cannot understand, but I digress.)

Second, it has to work with TextExpander.

TextExpander is a honey of a program that expands abbreviations into full text, and it’s indispensable if you frequently tweet the same link because entering in links is painful on the iPhone and iPad. For example, I enter “zhow” and TextExpander swaps in “This explains how I tweet http://bit.ly/aoIueP?”

Third, it has to let me process a tweet from the columnar view of a list of tweets and not force me to click on a tweet to do things like reply and favorite it. And if a tweet is favorited, I need to see that it is from the columnar view and not have to click on it to see its status.

Fourth, it has to let me get to the top of search results very quickly—that is, without stroking my iPhone or iPad for ten or fifteen times. My search results often reach 200 tweets, so getting to them is a non-trivial matter with most Twitter applications. (The arrow in the bottom left corner of the previous screenshot takes you to the top in Twitbird.)

Fifth, it has to thread tweets so that I can see what I’m responding to. I am involved in so many twonersations at once that I cannot remember previous tweets. And it’s not just my advanced age—it’s also the sheer volume.

So with these basic requirements, I’ve been searching for a Twitter app since the day I got an iPad (April 2, 2010 to be precise), and Twitbird is the app that comes closest to what I want. Here are a few more screenshots to show you additional enchanting features of the app:

Prepare to be Interrupted

You’ve probably figured out that these are all shorthand for national disasters. Not to minimize the human suffering these disasters caused, but they also created a lot of havoc for businesses.

The attacks of Sept. 11, 2001, devastated the national economy in general and millions of local businesses specifically. Aug. 14, 2003, was the date of the Northeast Blackout, when the electric grid in eight states went down. The power outage put approximately 55 million people in the dark and millions of companies temporarily out of business.

We had advance warning of Hurricane Katrina, but no one knew exactly how much it would devastate the business community. And just as the businesses in the Gulf region started to get back on their feet, the BP oil spill happened.

Today’s small-business owners have a very important task to perform continuously and consistently: Be prepared to recover from a disaster, whether of national or regional proportions. Let’s look at three ways to think about the word “recover.”

1. Operational recovery: When interruption strikes, the ultimate survival of your business depends on your ability to pull through quickly. Have a planning session with your team around these thought-starters:

2. Financial recovery: Every small business knows that a significant portion of their working capital comes from the revenue from customers. If that cash stream is interrupted, what are you going to do? Here are a few surefire strategies:

3. Data recovery: Every year, entrepreneurs are using intellectual property more, and physical assets less, in the execution of their business model. Do you have the steps in place to make sure you don’t lose your IP? An internal disaster, such as a virus attack or mechanical meltdown, could happen to any business at any time. You should do all of the following, at a minimum:

Thankfully, most businesses don’t experience nightmare scenarios on the scale of 9/11 or the BP oil spill. But a recent survey showed that three out of four small-business professionals believe they will have a power outage in any given year, while only one in five consider themselves prepared for such an event. And the only people who don’t have a hard drive to crash are those who don’t have hard drives.

So the question is not whether you are one tornado, fire or flood away from being temporarily out of business. The question is whether you’re ready to bounce back.

Jim Blasingame is one of the world’s leading experts on small business and entrepreneurship. He is the creator and host of the weekday radio program “The Small Business Advocate^® Show.” Jim is also a speaker, a syndicated newspaper columnist, and the author of “Small Business Is Like a Bunch of Bananas” and “Three Minutes to Success.”

American Express OPEN and FedEx have teamed up to provide discounts and a comprehensive resource for shipping, business and print services. To learn more, go to http://www.fedex.com/opensavings.

Get More Twitter Followers — Here's How

There are all sorts of reasons to want more Twitter followers – to meet more people and have more conversations, to create a greater reach, and, of course, to increase your online brand. After all, the more followers you have, the better it looks, right?

Yes, we all know that posting great tweets is supposed to be the be-all and end-all answer. But you need people to see and re-tweet those great tweets.

You need followers to get followers; it’s a Catch 22. The quality of your tweets is only one factor.

I have been using Twitter for a little less than a year and have almost 2,000 followers, slowly building my following the old-fashioned way – with good tweets and re-tweets.

Then I figured that there has to be a better way. So I started using the techniques below and, in the last 48 hours I received more than 100 new followers.

Here’s what to do:

1. Follow more people: The easiest way to get more followers right now is by starting to follow more people. Why? Because the twitiquette is that it is proper to follow people who follow you. Ergo, the more people you follow, the more followers you will have. If you follow a lot more people, a lot more people will follow you back.

But that said, not all people you follow will in fact follow you back, so then what? Try this dandy trick:

2. Follow people who have a high likelihood of following you back: Not all Twitter users are created equal. For instance, our pal Guy Kawasaki makes it well known that his policy is to follow people who follow him, and with over 250,000 followers, who are we to argue? Follow Guy, Guy will follow you.

There are other people who similarly have a high follow-back ratio. For example, this article lists “Top 237 Twitter Users Who Will Follow You Back.” Now, I don’t suggest that you blindly follow all 237, instead, cull through the list and see which ones meet your needs and follow those. They will very likely follow you back.

You can create your own list by searching for those people whose follow and follower numbers are roughly equal. That is a sure sign that they follow their followers.

3. Follow people with similar interests who also have a high likelihood of following you back: This is a great trick for creating a lot of highly targeted followers:

Again, I strongly suggest that you not simply and blindly follow all of their followers as that will likely lead to a Twitter terms of service violation.

But by selectively following people who follow leaders in your industry, you tap into people who A) want to be connected, B) have things in common with you, and C) will likely connect to you too.

4. Use hashtags (#) to find the right followers: For example, in my case, I am always looking for great small business tweeters, so I often search for tweets under #SmallBiz. I know I will always find good people to follow there, as well as followers to follow me. You should do the same in your industry.

Similarly, be sure to add appropriate hashtags to your tweets so that they will show up in those Twitter streams and thereby increase your chances of getting re-tweeted (see below.)

5. Create benefits for following you: For example, you can use your Twitter account to tweet “followers-only” specials and coupons. That will attract followers. Or what about this idea: Have a contest from your Twitter profile and then tweet about it. Wanting to be a good member of the Twitteratti, your followers will re-tweet your contest to their followers, and you will thereby get more followers.

6. Get Re-tweeted: Having your followers re-tweet your great content is like getting an unsolicited endorsement from them, and it pushes your name into virgin territory ripe for finding new followers who liked what they read in the re-tweet.

7. Re-Tweet: Use Search.Twitter.com to see which of your tweets are the most popular and then re-tweet those at various times during the day, using hashtags. This will ensure that different people, and new people, see your best tweets. They will then either re-tweet them, or start to follow you, as the case may be.

8. Blast it: Of course, make sure your Twitter profile is part of your email address, linked to your Facebook, Digg, LinkedIn and other social media accounts, and prominent on your homepage.

What Mobile Platform is Right For Your Business?

When I talk with small businesses about technology buying decisions, the question of mobile platforms always comes up – with good reason.

Companies of all sizes are investing significant resources in deploying mobile applications for their staff, as well as building applications for a new generation of mobile users. They need to know what mobile platform is right for them, and for the types of uses strategic to their business.

Here’s my take: When considering these types of purchases, consider the hardware features of the phone to make sure they align with your strategic business needs. You should also consider what applications the phone supports and which ones might be quite useful for your business.

Here's an overview of the four dominant smart phone platforms in order to help inform your business needs.

If the ratio of iPhone users on any given city block is a rough indicator, the Apple iPhone is clearly dominating the market – with consumer users anyway. But hold up, business teams. The device is making more headway in enterprise systems, too, as more business executives adopt the device and request IT support.

However the demand of the iPhone is now more than its hardware features; it’s all about the applications. The major technology trend in the marketplace is that businesses -- especially ones with hosted applications – are developing an iPhone app.

Vendors are all too happy to work with Apple’s software and platform to ensure their applications can be used by iPhone users. Furthermore, companies such as airlines, car rental companies and other industries are enabling their customers to connect with them through the iPhone.

RIM’s BlackBery has been the pre-eminent smart phone for business professionals since smartphones hit the market a few years ago. It’s moved beyond just corporate offices. Solo professionals and consumers also like the BlackBerry for its simplicity and very powerful email functionality.

Although the BlackBerry does not have nearly the applications as the iPhone does, it is playing catch up with its own app store (see link above). Plus, there are many business-specific applications (the ones important to you) for the BlackBerry. It’s not the number of applications that are important as much as knowing which types of apps are important and strategic to you and your business.

The BlackBerry is still regarded by many IT pros as among the most secure mobile device you can use. If you’re in a highly regulated industry, the BlackBerry could be an option for you to consider.

Also, because of its widespread acceptance in enterprise systems – as well the guaranteed support your IT staff can provide, the BlackBerry is among the most popular smartphones for the business set.

Google’s Android operating system for phones is the newest on the market. And it's among the hottest-growing platforms, according to CNET.com and Gartner Research.

The Android, possibly due to Google’s heritage, is one of the more feature- rich phones. For example it has HDMI ports for hooking into larger screens, and free GPS navigation.

All smart phones compete with each other, but the Android is probably the closest competitor to the iPhone than the BlackBerry -- for now.

Since the devices have many similarities, sometimes it really does boil down to which apps you like best and which device supports them. Keep in mind that apps might not work the same on one device as they do on another device.

Windows Mobile and Palm had been the leading mobile platforms for business users for years. Lately, though, not so much. HP just purchased the struggling Palm, whose future software support is in question. Windows Mobile is still quite a viable platform with major support behind it by the world’s largest software maker. That helps.

Plus, there are still many Windows Mobile devices on the market. Microsoft is set to launch Windows Mobile 7 in the fall, but since the product is not out yet, and other great solutions are out now, the Windows Mobile market is a bit stagnated. Finally, you need to ask yourself whether developers are still making as many (or as many good) applications for Windows Mobile as they are for other devices.

When considering a mobile phone for your business, it’s important to know what you want to do with the device, based on your business needs, day to day use, business processes and customer needs.

The type functionality of the device is important - camera, ports, data input and etc. But so are the types of applications that can be used on the device and how they help support your business.

Ramon Ray is founder, editor and technology evangelist for SmallBizTechnology.com, a popular Web site dedicated to helping small businesses make sense of their technology purchases.

7 Tips for Choosing a Business Broker

For serial entrepreneur Jane Angelich, deciding to sell the San Francisco uniform store she had owned for 13 years was easy. Finding an attentive business broker to help with the transaction proved to be less so.

"The first one I hired produced nothing," says Angelich, who's now CEO of Supercollar, a company that sells a dog collar with a built-in leash. "He pawned me off on an associate that worked over two hours from San Francisco and had no desire to make the trip to show the business. They weren't showing me buyers, and they weren't even coming up with clever reasons why they weren't showing me buyers."

It wasn't that Angelich hadn't sniffed out the guy in advance. She'd researched him online and off. She'd checked his references. She'd made a point to meet him at his office to ensure she wasn't "dealing with someone who was sitting in his garage."

After six months of getting the runaround, Angelich ditched her deadbeat broker and found a new one. Within a month, she had three attractive offers and sold her business. Still, the many weeks she'd wasted stuck in her craw.

How can you avoid losing valuable time to a bogus broker? What questions should you ask to ensure you don't get in bed with a dud? And what red flags should you watch for?

You want a broker with a proven resume, not someone who just hung their shingle yesterday. Finding a broker credentialed by the International Business Brokers Association offers this assurance. To become an IBBA-sanctioned Certified Business Intermediary (CBI), brokers must log several years on the job and dedicate dozens of classroom hours to their training.

It's not enough to Google any brokers you're considering using and call their references. Part of the vetting process includes making sure your broker is the right fit for your business. For starters, you want a broker who specializes in selling the type of business you own, be it a dotcom, a restaurant or a graphic design firm.

"Each industry has its own unique culture and requirements and knowledge base," says former business broker Mary McCarthy, who's now president of Your Management Team, a small business consulting firm, and chairperson of the Columbus, Ohio chapter of SCORE. "A broker that says 'The industry doesn't matter, I can sell any business' would be something to question. Because can they really represent you and sell your business the best?"

Also critical is whether the broker you choose typically handles transactions of your size. "If they handle $10 million deals and your deal is $3 million, they're not going to give you the level of attention you need," says Vanessa Troyer, co-owner of high-end mailbox manufacturer Architectural Mailboxes, who in 2008 sold a million-dollar online business for with the help of a broker.

Getting a clear picture from the get-go of how the process will unfold is critical. "Ask what the steps will be in valuing your business, preparing the business for sale, uncovering potential buyers, and following through," McCarthy says. For example, after parting ways with her first broker, Angelich began asking the brokers she interviewed whether they planned to personally handle all aspects of her sale or farm out her account to an associate.

Another key detail to suss out: how the broker will keep you apprised of interested prospects and the transaction status. "You want to have weekly status reports, calls, and updates," says Toby Corey, who's currently using a broker to sell his company, the sports entertainment site NBX Inc."If you allow yourself to be back-burnered, you're not going to get their mindshare."

Typically, business brokers make their money by collecting a commission on the sale of your business. "If anybody asks you for money up front, that's a big red flag," Troyer says. "That's not common protocol."

Although the average commission brokers make is 10 percent, like everything else in business, that figure sometimes can be negotiated. "For instance," McCarthy says, "if you know somebody that you think would be the perfect buyer, a broker may negotiate a lower rate because they're not doing as much work for you. It never hurts to ask."

In all likelihood, your relationship with your broker will be a lengthy one. On average, it takes nine months to a year to sell a business — from the time you and your broker start assembling a comprehensive marketing package for your business to the time the sale closes.

Although it's customary for brokers to ask their clients to sign an exclusivity contract, that doesn't mean you have to sign your life away for the next year-plus. "Six months is probably the minimum you're going to get," says Troyer, who was happy to commit to her broker for half a year. However, Angelich negotiated a 90-day contract with the broker who sold her business, with an option to renew for 90 days more. "You can tell almost anything in 90 days," Angelich says. "You've given somebody a reasonable time to perform. And if they're not showing you their best stuff at the front end, it's unlikely they will later."

While you don't need to bring your broker home to Mom, you do want to hire someone you're compatible with. "You have to work really well together as a team and have a good chemistry," Corey says. "You want to see the world the same way, see the opportunities the same way, because it really is a partnership to get your business sold."

Or, as Troyer puts it: "If you're uncertain about somebody, go with your gut. Trust your instinct that got you where you are today."

5 Super Easy Ways to Promote Your Business With Video

You may have heard the saying that content is king. But if you had to get specific about the online environment, the saying might be that video content is king.

The reason is simple – most people will respond much better to moving pictures and a story through video than any other type of content online.

If you are like most small businesses, though, video is likely the last type of content that you are actively using online to promote your business. After all, it seems much harder to produce than it really is. In fact, video can be the easiest type of content to create if you follow a few basic rules.

1. Get an easy to upload camera (like a Flip Cam). This will make the process of getting your video online much easier and make it more likely you will actually follow through and do it. The downside is that you don't have many editing options with the software provided, so make your shots count.

2. Shoot exactly what you want so you don’t need to edit anything. The biggest time investment in using video is having to edit afterwards, so as much as possible, film things in one take and only get what you will use.

3. Make sure to get close enough for good sound. Video quality is no longer the major issue with online video as long as you are using a real camera and not a mobile device. The issue with quality usually comes from sound – so try to get close enough so everything you want to hear will be audible, or invest a bit of money and buy an external microphone.

Once you have these rules down, you are all set to create videos to promote your business. The first part of having everything ready to go is the easy part. The harder part is answering the question about what your content should be. Let’s look at a few examples of how to make this process easier.

1. Answer your customer’s biggest questions. In any business, you likely field the same questions from customers or potential customers over and over. Whether your business has a product or service to sell, if you can use video to effectively answer those most common questions, then you can not only use video to promote your business but also as a way to field those questions in a more engaging and shareable way.

2. Creating an “unboxing” situation. The art of “unboxing” is becoming popular online as a way to experiencing a product without buying it. In an unboxing video, someone simply places a camera on a tripod and films themselves unpacking a product so you can see the packaging, what comes in the box and virtually watch the experience you might have if you did purchase the product. These types of videos help demonstrate to potential customers what their experience might be if they did purchase your product and though it is better suited to tangible products instead of services, the concept could be extended to services as well.

3. Do an office tour. This is exactly as simple as it sounds. While it may seem like a trivial exercise, simply letting potential customers have a virtual look around your office can do wonders for helping them to see you as a real business with real people instead of a yellow page ad or a static website.

4. Interview your best customer. Not everyone will be able to get their customers to talk on camera, but if you have a customer that you have a particularly good relationship with, ask them if they would be willing to talk with you in a short video to share what they like about your business and why they might recommend you.

5. Demonstrate your product or service in action. Think of this as a simple demo video, where you can show how your product works or demonstrate the thinking behind your services in action. Ideally, you can just capture something that you already do every day on video.

Using video online can help you bring your small business to life and it does not need to be a daunting task requiring a professional crew and big investment. So what are you waiting for?

Finding Legal Representation for Your Business

Finding legal representation is one of those tasks that many small business owners put off until they actually need that legal representation — when there is a crisis that needs a lawyer's attention. But by spending time on finding the right legal representation for your business when you're not under the gun, you can make sure that you're working with the person who can best represent your company, as well as head off potential problems before they impact your day-to-day operations.

When you have time in which to learn more about a particular lawyer, it's worth starting by looking into those lawyers that your contacts recommend. Most small businesses need general legal help: assistance with planning the company's growth, writing contracts and the sort of business matters that go smoother when you can consistently work with the same lawyer. You'll likely find that most business owners you network have a go-to-guy — a lawyer who they turn to for most legal matters that come up. Asking for recommendations within your network can be the simplest way to find a lawyer.

On top of the ease of relying on recommendations, you will be able to sort through the stack of options available in your area much faster if you have some indication of which lawyers do well at working with small business owners. There are many lawyers who will take on general legal matters without much trouble, but when you can find someone who deals with small business situations on a regular basis, you can be assured that you're getting a lawyer especially familiar with the issues that small businesses face on a regular basis.

When you've narrowed down your list to just a few names, it's useful to interview the lawyers you are considering. While they are professionals and will work independently, making sure that you'll have a good relationship from the start makes an interview an important step. In your first discussion, it's important to establish the parameters of what you need, the costs you can expect and how the lawyer will handle matters for you. If you have a specific legal issue you need to address, lay out the matter for the lawyer and ask how he would approach it.

It's a good practice to interview more than one lawyer, when possible. Comparing their responses can give you a good feel for who will be the best legal representation for your business.

By finding legal representation that you can work with for the long-term, you have access to certain benefits that are unavailable to a small business that just goes through the search results every time there is a problem. You can build up a relationship with your lawyer, much like you do with a CPA or other professional adviser. Your lawyer can become very familiar with your business and give you a head's up if there is potential for a problem. You may be able to take preventative measures that are far less expensive than actually taking a matter to court.

There will always be legal situations that the lawyer you work with on routine matters won't be able to help you with. However, if you have a good working relationship with your legal representation, you can get a recommendation for the specialized help you may need. If, for instance, you need a tax attorney, you can get tips on which firms are most adept at cases involving small businesses, as well as who will be the best fit in terms of personality.

Depending on your legal needs, you may be able to find a better financial situation when you're working with a lawyer on a long-term basis. Many lawyers are comfortable working on a retainer, allowing you to make advance payments to cover hourly rates and fees on routine matters. There are many regulations governing the specific manners in which a retainer is handled, but when you have an ongoing relationship with a lawyer, you may be able to negotiate a lower rate. Fees can go beyond a simple hourly rate when working with a lawyer; your legal representation may have different rates for time spent in the office versus time spent in court, as well as costs such as fees and costs passed on to you. Some lawyers offer different financial approaches, as well, such as guiding a client through legal matters rather than doing the lion's share of the work.

It's not always possible to make time to hunt for a lawyer when you don't actually need one, leaving you in a position where you have to move fast if a legal crisis shows up on your desk. If you don't have time to find someone who is a good fit with your business, finding someone who is a great fit with your problem is a good shortcut. You may not work with such a lawyer in the long-term, but finding the right lawyer for a particular problem is relatively easy.

You can simply search for a lawyer's specialty. Finding legal representation based on a recommendation is ideal, but not absolutely necessary, since you're not looking for someone you can work with on a long-term basis.

Comparing prices can also be a useful indicator, but if you need to resolve a specific problem, cost may not be the most important aspect. The interview process is crucial, however. Getting a feel for how an individual lawyer would approach the situation you're facing can directly lead you to the legal representation that will work hard to win your case. And if there is a situation where taking the matter to court may not offer the best income, the interview process is the only way to find a lawyer who will recommend other solutions. After all, if you simply go in and ask a lawyer to represent you in court, you aren't going to hear many alternatives.

From Details to Vision

Everyone who puts forth the energy and ability to start a new business has some large goal in mind. It can be as simple as pure money, but for some, the goal can be to truly provide the best service or products in a given niche. For others, it may be to create a lasting personal legacy. Some businesspeople even see their business as a route to help create the kind of social or political change that they want to see.

The challenge is connecting the day-to-day elements of running a small business to the large dream that we all have.

I’m a small business owner with two distinct goals. The first is to establish enough stable investments so that my family can survive without the need for steady income directly from the business. The second is to build a foundation that helps families with the incredibly complex adoption process. I guess you could say that my goal is to build stable, happy families, starting with my own.

How do these goals tie into the day-to-day decision making process of my business?

First, whenever I have to make a strategic choice of any kind with regards to my business, I keep those two large goals in mind.

So, for the first goal, whenever I have an option to take some profit or other resources out of the business and into a stable investment that returns a steady amount every year, I do this. Sometimes it means that I have to return money to the business in some form or another, but as time goes on, I will require less and less profit from my business to fund my own personal living expenses. That means I’ll have more business resources to fold back into the business to grow it – or more resources with which to push myself to a level of complete financial independence.

Second, my business is designed to maximize my ability to reach that goal. In other words, because my personal goals tend towards stability, my business decisions also tend towards stability. I much prefer steady, slow-growing businesses that will steadily produce some income than businesses that are shooting for incredible growth with the potential for incredible failure. I prefer businesses with low operating expenses as well – again, even if that means foregoing profit.

Understanding these personal goals up front makes it much easier to run the type of business I want to run. If I were a more adventurous type with more adventurous goals, I’d be much more likely to jump into more adventurous businesses. The key is understanding who I am before making major business decisions as a business owner.

Who are you? What are your large goals in life? How does the business you’re running relate to those goals? The better you understand that connection – and the more time you spend reflecting on how your big personal goals relate to the nuts-and-bolts financial choices of your business – the quicker you’ll arrive at the kind of results you want to achieve.

How to Rekindle the Entrepreneurial Spirit

Over the past year I’ve had the chance to work with a number of small to medium sized companies, mostly private. Coming from a background of working mostly with much larger, publicly-traded organizations, the change has been refreshing. Things happen quicker, ideas flow more freely, and the atmosphere is in general more invigorating.

Still, I’ve detected a sentiment, a feeling, sometimes verbalized, but mostly unvoiced. As business begins to boom, or, more accurately, re-boom, and the danger of survival is replaced with success and more abundant resources, it goes something like this:

Our problem is that the entrepreneurial spirit isn’t quite what is was when we were a start-up. Sometimes it’s completely M.I.A. More and more we seem to need more money, people, and space to innovate. But that’s not how we started. Okay, so we didn’t start in the proverbial attic or garage, but we started with little of everything: money, space, labor. We had a goal, and a passion for reaching it. Those limits made us more creative and resourceful than we are today. Today, the addiction to resources is blocking innovation.

I think there’s a relatively simple (not necessarily easy, mind you) fix. But before I get there, let me try something with you. Ready?

1. Stand up, feet planted shoulder width apart, arms straight out at your sides, elbows locked.

3. Sit down your right arm and mentally mark your stopping point on the wall. Remember that mark.

5. Repeat the exercise, stopping when you think you’ve met your previous stopping point.

My bet is that you surpassed your previous mark. Point being, we generally don’t know what our potential is until we put our capacity on trial. We don’t stretch as much as we’re capable of. The recession put everyone’s capacity on trial, but as the even keel returns, we need to constantly stretch and re-stretch our capacity in positive ways to move the business forward.

I think it’s that we have to treat resources constraints the same way artists do. All artists work within the confines of their chosen media, and it’s the limits that spur their creativity. The canvas edge, the marble block, the eight musical notes—the resources are finite. They always are! So it’s how we view and manage them that makes all the difference. And that’s the billion dollar question: Are limits preventing innovation, or enabling it?

A team that doesn’t thrive on the challenge of limitations is a red flag. It signals an inherent fear of failure in your company. And that spells danger for innovation, because most real innovation springs from failure and conflict. The bigger and more successful a company gets, the less they have tolerance for either. So they mismanage a valuable source of new thinking by adding a buffer zone: higher budgets, more layers, and lower expectations.

Unfortunately, success usually isn’t what breeds the kind of thinking that produces the extraordinary results needed to add value and keep competitors at bay. In fact, success can often generate a defensive posture that discourages the very behavior that created it. It can absolutely stifle innovation.

Innovation—the specific tool of the entrepreneur—demands exploiting limits, not ignoring them!

So if the entrepreneurial spirit is fading or missing in your business, reset the bar by recreating the kinds of limitations that drive new thinking. Those limitations are called stretch goals—big, hairy, audacious goals. Or, as they are perhaps more commonly known, BHAGs. (Now set them!)

Evaluate Your Business Like Warren Buffett Would

"Accounting is the language of business, and you have to learn it like a language… To be successful at business, you have to understand the underlying financial values of the business." –Warren Buffett

Warren Buffett is the most successful investor in the world because he knows that great companies make great investments. Identifying great companies requires an understanding of accounting and the ability to read and interpret the basic financial statements: the income statement, balance sheet and cash flow statement. Analyzing, tracking and comparing key numbers from these statements provides the clues that will help you identify great companies.

A financial ratio compares the relationship between two figures from your financial statements. These ratios – when interpreted correctly – tell the story of your company. They tell us how the story of your company changes over time (for better or worse) and how it compares to other companies in your industry and other industries. Different sources classify (and name) financial ratios differently. I think the best way to classify them is based on the questions they help you answer.

An important measure of risk is your company’s ability to pay its debts on time. To do this you need cash or other assets that can be turned into cash quickly.

The quick ratio measures the ability of the company to pay what it owes in the short-term with cash and assets readily convertible into cash. Higher values are better.

The current ratio is similar to the quick ratio, but includes all current assets like inventory. It is a less stringent measure of risk than the quick ratio. A minimum ratio of 2 is desirable.

Current liabilities to owners’ equity = Current liabilities / Owners’ equity

Current liabilities represent money lent to the company for the short-term while owners’ equity is the value of the owners’ stake in the company. This ratio indicates how much “skin in the game” the short-term lenders have relative to the owners. The larger the number, the riskier the company is. This ratio should be below 0.8.

Beyond how much money your company makes, profitability ratios measure the return for investors and for the assets used to make the profit.

Net income represents the profit that remains after all expenses, including taxes, are deducted. When taken as a percentage of revenues or sales, it represents the profit margin. Higher values are better.

Return on assets compares the profits generated to the total assets of the company. It’s a way to determine if the company is generating sufficient profits to justify the investment that has been made. For example, a company that sells $100 and has a net income of $25 would have a 25 percent profit margin ($25 / $100). That is good.

If the company, however, has $10,000 in assets, then the Return on assets is only 0.25 percent ($25 / $10,000). Clearly the company is not profitable enough since it takes a many assets to generate that profit.

Equity represents the capital of the owners. It includes the money invested as well as any profits retained by the company. The company must generate sufficient returns to justify the capital that the owners are risking in the company. Otherwise it’s not worth it for them to keep their capital in the company.

Efficiency measures how “hard” your company has to work to generate sales make a profit and get paid.

This ratio measures the relationship between your sales and your inventory. If the ratio is too high, it means that you are selling out of your inventory too quickly and may be missing out on additional sales if you maintained higher inventory levels. If it’s too low then perhaps you are overestimating your demand projections, aren’t pricing your products correctly or are experiencing some other problem.

Sales to net working capital = Revenues / (Current assets – Current liabilities)

Working capital is the difference between your current assets and current liabilities. This ratio measures how efficiently the company is using its working capital to generate sales. If the ratio is too high, it could be a sign that your company lacks sufficient working capital to operate safely.

This is by no means an exhaustive list, but it certainly is a start. A great way to track these ratios over time is by using a management dashboard.

Hybrids — A New Form of Innovation

More and more variety is available in products and services these days. How does anyone come up with something really new? Once in a while a totally new idea shows up. The Apple iPhone with its finger manipulated touch screen was one such “new idea.” This is now being widely copied by most smart phone makers.

There is another approach that has become pervasive in the quest for innovation. That is using “hybrids”—one from each of two or more design concepts—merged to take advantage of the best properties of each. Consider a list of a dozen “hybrids” that have become successful in this regard. Each has a unique and innovative advantage created by combining one or more, older and proven concepts.

1. Automobiles: These highly visible products have merged/combined the use of the gasoline engine with electric motors to improve fuel efficiency significantly.

2. Agricultural Crops: Hybrid seeds (corn was one of the first) were developed to eliminate vulnerability to pests, disease, etc. and offer superior characteristics. Arguments are still raging whether this familiar hybrid has gone too far, but suffice it to say that America’s agricultural productivity would be not nearly so great without hybrid seeds.

3. Golf Clubs: New “utility clubs” are often called hybrids because they use the head shape and mass of a “wood” and the face angle and loft of an iron, making it easier, especially for amateur golfers, to hit balls solidly out of difficult lies.

4. Bicycles: Hybrid bicycles have found a popular consumer niche midway between fat-tire mountain bikes or beach cruisers and lightweight racing/touring bikes. These hybrids offer a more comfortable upright riding position and a stable ride but with less weight and rolling resistance than their fat-tired brethren.

5. Carpet Extractors & Steam Mops: A carpet extractor combines a vacuum cleaner with a shampoo and water dispenser to clean carpets. Combining a floor mop with a heated water supply makes a self-contained hybrid cleaning device for hard surface floors.

6. Decking: Plastic and wood composites have made decking nearly impervious to weather and eliminated the need to treat or preserve the decking at regular (annual?) intervals. Various combinations of materials, textures and structural properties have made this the decking of choice (over wood) for those who can afford it.

7. Pepcid Complete®: This antacid remedy combines a traditional, faster acting antacid tablet with a somewhat slower acting stomach acid reducer in a simple, chewable form—an ideal combination of two different approaches in a single product.

8. Cold Remedies: These have take the concept of “hybridization” to wild extremes, combining decongestants, antihistamines, anti-tussives and pain/fever reducers in a nearly infinite variety of formulas and delivery means (tablets, time-release capsules, liquids, gel-caps, etc.).

9. Juice Boxes: While presenting a recycling dilemma, the laminated cardboard, foil and plastic containers make use of the best properties of each material to form a durable, portable and leak-resistant drink container for children’s lunches.

10. Bi-Focals, Progressive Glasses & Contact Lenses: Combining the visual correction for near, intermediate and distance vision, eye wear can now accommodate a huge range of vision correction. What was once only possible with eyeglasses can now also be done with contact lenses.

11. Retailing: Web based retailing with on-line ordering and in-store pickup or home delivery uses the simplest, most convenient and cost-effective features of each method of selling and fulfillment. A variation used by amazon.com and many other web retailers, is where the products are ordered on its web site but fulfilled by an entirely separate entity on a “drop ship” basis.

12. The iPad/Tablet Computer: This new form of device, which will soon be mimicked by many others, combines the touch-screen convenience of Apple’s iPhone, its user friendly interface, and tens of thousands of “Apps” (to do almost anything) with many features of a portable computer. These devices are making old-fashioned photo albums and music players increasingly obsolete, and will soon threaten conventional books.

In every case above, the hybrid was not a totally new product in itself. However, by merging the best features and performance of older, proven technologies and designs, an even better combination was the result. Thus, “Hybridization” must qualify as an important new form of innovation in growing global marketplaces.

OPEN Mic Podcast: Social Media

From OPEN Mic:
Monocle editor Tyler Brûlé speaks with John Jantsch of Duct Tape Marketing and Mashable's Adam Ostrow on how small businesses can benefit from social media. Hear their advice to OPEN Cardmembers on how to make it work for their businesses.
Download podcast here.

Time is Money, Now Act Like It

You’ve heard it before hundreds of times, usually from someone waiting on you, trying to get you to hurry up.

But time really is money. What it’s worth may vary from person to person, of course. Minimum wage is currently $7.25 an hour. Bill Gates makes about $200,000 an hour, depending on how Microsoft’s stock is doing. But every second of every day has monetary value, whether you’re punching a time clock, running a business, or brushing your teeth. Every minute of every day that you’re not doing something to earn money, you theoretically could be.

A simple estimate of the value of your time is to take your annual after-tax earnings and divide them by 2,000. British economics professor Ian Walker has developed a more precise formula for calculating the value of your time: V=(W((100-t)/100))/C, where V is the value of an hour, W is your hourly wage, t is your tax rate and C is the local cost of living (converted to hourly). This leads to some pretty surprising findings.

For example, in a study Walker conducted, he found that the typical cost of cooking dinner, including the time spent and the cost of ingredients, was £10.77 ($15.72) for men and £9.81 ($14.30) for women, while the average cost of ordering a take-out meal was £5.01 ($7.31) for men and £4.96 ($7.24) for women.

This runs against conventional wisdom, right? Personal finance gurus are all over the media right now talking about how cooking at home can save you money vs. eating take-out. Yes, it can, if what you would do with the extra time by not cooking is just watch TV or something. If, on the other hand, you can work an extra half hour on your business, and that will generate more than the $7 difference in value between take-out and home cooking, then it’s actually a better financial decision to pick up take-out, or better yet, order delivery.

There are potential dangers, of course, of looking at your personal time as a constant stream of cash outflow, especially when you look at the bigger picture. “Sorry, honey, I really can’t go to the park with the kids — it’ll be too expensive,” simply doesn’t work. Eating at home is generally much healthier than take-out. Taking time for relaxation and healthy relationships will make the time you do spend working more productive. And besides… what are you working for?

Still, taking a hard look at the value of both your personal and business time may help you make some changes that both put more money in your pocket and improve your quality of life. Let’s look at a few examples.

Trying to reach people by phone takes extra time, and setting up a meeting is even worse. There’s “time overhead” to use these forms of communications vs. email, and they often stretch out beyond the time you’ve allocated for them. Use email to communicate small chunks or lists of information. On the flip side, negotiating an issue or collaborating on a work product is often more efficient done in real-time. If it’s gone back and forth via email more than a couple of times, pick up the phone Also, communicating by phone or in person help build rapport more than email — operating 100 percent digitally can make you seem cold and impersonal. Know the pros and cons of each medium and use the most appropriate one. Doing so can save several hours a month.

Just about every home probably has a couple of screwdrivers around, but if you do home projects or any of your own repairs, you very quickly realize you’ve got to have an electric screwdriver. The right tool for the job can cut the job to a fraction of the original work. This is equally true in business. That new piece of software may seem expensive, but how much is it costing you in time not to go ahead and buy it? Think an iPad or Kindle is a luxury you can’t afford? How much more work could you get done if you took the bus or subway to work and used a mobile device to have your email or your business news reading all done by the time you get to your office?

Multi-tasking is an illusion — we can really only pay attention to one thing at a time. There’s a time cost associated with switching tasks — anywhere from a few seconds to a few minutes, depending on the task. One of the most important things you can do to improve your use of the time you have is to work in batch mode, i.e., stay focused on one task for as long a period as reasonably possible. Unless it is absolutely essential to your business model, don’t take incoming phone calls yourself; schedule calls via email and block out a time to return phone messages. You can have an open-door policy for your office, but encourage people to schedule a time with you instead. If you work from home, set boundaries with your family about interruptions.

As an employer, you don't want to pay someone $25 an hour to do $8 an hour work. Why, then, do you do it yourself? Think about every routine activity that you spend time on daily, weekly or monthly. Could you delegate it to an administrative assistant? One of your managers? Or on a project, can you outsource parts of it to a web designer, a writer or a virtual assistant?

Sometimes getting something off your plate requires empowering other people beyond their current authority. Author Tim Ferriss talks about this in his book, The 4-Hour Workweek. He had outsourced customer service for order tracking and returns but was still handling product-related questions himself: 200-email per day, taking up the bulk of his day. When he looked more closely, he realized that the bulk of the emails were not product questions, but escalation issues from the customer service reps themselves. So he sent one email to all the supervisors that turned his 200 email per day into fewer than 20 per week:

I would like to establish a new policy for my account that overrides all others.

Keep the customer happy. If it is a problem that takes less than $100 to fix, use your judgment and fix it yourself.

This is official written permission and a request to fix all problems that cost under $100 without contacting me. I am no longer your customer; my customers are your customer. Don’t ask me for permission. Do what you think is right, and we’ll make adjustments as we go along.

Not only did he save 100 hours of his own time per month, customers were receiving faster service, returns dropped, the outsourcers spent less time on his account, which in the end saved him money. As an entrepreneur, it can be challenging to relinquish control, but it will pay out in the long run.

Some things, you really should do yourself. I frequently chauffeur my son, even though my time is “worth” more than my wife’s — doesn’t matter, because that time is one-on-one time with his undivided attention, and I treasure that. But why do things you don’t like doing, that somebody else can probably do better, and cheaper, once you consider the value of your time? I hate housework, and I’m not too fond of yard work. So we have a maid and a yard guy every two weeks. I figure it saves us about 20 hours a month at a cost of $250 — well worth it, whether we choose to spend it working or playing. Unfortunately, it’s not tax-deductible — sure ought to be!

Yes, there’s a time cost to planning, organizing and tracking your time and actions, but study after study have shown that there’s almost always a net gain for anyone other than those with very simple lives. How many entrepreneurs lead very simple lives? Get serious about getting organized. I’m not just talking about keeping a calendar and a to-do list, although for many people, even that’s a good start. Learn and implement an actual system: Getting Things Done (GTD), FranklinCovey, whatever — just do it, and the sooner the better.

525,600 minutes. Your situation and your skills may be different, but you get the exact same amount of time every year as Bill Gates. It’s your most precious resource, because it is the only one that is truly scarce. Be a good steward of it and put it to its best use.

Capital Crunch Hurting Expansion Plans: Study Shows

There’s been much talk about a capital crunch for a while, and now there’s a study to confirm it: A lack of access to capital is hindering businesses’ ability to expand.

The Pepperdine University Private Markets Capital Project surveyed 559 privately held businesses and 1,430 lenders and investors nationwide and found that, although the majority (78 percent) of businesses had solid growth strategies, only 40 percent had access to the resources they needed to grow.

“The study shows private business owners feel they are being constrained by access to financial capital,” said survey author John Paglia. “Owners currently expect a 10 percent revenue growth over the next 12 months. If they were to receive additional capital, they estimate their revenue growth rate to jump to 25 percent.”

The survey by Paglia, a finance professor at Pepperdine University's Graziadio School of Business and Management, is unique because he interviewed alternative lenders, such as venture capitalists and private equity firms. Most surveys like this focus on one type of capital (such as banks or angel investors).

One worrisome finding: Despite their frustrations, most business owners are significantly more optimistic than actual conditions warrant, Paglia told the Los Angeles Times. This could prompt them to take unnecessary risks, and might mean that small businesses are in worse shape than previously thought.

Barbecue Guru Mike Mills Says it's All About the People You Hire

"I guess you could call me an accidental businessman," says Mike Mills, the 58-year-old owner of 17th Street Bar & Grill in Murphysboro, Illinois, known within barbecue circles as "The Legend." The transition from dental technician to a world-famous pitmaster with seven restaurant locations is not immediately obvious.

He learned the craft at his father's knee, cooking ribs low and slow into tender submission over open pits in the ground. "That was back before we had real smokers or grills," Mike recalls. "I've barbecued all my life. My motto was, 'Give me the meat, and I'll cook it.'" But he never intended it to become his profession.

Even when Mike bought his first restaurant in 1985, he "did it because the beer and booze business was good." Using a sauce recipe that's been in his family for more than 75 years, he "used to cook barbecue out in the back lot and give it away free just to get people to drink more." It wasn't until 1988, when his barbecue team started entering -- and winning -- the professional barbecue circuit that he realized that his barbecue might be something more than a simple thirst-inducer.

He retired the team in 1994 in order to focus on the restaurant, now named 17th Street Bar & Grill, with an intent to "serve more food than booze, which I liked a whole lot better -- mainly because I was getting older and couldn't drink like that any more."

Since then, the restaurant has grown into three more locations, though the expansion was anything but planned. "Someone said, 'I've got this place that maybe you could do something with,' and I said, 'I'm having fun with this one, why not try another?'"

A notorious workaholic, Mike jokes that at his age, he's "taken to only working half days," by which he means 12 hours. He divides his workday equally between overseeing his various kitchens; cooking ribs, pork shoulder, and brisket; and doing the necessary administrative work that comes with owning a restaurant chain.

"I'm a real hands-on type guy," Mike says in his characteristically down-to-earth manner. "What I've found is that whether it's with barbecue or running a restaurant, anytime anybody's tried to show me a shortcut -- an easy way out -- it's never worked for me. I've tried all the shortcuts there are, but there's no substitute for hard work"

All this is not to say that there haven't been snags along the way -- most notably a misstep in branding when Mike opened his first Las Vegas outpost, giving it the clumsy handle of Memphis Championship Barbecue despite the fact that it was serving the same food as his original 17th Street Bar & Grill in Chicago. "I was naïve in a lot of ways. I thought if you were gonna call a restaurant '17th Street,' then it's gotta be on 17th Street." The mistake has cost him, both in terms of the difficulty of marketing two separate brands both serving the same product, as well as in customer volume. "People go to Vegas knowing that I have restaurants there, but they look around and can't find a 17th Street Bar & Grill." They don't realize that Memphis Championship Barbecue is the same product under a different name, "so they don't come in."

In part because of this early mistake, Mike and his daughter Amy Mills Tunnicliffe -- now the marketing guru behind their mini-empire -- takes extra care in ensuring that all barbecue that gets served under his name is consistent, regardless of which of the four 17th Streets or three Memphis Championship Barbecue locations a customer dines at.

"Everything we do is tested," Mike says. The spices that go into his Magic Dust recipe are carefully inspected for potency and rejected if they don't make the cut. "I get my spices from a company in Arkansas that has a specific supply chain, so they secure their spices from the same growers all the time." Back when Mike first started, his spices were ground at the restaurant to ensure the right texture. "Most commercial spices are ground too coarse," he says. "They're gritty, and I don't like that. I grind them down to where they completely melt." These days, his volume is high enough that his suppliers in Arkansas do the milling for him.

Even with directly traceable sourcing, there are variances in raw ingredients that need addressing, particularly with meat. "Not all hogs are created equal." You can't simply put a pork shoulder in the smoker, "set a time, and expect it to come out the same every time." Instead, Mike relies on meat thermometers to tell him when his shoulders are done cooking. "I take temperatures of everything. I know that if my pork shoulder's not up to 193 degrees, it's not done, no matter how long it's been in the smoker."

With seven outposts of his two restaurants and a whole slew of barbecue-consulting gigs, maintaining consistency and quality from location to location is no small feat. In the end, it's not about Magic Dust or sauce or even how the ribs are cooked, Mike says. Keeping his multitude of locations in shape is "all about the people you hire. They have to have a desire to do better in life as strong as your own. They have to have that same basic need. I don't set 9-to-5 hours," he says. "All a schedule does is force someone to be somewhere they don't necessarily want to be. I tell my employees what I expect from them, and tell them to do whatever it takes to get the job done."

The management style seems to work, weeding out the ones who aren't in it for the long haul early. The ones who stick around "are the people that'll really make you successful, and I have the utmost respect for them. Everyone who works for me has the same basic needs as me: They want to get ahead, I want to get ahead, and they will help me live my dream while I help them reach theirs."

Top 5 Ways to Find Your Next Million-Dollar Idea

Have you ever noticed how some of your best business ideas come when you’re traveling? While you’re no longer going through the motions in the well-worn grooves of your old habits, all five of your senses can be engaged in absorbing the different ways things get done.

I have found traveling to new places (the farther the better) and actively observing local business models to be the best source of new business ideas. Spending the month of July in France and England inspired this list of the Top 5 Ways to Find Your Next Million-Dollar Idea:

On the outskirts of Aix-en-Provence, I visited a sports superstore that was a combination of an REI, Dick’s and the best specialty bike shop I have ever seen. There were tennis ball machines ready to launch balls on a mini-court for customers testing different rackets, camping gear set up so the kids could scurry into all different sizes of tents, a practice driving range to help golfers choose their new clubs, and a mini soccer pitch complete with practice nets.

In North America, we see the same retail concept for sports stuff again and again: you buy your camping gear at REI and your new Trek from your local specialty bike shop. Visiting Decathlon in France made me realize, however, that there might be a market for a sports superstore in North America. It also made me think about other retail categories ripe for a mash-up…

Nobody in southern France goes to Starbucks. Given my raging coffee addiction, this immediately seemed problematic. The house we rented didn’t even have a drip coffeemaker. All it had was a Tassimo single-serve espresso maker. Any port in a storm, I thought and bought a package of Tassimo cartridges. I quickly became reliant on the Tassimo coffee. Each week, I bought a new 24-pack of coffee cartridges, and now I have swapped one addiction for another.

In North America, Starbucks is so ubiquitous, it’s hard to imagine getting espresso anywhere else. The Tassimo cartridges made me think about other consumable business models—razor blades, gas, toner cartridges—that may be ready for a shake-up.

My hotel in England had a mobile phone charging stand. Regardless of your phone model, you could insert ₤1 into the machine and get a few minutes of juice. While I have seen these stands in some North American airports, I had never seen them in a hotel, but this seems an ideal place to make them available.

I needed a “big” car there to lug a family of four (and all of the gear I would end up buying at Decathlon), so I got an Audi A3 Sportback. While most North Americans would think of the A3 as a small car, Europeans consider it a large family car. It has a small but capable 1.6 liter turbo diesel motor that got me 1,000 kilometers (about 620 miles) per tank.

Instead of using air-conditioning, the homes in Provence are equipped with heavy shutters over the windows and doors, which owners close at sun-up and open at sundown. Protecting the glass from the sun keeps the house cool. Although the daytime temperature reached 90-plus degrees throughout July, thanks to the shutters, our house remained comfortable for sleeping.

In North America, I take energy gels—single-serve packets of sugary syrup—when I go for a long run. They keep my legs moving but can play havoc on my stomach, so I often can get only half a gel down. But once I open a Powershot, there is no way to reseal it, so half is wasted. In Europe, I found energy gels packaged with a resealable top.

On your next vacation, keep your eyes peeled for the way the locals do things. Their different approaches to everyday life may just give you an idea you can bring home—and take to the bank.

I Miss My iPad

Here's what's cool about the iPad: they're great devices to consume and do some basic communications work. You can tune into webinars on GoToMeeting, or you can answer some email. You can stay up to speed on RSS-driven news (including your company news, if you've built RSS feeds as a delivery mechanism), and there are some really clever apps, like Square for payment processing (that I mentioned before).

But beyond that, they're not workhorses, and some basic business chores (like spreadsheet stuff) are really frustrating to do on an iPad. For instance, if you're going to have to input a bunch of things, like listings of homes for a real estate company, or updates to inventory for a store, it's just not an easy tool to use. Even if you buy a Bluetooth keyboard or a docking keyboard, you suddenly find yourself stuck with almost-a-laptop. Oh, and you can't multi-task.

I bought an iPad the first week, because I believe there's some business magic in this old silk hat. But as an owner of an iPad, it's not yet really kicking butt as a business tool. Mind you, my business relies heavily on content creation (like writing this blog), and so maybe I'm not the norm, but I'm not seeing many people MAKE anything on their iPads. I'm seeing them consume.

The iPad is the single best device for electronic learning that I've ever owned. I use it for digital books like iBooks and Kindle books, and I've completed four rather lengthy books on it so far. I use it for consuming audio and video podcasts. I use it for watching documentaries and other movies. It truly is an amazing device for consuming media of different kinds.

Don't ask me whether I regret buying it. I don't. I think there will be some improvements and innovations that come with it. I also think that some businesses will benefit from buying iPads instead of laptops, should their function be mostly for consuming and communication. But in the shorter term? Save your pennies.

5 Ways to Make the Collections Process Easier

Collections are a fact of life when you run your own business. Sooner or later, something will happen that will put you in a position where you have to get a customer to cover an unpaid bill. Even if you don't extend credit to your clients, there may be a bounced check or other situation that requires you to go to lengths to get your payment. It isn't possible to eliminate the collections process, but you can make it easier.

Melissa Brumback handles collections for her firm and also provides help for clients collecting on unpaid accounts. Her experiences have led her to recommend making your first contact with a new customer with the collections process in mind. "Be careful on the front side in who you extend credit to," Brumback suggests. "Get a personal guarantee if possible. Make a copy of the person's driver's license. (This helps if you have to sue to collect). Check their credit."

Anything you can do to make the collections process easier (whether or not it turns out to be necessary) is useful. Brumback goes on to point out that having a written contract will help if you ever need to escalate the collections process. "Have a written contract if possible. Failing that, a signed purchase order agreement, with contract terms on the back, would be good. You can include language for interest (up to 18 percent per annum) and reasonable attorney fees and collection costs. If you don't have this in writing, you may not be able to get these items later."

Even if you don't wind up in a position where the collections process is necessary, having a system is crucial. A system speeds up your ability to respond — you aren't standing around, trying to decide what to do next — as well as provides a way to make sure that you take care of every step needed in a worst case scenario, such as taking the matter to court. The first step to a good collections system is having a reliable bookkeeping system. If your invoices don't go out on a regular basis, a past due account may be more a matter of the client not realizing that there was an invoice than choosing to ignore it.

Your collections system should include a time line, according to Brumback: "When an account is X days late, send a polite but firm demand letter. When an account is Y days late, initiate a lawsuit or have your attorney send a demand letter, etc." Brumback also points out that it's important to consider your local requirements for actions such as filing a lien. "If you are in the position to file a mechanic's lien (contractor, subcontractor, etc), be aware of time deadlines for both filing a lien and perfecting that lien. These are state-dependent, so consult an attorney in your state."

In a collections situation, there's a tendency to see a client who hasn't paid as the bad guy. It's completely understandable, but an approach based on that viewpoint is almost certainly going to put a client off. After all, no one wants to feel like they've done wrong, no matter the actual circumstances. Finding an approach that takes the client into consideration is crucial.

Barry Maher may now be a motivational speaker and consultant, but he made his mark as a salesman and sales manager. Maher says, "For me, the key to dealing with customers who are behind on their payments is to treat them as valued customers. To avoid embarrassing them, we start out by 'just touching base' to see if the payment fell between the cracks or there was some oversight. Then we show understanding, allowing them to save as much face as possible and, at all costs, avoid getting their back up, so they become defensive and look for reasons why they shouldn't have had to pay in the first place."

Collections can be particularly wearing because it can feel like you've been trying to get the same client to pay for months — and in particularly bad situations, that time line may not be far off. By the end of the process, you're often willing to accept less than you actually deserve, just to get the whole mess over and done with. Getting an account paid quickly is just as much a priority as getting it paid in full. Look for practical solutions: alternative payment arrangements can offer an opportunity to resolve the matter, albeit not as well as if the customer in question had just paid on time.

But with payment plans and similar arrangements, it's especially important to be sure that a client can't miss a payment and start the whole problem over again. Brumback suggests getting the whole situation in writing and even taking it a step beyond a simple contract. "If your customer acknowledges the debt, and is willing to sign a note or confession of judgment, you can offer payment terms. If the payment terms are not met, then you can file the note and judgment." Such a note lets you go straight to court if a payment arrangement falls through.

The hardest part of the collections process is recognizing when there simply isn't a way left to get a customer to pay an account in full. Whether you're dealing with a customer who has declared bankruptcy or simply disappeared, there is a point where it's simply a matter of giving up — rather than using your time to chase after an unpaid account, using that time to find new customers is just more practical.

You don't want to give up too easily, of course. But if you take a good, hard look at how likely your business is to receive payment and it seems to be close to impossible, it's time to consider settling for less or even walking away.

7 Tips for Raising Venture Capital

I was fortunate enough to raise a modest amount of venture financing last year. Even though I had a bit of an edge because one of my employees was formerly a venture capitalist, it was still a challenging process.

Here are seven tips from what I learned:

Venture capitalists will pick apart your projections, operations and vision. You probably already have a great instinctive feel for your business. But the challenge when dealing with VCs is being able to succinctly articulate this. Keep in mind that VCs are financiers, so the ability to talk about your operations, growth, etc using numbers is critical to impressing venture professionals.

It seemed to me that VCs became most interested once my business has started to “prove” that there was a market for our service. The venture capitalists I spoke with talked about looking for companies where the capital would change the trajectory of the business.

3.   Prepare for a long slog.
Raising venture financing is like taking an additional job. The amount of effort and time required was amazing. I recommend treating the process in the same way you approach making sales. We kept very careful records of who we were speaking with, when and the right follow-up items. Since so many of the meetings are similar, with a similar set of questions, having one place where you keep all information is important!

4.  Approach VCs the right way.
Venture investors are looking for great teams. One way to prove to the VC that you are a top notch entrepreneur is to get introduced to them by people the VCs trust. Venture capitalists will be much more interested in your business if they are introduced to them by someone they know. The best warm introductions are from successful entrepreneurs/executives.

5. Practice your pitch.
We had a 15 page PowerPoint presentation that we used to pitch VCs. By the end of the process I had cut it down to 12 pages and could deliver it in about 15 minutes. Since most investors give you between 30 minutes and an hour for your first meeting you need to be very concise in delivering your message.

6.  Have diligence materials ready.
We put together projections, operational stats and related legal files (as recommended by our lawyer) in one place online so that we could share it with interested investors right away. We worked hard to keep momentum going when investors showed interest.

7. Hire a good lawyer.
Venture terms are constantly changing. VCs negotiate investment terms constantly; most entrepreneurs only do this once or twice in their careers. Without the help of an experienced venture lawyer I don’t know how we would have gotten such a good deal.

Raising venture capital is a difficult process, but it can really help grow a business. Preparation is key to succeeding at the venture capital game!

Finding Money Online

If you’re like most small business owners, when it comes to raising money for your company, you need all the help you can get. For that reason, you might consider checking out some websites aimed at making it easier to find investors or get a loan.

Of course, these sites usually aren’t substitutes for good, old-fashioned relationship building. “Consistent personal communication builds trust and better working relationships,” says David Worrell, a corporate finance consultant who advises small businesses about how to secure capital. Plus, you have to be careful. Not all funding websites are legit.

Still, there are a number of worthwhile sites worth investigating. Here’s a look at four:

This site provides an alternative to a traditional bank loan. Using proprietary software, On Deck makes the decision whether or not to lend based on an analysis of cash flow and a host of other information not usually employed by bankers. Loans, which are usually are on the order of $30,000 or so, are repaid through daily deductions from the borrower’s bank account. And the decision on whether or not to lend is made in a matter of days. Interest rates aren’t cheap—they range from 18 percent to 36 percent - -but they’re lower than what you’ll find at, say, factors, which charge rates as high as 200 percent.

Also, because On Deck gathers and validates so much data electronically, they can analyze your situation and offer what amounts to technical advice on such issues as cash flow controls. Since starting to make loans in 2007, On Deck has lent over $80 million to nearly 3,000 small businesses, which generally have revenues from $300,000 to $3 million.

It’s aimed at entrepreneurs seeking venture capital funding. You have to be a CEO or company founder to become a member; it takes about 24 hours to approve your membership after you fill out a simple online application. After that, you can search the site for information about venture capital firms using such filters as geography. “Most VC funds invest within a confined region,” says founder Adeo Ressi, founder of theFunded.

Then you can review the data on each fund in detail. That should include contact information for all partners, as well as reviews and ratings by other members about both funds and partners. You’ll also see in-depth discussions of just what it was like to work with each fund. Plus, there’s a showcase area, where you can post information about your company and other members can help introduce you to partners at specific firms you’re interested in. The service is free for company founders.

Lenders make their decisions based on a variety of traditional and less-than-traditional data, ranging from your credit score to your budget or a description of your business model. And you can invite suppliers, customers and friends to comment. About 85% of applicants with good credit scores get all the money they ask for, according to Chris Larsen, CEO. Just one caveat: Prosper operates in just 28 states.

17 Signs that You Are a Great Boss

We all like to think that we are good people to work for (well, most of us do), but is it true? I have been hearing from a lot of people about bad bosses lately – maybe it’s the economy – and one thing I noticed is that few bad bosses actually see themselves that way.

1. You don’t micromanage: There are few things more frustrating than the boss who not only is not happy with your work, but tells you how to do it to boot! Great bosses trust that the people they hire are smart enough to do their job, even if you might do it differently.

2. You know how to have fun: People work for all sorts of reasons, pay is just one. We work to learn new things, meet people, sharpen skills, get ahead, and yes, socialize and try to have a good time. The best bosses temper work with fun, knowing that the latter reinforces the former.

3. You push, but know when to back off: Employees usually want to be challenged to do their best, and if they like where they work, they will strive to give that. Great bosses are like great coaches – they know when to push and when to back off so as to draw out the best from their team.

4. You have good manners: Some of the items on this list are intuitive, others less so. Saying “please” and “thank you” may seem like a little thing but in actuality, it’s not. The boss who does not say please or thank you usually makes people feel crummy. Having some manners shows respect and garners respect.

5. You treat employees like adults: Good bosses know, for instance, that if Megan says she needs to come in at noon on Thursday, she probably has a good reason. The best bosses treat employees like adults and expect that they will act that way. This too fosters mutual respect.

6. You are fair: The hallmark of the bad boss is unfairness. He or she plays favorites, has strange priorities, and makes life difficult. The opposite is also true. The great boss treats people equally to the extent possible and make sure that the workplace makes sense.

7. You also make exceptions: Yes, fairness is important, but not everything and everyone is always equal; just like you have to respect the differences in your children, so too do you need to do so in your staff. For instance, one month, Phil may need to get all of the extra overtime hours due to his financial situation. Making exceptions, when appropriate, is usually the humane thing to do.

8. You reward good, hard work: Rewards can come in all sorts of forms. Monetary is best of course, but recognition for a job well done can sometimes be equally effective.

9. You create a team: Great businesses are ones where people get behind a goal and pursue it in unity. That requires a boss who can motivate the team, sell them on the goal, and lead them in that direction. Which also requires that…

10. You lead: You are not in business to be your employee’s best friend; instead, you are in business to create a business and make a profit. That requires that you have a vision for your business , sell people on that vision, and then lead them down the field in that direction.

11. You teach, and learn: The great bosses teach skills, business acumen, and sometimes, life lessons. They help employees get to the next level in their development. And by the same token, a really good boss knows what he does not know and is willing to learn some new tricks.

12. You listen: Bad bosses rarely listen. Good bosses always do. You may not agree with what you hear (and then again you might) but your people know that you are fair and are willing to hear out a different point of view.

13. You don’t engage in petty office politics: Good bosses don’t gossip (mostly!) They do not pit one person against another. They do not take credit for someone else’s work. They don’t feel threatened when someone makes a good suggestion.

14. You make people feel valued: Bad workplaces are typically apathetic places because the employees fell disconnected because they think that what they do and think does not really matter. In contrast, the great boss engages people so that they feel empowered, respected, and valued.

15. You set realistic, achievable goals: People who work for you know what is expected of them, period.

16. You criticize, and compliment too: A really good boss knows that both compliments and criticism are needed to keep the ship afloat and that too much of one or the other can throw things off-kilter.

17. You inspire: My best boss ever helped me realize, to quote the great Nathan Lane in The Producers, “There is more to you than there is to you!” The best bosses help people help themselves.

Social Media Moms Partner with Brands for Summer Promotions

The number of moms using social media has taken off. A study by BabyCenter said "Since 2006, the number of moms using social media has skyrocketed more than 500 percent.” It’s been so popular that it’s drawn scrutiny from the FDA (you must disclose when you get free product or accept paid reviews). Moms have been called out for possibly ignoring their kids in this article from the New York Times.

I attended a conference called EVO recently, organized by Jyl Pattee of MomItForward and Rachel Herrsher of Today’s Mama. There were about 300 social media moms there—moms who have followings on Twitter, Facebook and their blogs. The swag is often sweet—and flowing—at these conferences.

I’m not talking pens and keychains with logos either. Pepperidge Farms was there with a new flavor of Vanilla GoldFish. Quaker Oatmeal sponsored breakfast. Mrs. Fields covered a snack at a break with cookies and milk (the packages touted their blog). Brands are hoping to reach new audiences online through working with power moms. One way they do that is through sponsoring Twitter parties.

A Twitter party is a group discussion on Twitter, with a twist. They are sponsored and have their own hashtag. They’re the rage right now. Some of the brands who’ve sponsored Pattee’s Twitter party #gno (Girls’ Night Out) include Lawry’s, Boca Burgers, and Royal Caribbean.

Here are a few of the partnerships between brands and moms I’ve seen this summer:

Midas Rock the Highway Campaign
I have a fondness for the roadtrip campaigns like the one Midas sponsored called Rock the Highway. Company experts and moms exchanged traded roadtrip tips and stories on a Twitter chat. Participants entered to win by actively participating (leaving a comment, becoming a fan, retweeting about the event, sharing roadtrip experiences during the chat, etc).

1-800-FLOWERS Summer of Smiles
1-800-FLOWERS just wrapped up the Summer of Smiles campaign. They let bloggers choose someone they want to send flowers to and 1-800-FLOWERS delivered them. The blogger then blogged, Facebooked, and/or tweeted about the experience. I couldn’t reach 1-800-FLOWERS for more details, but from what I saw on a few blogs, there were many ways to enter:

Popsicle Moms
Popsicles, kids and moms go together in the summer, and this is another example of a sweet partnership. The Popsicle brand has been doing giveaways and is using social media and blogs in their campaigns. They’ve given away coupons and sent samples. The Mom Bloggers club, a community that connects mom bloggers and brands, helped Popsicle connect with 11 women called “Popsicle Moms” (or brand ambassadors).

As Popsicle is getting moms to spread the word, the brand is also tapping into cause marketing. They teamed up with National Geographic to raise funds for research into global climate change, so working with Popsicle helps support their cause.

Thinking of working with social media moms? Here are eight things you can learn from these campaigns:

1. Be creative. There are many ways to promote your products online. Though it has its own culture and norms to navigate, you don’t have to be a big brand to do this type of PR.

2. Name your campaign and give moms bragging rights for being a part the club (i.e. a name like Walmart Moms, Disney Social Media Moms, and a badge to go with it.)

3. Look for possible partnerships with local bloggers or others active on social media sites where there’s a good fit with your brand or style. Make sure both sides benefit.

4. You could sponsor a Twitter chat where you share expertise and get visibility with mom bloggers.

6. Hold contests and reward people for taking specific action to spread the word.

7. Tie your promotions into a good cause. It doesn’t have to be global—it could even be working with Make A Wish Foundation to help a local child fulfill their wish.

One thing about social media moms is they are opinionated (why else would we tweet, blog and Facebook our lives?) Ask for their input about your campaign and how they might work with you. If you’re not savvy online, you might want to work with an agency or PR firm with experience in working with social media moms to coordinate the effort.

Now for your input. Have you worked with social media moms—and if so, how did it go and what did you learn from the experience?

6 Tips for Planning a Corporate Retreat on a Budget

Team bonding via private jet to Lake Tahoe is the kind of corporate spending you just don’t see anymore. That’s a good thing when it comes to long-term job stability -- but those were good times, no?

Well, here’s some good news for management: there are still plenty of ways to say "thank you" and "lets keep working together" to your staff and clients without blowing through next year’s budget. Corporate retreats are a special way to generate good will and unity amongst staff and management. Yet, if there’s nothing else the recession taught us, it’s that it’s important to be prudent. An office getaway does not have to max out your budget.

In fact, these office getaways are an opportunity for management and executives to learn leadership skills while exercising some renewed creativity in a way more relaxed environment. The corporate retreat isn't a paid vacation. (Would you really choose to travel with all your colleagues for fun?) It’s more a breath of fresh air -- literally -- and a reprieve from the post-traumatic horrors of being over-worked and way stressed out.

A small business with a small budget can benefit from corporate retreats as much as a huge corporation with lots of money. In fact, with most large companies nixing their retreats because of budgetary concerns, many destinations are vacant and hungry for business. So look for discounts!

There’s no need to fly your staff across the country when there are great locations merely a drive away. Take advantage of destinations in your backyard or in regions of the country that aren’t as costly, and are in need of tourism and business travel dollars.

Most states have an array of activities. Look into the great lake and Rockies areas, or, southwest through the Midwest -- and don’t forget the New England coasts and the Appalachia region. Focusing on high-end retreat hotspots in California, Florida and Colorado isn’t cost-effective, and they can be limiting when fully-booked. Renting a van or bus, however, is mandatory. Packing everyone into cars for a three-hour drive is bound to be an episode of The Office -- only those in the car won’t be laughing hysterically.

Remote locations and retreats with a small business mentality versus those that are part of a corporate franchise frequently provide five-star accommodations at a lesser cost. Sometimes they even throw in accoutrements like fine local wines and thoughtful spa services.

Golf retreats are expensive, but canoeing, kayaking, fly fishing, mountain biking, rock climbing and the like can be less expensive, invoke more team-building, and are less likely to get so competitive that someone has a meltdown and ruins it for everyone. Leave the golfing and skiing retreats to the Fortune 100 executives.

With big corporations sitting out on the big spending, there are a lot of places with empty facilities. The owners of these spots want your business, and want to attract more business to their towns, so when negotiating a good deal, throw in a barter of services. Offer to include the retreat information in your company’s newsletter or pass the word on to clients about what a productive, creative and relaxing experience it was (if it was).

Although you may be out in the boondocks, you’re going to need meeting rooms and the necessary infrastructure to get some work done. While you’ll need places to set up your computers and working Wi-Fi for sending emails, be prepared for what retreat centers won’t have. You probably won’t find office luxuries, like the tech gadgetry for Power Point slideshows and hi-res color digital printing, so be prepared.

These Issues Need to be Resolved Before Cloud Computing Becomes Ubiquitous

Many independent entrepreneurial businesses are already using cloud computing apps (online Web-based software applications) to run their businesses. And if you’re not already trying out cloud apps, by 2020 many among us expect them to almost replace local apps residing on your own computers, according to the fourth "Future of the Internet" survey by the Pew Research Center and Elon University.

That’s an interesting prediction about cloud computing, and one I happen to agree with. But we have a long ways to go before we get there. There’s still a wide gap between that future vision, and reality of today. Specifically, I see three issues that have to be resolved.

According to the Pew survey, the year 2020 is the date that the majority of tech experts and general public say cloud computing will almost replace desktop computing (apps loaded on your local computers).

Seventy two percent of experts and 71 percent of the general public agreed in the Pew survey that in 2020 “most people won't work from a PC running software, but from Internet- and smartphone-based applications.” Another 25 percent of experts and 27 percent of the general public agreed that “most people will still work from a PC running software, with Internet- and smartphone-based applications having some functionality.”

Yet, in my view there are still three key issues to overcome before cloud apps become nearly ubiquitous in small businesses. The study also noted similar issues to those I see:

- Mobile apps have terrible interfaces for mission critical business apps -- It’s all well and good to talk about accessing online apps with mobile devices. However, most hand-held devices such as smartphones or even the iPad, don’t yet have user interfaces that make it easy to do heavy-duty work on them. Today’s mobile devices are much more suited for Web surfing and light messaging. Ergonomically and physically, it’s hard to spend hours of intensive in-depth work on mission critical business apps using even a small netbook-type laptop, let alone smaller handheld devices. Somehow, the user interface issue needs to be resolved if we’re truly going to be “mobile.”

- Security and privacy of data are still wild card issues -- These days small businesses are more comfortable with their data being accessible on the Web, than they were a decade ago when I first proposed an application that put customer data online in the company I worked in. Back then, business owners were horrified with the idea of their data residing anywhere but on their own computers. Today, there is more comfort with data in the cloud; however, concern has not disappeared. Every security breach that gets reported in the news, has the potential to lessen business owners’ confidence in Web apps. Application providers will have to maintain the highest levels of vigilance over security and privacy issues.

- Customer service for Web apps leaves a lot to be desired -- All too many cloud-based apps make it difficult to get customer service promptly – or at all. Sending an email and hoping for a response within 48 hours is NOT an acceptable way for most of us to run a business. Nor is being directed to an online forum manned by volunteers, where you may or may not get reliable answers. We might put up with this for apps that aren’t central to running the business. But for mission-critical business applications such arrogant “customer service” is just not acceptable.