madisonSBS

How to avoid 5 common small business blunders

lboissiere — Mon, 02 Nov 2009 05:05:28 +0000

In the course of working with small business owners, I’ve witnessed many businesses stumble making similar mistakes. This post was written to help you avoid five common small business blunders.

Make sure that you’ve started your business for the right reason: To make money. If your business cannot sustain itself and generate positive cashflow, there are probably more prosperous ways that you can spend your time. Too often I hear small business owners choose self-employment as a way to “give back”, to “work for themselves” or to have “more flexibility and control”. While there is truth and merit to each rationale, there’s also a bit of fallacy. So let’s tackle them one by one. Number 1: You can’t “give back” until you’ve earned enough to have something to give. Number 2: As a small business owner, you do not work for yourself. You work for every customer and client that you serve. And Number 3: While it’s true that being self-employed gives you more flexibility and control, you will work harder — and likely longer hours — than if you were employed. Consequently, I believe the only reason to be in business is to make money.

Run your business by the numbers. Depending on the type of business you run, you should be intimately familiar with sales and profitability by product, customer or project. Remember: Margins matter. Dropping price to close the deal is the classic sales tactic. But when you’re burning through your own capital, lower margins translate into higher cash burn. That is, you will need to eat into more of your savings (or investment capital) to keep the business afloat. And margins should include the cost of any required financing. If your contracts require financing to execute (i.e., equipment financing, working capital, bonding, etc), the cost of the financing should be included when determining the project’s profitability.

Exercise laser focus. Avoid the tendency to chase whatever business comes your way. Focus. Pick a “widget”, a vertical, a service offering, a specialization, a type of flooring (e.g., hardwood), a government agency, a type of construction (e.g., office space) and hammer at it until you’ve conquered it. Only when you’ve profitably conquered that business — or determined that the business isn’t profitable — should you turn your attention to the next “widget”.

Sell or service, but not both. While it’s true that small business owners wear many hats, it’s important to know which hats to hand off. You can be the head of sales, or the head of operations, but doing both will grind you — and your business — to a halt. It’s critical to separate sales from operations as early as possible. If you’re chasing sales, then servicing those sales, your business cannot grow. You will find yourself stuck in a continuous “feast or famine” cycle. Know when to hire a project manager, a junior consultant, an installer, an operations manager. Having someone to whom you can reliably hand off business once you’ve closed the deal is critical to growing your business.

Business is business. Don’t take it personally. There’s little or no room for emotion in business transactions. This is particularly true for small business owners. Always use objective data to make informed decisions. If you choose to act on emotion, principle or sheer gut, make it a conscious choice. Be clear about what decision you’re making, why you’re making it, and the long- and short-term consequences of your choice. Closing your line of credit because the bank won’t increase the line in spite of your impeccable payment history may “show them”, but ultimately you will pay the price if you need the working capital to run your business.

Demystifying Social Business Strategy

lboissiere — Mon, 14 Sep 2009 17:55:41 +0000

Social media. Social marketing. Social networking. Social business strategy. We hear the buzz words and often wonder what does it all mean? I sometimes wonder if anyone knows.

What we do know is that there’s an emerging group of technologies which can drive business — via marketing, branding, lead generation, etc. Everyone is looking for the “silver bullet” of how to incorporate the use of emerging technologies in their business strategy. In his blog Decoding Social Media Strategy and Social Marketing, Guarav Mishva, CEO of social media research and strategy company 20:20 Social, does an excellent job of breaking the buzzwords down into a language that is easily understood.

Let’s once and for all take the veil off this mystery called Social Business Strategy.

6 Steps For Link Building And Driving Traffic With Social Media

lboissiere — Thu, 10 Sep 2009 13:36:36 +0000

Everyone knows that link building is important for organic ranking in the search engines. As Social Media has evolved rapidly over the last two years, I’m now asking myself: Can Social Media be leveraged to increase my website’s authority? Essentially, this is three questions…
6 Steps For Link Building And Driving Traffic With Social Media

Why EDs and Entrepreneurs?

lboissiere — Thu, 03 Sep 2009 14:27:24 +0000

Passion. Vision. Commitment.

Executive Directors and Entrepreneurs share three powerful characteristic:

Passion for the work that they do.

Vision to see possibilities.

And a Commitment to the hard work required to accomplish their vision.

Moreover, many small businesses and non-profits share two common challenges: they accomplish visionary results although often under-funded and hence under-staffed.

In my years of working in both corporate and entrepreneurial enviroments, I’ve been inspired by many EDs and Entrepreneurs. And I find working with non-profits and small business owners to be incredibly rewarding.

I founded madisonSBS to capitalize on those experiences and to make a difference by serving this important market. The Passion, Vision and Commitment common in EDs and Entrepreneurs is what drives our commitment to service.