Use Your Leadership Style to Make Your Best Business Plan Yet (Entrepreneur.com)

Use Your Leadership Style to Make Your Best Business Plan Yet

Find out what kind of a thinker--and business owner--you are by asking these strategic questions.

By Tim Berry | July 24, 2008

URL: http://www.entrepreneur.com/startingabusiness/businessplans/businessplancoachtimberry/article195854.html

Funny, isn't it, how just getting started is often the hardest part? I think that's true of business planning. Avoid the inertia. Get started, get going and don't wait.

How do you get started? It's important to realize there are many different ways, and the best choice for you depends on the way you like to work.

In Start with the Review Schedule, my March 2008 column, I suggest that you start by setting the review schedule. That's still one of my favorite starting points, because it sends a clear message about what the planning is about and how it'll help your business.

However, maybe you're a concept person, a strategic thinker. That's great. Stick with that, and start your planning with what I call the heart of the plan, the core strategy. Take a step back from your business and ask yourself four key strategic questions:

1. What am I really selling?
   Ask yourself why people buy your product, what they're getting from your business that they can't get elsewhere, and what wants and needs drive their decision to buy your product.
2. How do I want my customers to think of my business?
   Ideally, what words or phrases would they use to describe your business to a friend? Are you reasonably differentiated? What's the key message customers should be getting?
3. What am I really good at? What do I (my company) do better than anybody else? Am I correctly focused on that core competence?
4. What do my customers want that I'm not giving them?

But perhaps you're more comfortable with numbers than concepts. That's not a problem; no apologies necessary. In that case, consider these three tips:

1. Do a sales forecast. Break your sales into components, such as specific products, groups of products, channels or buyers. Project it if possible into units, price per unit and cost per unit (not always possible, but a good idea when you can do it). You'll discover that as you project your estimated sales, you're thinking about some of the core strategy questions above, which will be implicit in your numbers. And once you have a sales forecast, you can start tracking results, which leads to your planning process.
   
2. If you're a startup company, estimate startup costs. That includes expenses that occur before your first day of business, such as legal expenses, fixing up a location, developing prototypes; and the assets you'll need to start, such as equipment, starting inventory, and--oh, yes--cash in the bank.
   
3. Estimate your expense budget. If you like, call it a burn rate. What do you think you'll be spending for rent, payroll, utilities, marketing expenses and everything else? As with the sales forecast, this gives you something to track, so you can start planning.

Alternatively, perhaps you like to-do lists better than numbers or concepts. In that case, start your plan with milestones: dates, deadlines, business activities, how much they're going to cost, how much they're going to produce. These are concrete specifics.

The key here is to get started and get going. People are different, so start anywhere you like; it won't matter. You'll fill in the rest when it's needed. This way you'll be able to see results quickly, and that will help you stay motivated as you do your planning.

Tim Berry is the "Business Plans" coach at Entrepreneur.com and is president of Palo Alto Software Inc., which produces the industry's leading business planning software, Business Plan Pro, as well as other popular planning applications for businesses.

For Real Planning, Start With the Review Schedule (Entrepreneur.com)

For Real Planning, Start With the Review Schedule

Stop letting all your management plans slip through your fingers with efficient meetings that track progress.

By Tim Berry | March 13, 2008

URL: http://www.entrepreneur.com/startingabusiness/businessplans/businessplancoachtimberry/article191304.html

My favorite suggestion for your business plan this month is that you go--right now--into your plan and set up its review schedule.

That's right--I hope it surprises you. Why worry about the subtleties of an executive summary, language or a market analysis if you don't have the most important element for actually using and working a plan?

Planning isn't complete unless you've planned for review. People in management should know that initiating any plan is only one part of managing that plan. Much like steering a car, you also need to make necessary course corrections every now and then without losing track of the long-term goals. Without plan reviewing, your business is like a car with a locked steering wheel.

To establish consistent review meetings, schedule a particular day for it, like the third Friday of every month. Make sure the main people involved are invited to those review meetings.

When you set the schedule in advance, it is harder for key team members to come up with reasons not to be there. Sure, occasionally there is some command performance that can't be helped, necessary business travel, people sick, or whatever; but having the dates ahead of time makes the plan review more likely to happen.

And if you're running your business alone, or there's just two or three of you, it's still a good idea to set the review schedule. People need reminders. It'll also help you to remember review key points, your main assumptions, and where you want to go with your plan. We all forget sometimes, so we need a reminder to take a step back, and look at the larger picture.

Here are some tips for making your plan review as useful as possible:

• Start your review meetings by discussing key assumptions. This is why it's so important to list those assumptions so they're fresh in your mind.

• Keeping changes in strategy and changes in assumptions related to one another.

• Keep review meetings as short as possible. One of the biggest threats to an effective planning process is spending too much time in meetings discussing the same things.

• Emphasize metrics. How do actual metrics compare to plan metrics? Discuss variances, the differences between the planned and the actual numbers. The obvious metrics are the financial results, but don't let those be the only metrics.

• Be aware of the "crystal ball and chain" phenomenon. Don't let planning become a no-win game in which people commit to future metrics that come back to bite them. Make sure planning is collaborative, so that it's always understood that change can happen and when managed, is good. Planning helps us manage change; it doesn't keep track of how bad we are at predicting the future.

Even though it may feel unnatural, the plan-as-you-go technique I described in last month's column will soon become second nature. Sometimes people don't want to record their plans for their peers. Setting the review schedule in advance sends the message that this plan will be tracked, reviewed and managed, which makes it that much more important to every employee involved.

Tim Berry is the "Business Plans" coach at Entrepreneur.com and is president of Palo Alto Software Inc., which produces the industry's leading business planning software, Business Plan Pro, as well as other popular planning applications for businesses.

High Gas Prices Hurting Small Businesses (NYT)

High Gas Prices Hurting Small Businesses

By MICKEY MEECE

It has been a bruiser of a summer for small businesses that must be on the road every day.

Gasoline prices may have moderated a bit lately, but business owners are still smarting from the run-up in prices this year.

John Nicholson, owner of Company Flowers & Gifts Too in Arlington, Va., was on Capitol Hill this week to tell members of Congress how his business has had to absorb higher costs. “Higher gas for our van alone runs more than $12 per delivery,” he said, though he added that so far he has kept delivery charges at $9.50. “We don’t want to discourage our customers from sending flowers.”

Still, he added, “After awhile I guess we’ll have to raises prices.”

Plumbers, contractors, data couriers, florists, limousine companies and other small and midsize businesses that rely on driving to make money are adapting to a volatile landscape in different ways — whether through higher prices or creative, long-term fixes. Energy prices are still high enough, and the economy still slow enough, that the changes made in the last few months by those small and midsize businesses may well stick.

“As the economic outcome remains uncertain, small business owners are searching for innovative ways to reduce expenses and increase sales,” said Bruce D. Phillips, senior fellow at the National Federation of Independent Business Research Foundation.

In fact, the business owners say they are glad to make adjustments before the next problem arises. “You can only see into the future so much,” said David Rosenthal of Rosenthal Plumbing in Santa Cruz, Calif.

Every six months or so Mr. Rosenthal tries crystal-gazing when it comes to fuel prices. If he’s wrong about how much it will rise — as he was this time with his recently published pricing list — then his company has to offset the difference. “I don’t want to inflate prices to where it’s uncomfortable to our client base,” he said.

So Rosenthal Plumbing adopted global positioning system technology this summer to track its fleet of service trucks so it can deploy them more efficiently and increase the number of jobs technicians can handle in a day. It will soon install mobile navigation devices in each truck so that his employees can find the fastest routes to save on fuel costs.

The high gas prices this year cemented a decision by Sam’s Limousine and Transportation in Houston to head in a new direction. It decided to sell its last two limousines, which seat eight. Replacing them are other vehicles to transport passengers, including party buses, sport utility vehicles and Town Cars. The party buses seat 16 to 20 passengers and have, according to the company’s Web site, “soft, black leather couch seating, a mirrored stargazer ceiling, opera lighting, laser lighting, strobe lighting, DVD screens and a custom stereo and sound system.”

Ron Jones, vice president of the company, said it has recently seen “an increase in larger groups pitching in and going out together,” which makes the $130-an-hour rate affordable for a night out.

“This is something that’s been going on for a year now,” Mr. Jones said. “We have completely changed how we do business” to accommodate those groups by buying four buses this year.

What small business owners say they fear is that they will lose customers because of higher costs, putting even more pressure on their bottom line. In a recent survey by American Express, the percentage of business owners reporting that they have lost sales, like an inability to deliver an order, has doubled to 35 percent from 17 percent last fall.

The semiannual telephone survey of a representative sample of 621 owners this spring found that small business owners are being squeezed by higher energy and gasoline costs. A third said they had raised prices, up from 26 percent last fall.

RDS Delivery Service in New York, for instance, has raised prices this year. If not for diversification, it would be suffering the typical summer slowdown, plus the ill effects of rising fuel costs, which have hurt its small business customers.

Larry Zogby, its president, said the family-owned company added document storage and retrieval as well as critical parts and retrieval services to its courier businesses.

It also now allows customers to store goods in its warehouses and will pack orders and deliver them upon request. The idea is to build a “longer and deeper relationship” with customers, he said, and of course, not be completely reliant on its main business — messenger and courier services in the New York region.

This summer, he said, he has seen more than a few smaller customers go out of business. One owner told him, “If you’re flat, your ahead of the game.”

The National Federation of Independent Business Research Foundation, which surveys more than 3,500 owners via mail every four years about problems of greatest concern, reported in June that energy costs, excluding electricity, were the second most pressing concern after the cost of health insurance. Energy jumped two spots from the earlier survey.

The primary energy cost for 38 percent of the companies responding to the survey was operating vehicles. Most small businesses cannot afford to switch to more energy efficient vehicle, the authors pointed out.

“For four years, the economy provided a good, stable foundation for small business owners to do business,” said Mr. Phillips, author of the report with Holly Wade, a policy analyst. “But as it started to take a negative turn over the last several months, they felt the effects of rising costs of doing business as reflected by these results.”

Family-Owned Businesses (KQED)

Family-Owned Businesses (click here for show)

Many of the most successful global corporations started out as family businesses -- but from sibling rivalries to succession dispute issues, these companies face numerous challenges. We examine the trials, tribulations and joys of the family business.

Guests:

• Amelia Ceja, president of Ceja Vineyard, a Napa winery founded by the area's first generation of Mexican-American producers


• Kent Rhodes, visiting professor of leadership and ethics at Pepperdine University and an associate and consultant with the Family Business Consulting Group


• Lou Lucaccini, adjunct professor and research associate at the School of Business and Management's Family Business Center at the University of San Francisco


• Mary Everett, owner of the Everett and Jones Barbeque Restaurant, a family-run business with seven restaurants locally


• Maryles Casto, founder and CEO of Casto Travel, the largest privately-owned travel management company in Northern California and the largest travel agency in the Bay Area


• Steve Radford, senior vice president for Radford Surveys + Consulting

Reaching Beyond Borders (Entrepreneur.com)

Reaching Beyond Borders

With Web 2.0, opportunities abound for small businesses to target customers far and wide.

By Rachel Meranus | July 23, 2008

URL: http://www.entrepreneur.com/marketing/publicrelations/prcolumnist/article195848.html

The explosion of Web 2.0 has impacted the way people gather information and communicate. Large audiences around the world, as well as those with very specific interests, have equal access to information through social networks, virtual worlds and video sharing sites.

While some may find Web 2.0 fragmented, confusing and uncontrollable, the social nature of blogs and community websites offers the opportunity to communicate beyond one's target audience at a fraction of the time or cost of traditional techniques. Geographic and socioeconomic borders have little meaning online, allowing information to be targeted to an array of groups that may be interested in your company.

For small-business owners, this represents a potentially exciting opportunity to generate attention--and business--from customers who never would have had the chance to learn about your products or services.

Tips for Communicating Globally
Web 2.0 is about reaching a mass audience on an individual basis and encouraging an exchange of ideas that enflames interest and promotes passion. Blogs, social media sites and video sharing portals enable companies to connect more directly with their customer bases and create an organic flow of information where the consumer becomes an owner of your message. This leads the consumer to bring others to your message, triggering viral campaigns that build and multiply.

Global communications, however, involves more than just the widespread delivery of a message. To take advantage of the global interaction that Web 2.0 offers, communicators must learn to speak the language--both literally and figuratively--of more than their core audiences. Although the nature of social media requires companies to surrender some control of their messages, companies must still be disciplined in their approach and understand the nuances of communicating to audiences of varying languages, beliefs and motivations.

Careful research into target audiences--how they perceive your organization, its products, services, brands, as well as those of your competitors--is an important first step of any campaign but is even more critical as you broaden your reach and engage a wider array of groups. Before reaching out, monitor what's being said about your organization, as well as where those conversations are taking place.

Knowing your influencers--who they are, what motivates them, where they get their information, and whom they trust--enables you to optimize your messages by anticipating the topics that will stimulate discussion.

Social media allows spans cultural and language barriers if created and positioned correctly. But to be successful--and avoid embarrassment--companies should consider how the words and intentions of their messages will translate. What may be a catchy slogan in one country could be offensive in another.

While it may be unrealistic to envision all interpretations of one's message, failure to consider potentially inflammatory outcomes could have dire consequences. As effective as social media is at creating positive attention, unflattering information tends to spread twice as fast and twice as far.

For companies targeting specific countries or cultural groups, it’s also important to understand the subtleties of each country’s language and beliefs. For instance, in America the number 13 is considered unlucky. However, in Chinese, Korean, Vietnamese and Japanese cultures it’s the number four because when spoken aloud the word sounds similar to "death." As a result, many international companies avoid the number four in their product lines entirely.

As with language, knowing the holidays and observances of your target audiences can be crucial. Companies should be aware of the dates and traditions of significant holidays and, when appropriate, utilize the information to their advantage. Festive occasions offer an ideal time for building positive exposure, whether your company is celebrating the holiday or is an ocean away. Conversely, companies should refrain from language that references somber or deeply religious observances. A harmless reference in one person’s mind could be blasphemous in another’s.

Avoid times when large segments of a population will be unavailable or uninterested. For instance, if you want to make a splash in Western Europe, steer clear of August, when most people are on holiday. Similarly, if you’re looking to reach an audience in China, avoid the entire month surrounding the Chinese New Year (late January, early February).

Now it's time to get your message out. The press release remains one of the primary vehicles used to communicate messages to broader geographic audiences. Organizations that want to reach a number of worldwide audiences should take advantage of newswire international distribution and translation services to get the optimum global exposure. Also, companies can reach more markets by creating a multimedia news release enhanced with video, images and Web 2.0 tools, potentially increasing online visibility.

Harnessing the Power
Web 2.0 and social media are ever-evolving, and communicators who choose to leverage these tools have the opportunity--and sometimes the obligation--to direct their messages to a global audience. The internet is an open playing field. It has no borders, allowing information to flow freely from person to person, no matter where those two people reside or the different lifestyles they may lead.

Given this reality, companies must recognize that parties beyond their target audiences have immediate access to their story--for better or for worse. People who are miles apart geographically or financially are neighbors in the online world. As a result, companies want to broaden their reach using Web 2.0 must consider messages that will resonate with audiences beyond a company’s conventional borders and speak to audiences of varying ages, ethnicities and languages.

Rachel Meranus is Entrepreneur.com's PR Columnist and vice president, public relations at PR Newswire. Get more information about PR Newswire and public relations with their PR Toolkit for small businesses.

Create the Best Brochure

Use these tips for putting together a brochure that clearly gets your message across to potential customers.

By Melissa Crowe | May 25, 2007

URL: http://www.entrepreneur.com/marketing/marketingideas/article179020.html

As hard as you may try, you can only be in one place at a time. Your company brochure, however, can be in many places, helping you influence potential and existing customers. An effective brochure clearly and succinctly outlines what a company is about and what it has to offer. A poorly constructed brochure only confuses, frustrates and chases potential customers into the welcoming arms of the competition.

The following tips explain how to design a brochure that will properly represent your mission, outline what you have to offer your target audience and serve as an effective marketing and sales tool.

A good headline is key. The headline on the front of your brochure should always include the interests and perceived problems of your targeted audience, and be followed by the solutions you can provide. Many business owners mistakenly lead with their company's basic information. It's imperative, however, to capture your audience's attention and prompt them to read the rest of the brochure. Why bother taking the time to create a great brochure if your audience only reads the front and then discards it?

Remember the basics. Don't ignore the basics when creating a brochure; it should include standard information, such as company name, at least two types of contact information, a logo and tagline. It should also include a headline on the front and two or three brief items outlining benefits your organization can provide. All text should be in brief, easy-to-read blocks to provide clarity for the reader. Add graphic images and photos of your product, services and/or key personnel for an eye-catching touch.

Don't confuse the reader. Avoid the temptation to list too much information on your brochure. Too many messages will confuse your audience and dilute your main points. Focus on what interests your target audience in a succinct manner, and they'll come away with an accurate understanding of what you can offer them and how you'll do it. It's OK to be proud of your business, but not at the expense of cluttering your brochure with irrelevant information.

Avoid big words. There's no need to impress your target audience by using hard-to-understand words that will send the reader scrambling for a dictionary. Your goal is to provide the reader with information regarding your organization, and triple-word-score Scrabble words and lengthy acronyms are hardly the best way to accomplish this. Plain speak is the best course of action.

Include a call to action. Don't assume your audience will be moved to contact you or purchase your product or services after they read your well-crafted brochure. An effective brochure should include a call to action, such as an offer for a free product sample or a free estimate or gift. This will entice readers and give them an incentive to act. Sometimes people need that extra motivation to contact you.

Don't be flimsy. A firm brochure is the equivalent of a firm handshake; it promotes confidence and competence. The weight, texture and overall feel are some of the first things someone will notice about your brochure. Use high-quality paper with a glossy finish to create a brochure that stands out. Handing out or mailing thin, flimsy brochures will signal that you put little thought and even less effort into developing your marketing materials.

Regardless of your business size or financial or design resources, the above tips will assist you in creating a brochure that will properly represent your organization, impress potential customers and call them to action.

Melissa Croweis the vice president of marketing servicesat VistaPrint, an online supplier of graphic design and printed products to small businesses and consumers. Please visit www.vistaprint.com for more brochure ideas.

7 Steps to Limit Your Importing Liability

Don't let red tape scare you away from the lucrative import market

By Chris Malta | June 25, 2008

URL: http://www.entrepreneur.com/ebusiness/dropshippingcolumnists/article195152.html

Any time you import goods into the U.S., you're legally responsible for ensuring that they comply with Customs regulations. This scares away many retailers and e-tailers from learning more. But, although steering clear of importing may allow you to avoid liability issues, it also means you're missing out on the considerable cost savings and unique, cutting-edge products that importing can afford your business.

"It really comes down to covering your bases," advises Kelby Woodard, principal of import consulting firm TradeInnovations.com. "There are some common-sense precautions you can take to limit your liability and protect your business interests."

He offers the following insights:

Start in phases.
Don't just jump on the internet and place a large order with a company you haven't vetted. Take your time, research potential suppliers, and start with small orders.

Consider starting out importing from a country that's close in proximity.
Mexico or Canada are the obvious options. Countries in South or Central America or the Caribbean basin will tend to have easier logistics than Pacific or Asian countries. And many of them have free trade agreements, as well, so they provide the additional advantage of being duty-free.

Do your homework.
In 1992, Congress passed a law that made the U.S. government responsible for making all necessary knowledge on Customs regulations available to importers, either by website or publication. This concept is known as informed compliance. There are several online resources that can help you learn more about your responsibilities in this area:

• CBP.gov is the official website for the Customs and Border Patrol. As part of the agency's informed compliance requirements, its site offers a great deal of education regarding different import regulations.
• TRGDirect.com offers information for companies or individuals interested in learning how to file their Customs entries directly, without the services of a Customs broker.
• TradeBridgeInternational.com provides a vast amount of knowledge geared toward helping small- to medium-size importers.
• TradeInnovations.com provides direct information on the subject of importing, as well as numerous links to other useful sites.

Use a third-party validation firm.
A validation frim can inspect the quality of your products and ensure that they meet all applicable U.S. requirements. While you can't outsource your liability, you can get expert help with the process.

Go multinational.
As you increase your importing volume, you might think about sourcing your products from multiple countries. If quality assurance problems or customs issues arise in one country, you're not cut off from your only product source.

Watch your buying terms.
If your purchase agreement states that you're buying your products FOB (Free on Board), then your supplier is responsible for getting your goods through the export customs process. You take possession of the goods at the foreign port and handle the logistics involved in clearing the goods through U.S. Customs.

If, however, the terms state that you're buying X works or X Factory, then you take possession of the goods at the manufacturer's shipping door. That means you're responsible for knowing and following not only your own country's import regulations, but also the export regulations of the country in which the manufacturer is located. So pay attention to your agreement, and make sure you're comfortable with the terms before you sign.

Keep thorough, accurate records.
Keep a detailed paperwork trail and have that documentation available, whenever Customs requests it. This will not only help protect you legally, it will also speed up the time it takes to get your goods cleared.

Informed compliance and legal liability may sound like daunting terms; but don't let them scare you away from realizing the tremendous deals importing can supply. It's really just a matter of taking some very simple steps to mitigate your risk.

Says Woodard, "If you do your due diligence, you don't need to worry. The benefits of importing far outweigh any extra effort that's required on your part."

Chris Malta is the founder and CEO of Worldwide Brands, the internet's leading authority on product sourcing for e-businesses. Chris was hand-picked by eBay Radio as their exclusive product sourcing editor, and has authored numerous books on e-businesses and product sourcing, including What to Sell on eBay and Where to Get It and How to Find Real Products You Can Sell Online.

Robin Cowie is the president of Worldwide Brands, as well as a business development and marketing specialist, and TV and film producer. Robin is a regular featured speaker at eBay's live national convention each year, and is the co-author of eBay Performance! Selling Success with Market Research & Product Sourcing.