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When you have a website or other online presence, you know that you need to use SEO or Search Engine Optimization to get your business links ranked at the top of internet searches. But can you do it yourself?

My answer is yes, as part of a guerilla marketing strategy. Eventually as you grow your business you will likely hire an expert, but in the beginning there are a number of things you can to improve your rankings.

Even though SEO is a good strategy to make your website known and to get more leads and customers, it takes time and effort. Starting out, read some related blogs or articles. Watch a webinar. Ask other business owners and partners how they tackle this truly important strategy.

With SEO, there are plenty of things you can do on your own that won’t cost you anything but a few brain cells:

Know Your Keywords

As you attempt doing your own search engine optimization, the first focus point should be keyword research. You must know the words or phrases people are using to find your products or services, which drive them from search engines to your web site or social media channel.

While you know the names, characteristics, catchwords, and jargon associated with your offerings, don’t assume that buyers do. Do a little digging to discover the verbiage being used in internet searches – try using some free tools like Google Ads or Google Keyword Planner.

Future outlook: Voice searches are rising, and are expected to be used for half of all searches. This will necessitate using more conversational phrases instead of individual keywords.

Check Out the Competition

Looking at your competition’s online presence can help you figure out how you can get more visitors and sales. While you shouldn’t just copy what your competitors are doing, it can be quite useful to see what they do and how they do it.

Conduct your own searches for services or products that you offer. Click on the website results that Google returns and do a little investigating:

  • How does your competitor rank in search results compared to your company?
  • Do they have a comparable business model to yours (similar pricing structure, services, products, online storefront)?
  • What they are doing well (branding, easier navigation, more photos or testimonials)?
  • How do they engage with their prospects (pop-ups, videos, trade shows, person-to-person, etc.)?

Social Media

Platforms like Facebook, Instagram, Twitter, LinkedIn, and YouTube are incredibly important in terms of search engine optimization.

While having a YouTube channel doesn’t by itself rank you higher in search results, it starts a chain of events that does. Worthwhile content gets followers, who share links with others … your brand grows, traffic increases to your site … website shows up higher in searches.

If you don’t have a social media page, build one! It continues to be one of the best ways to share your content and to drive more targeted traffic to you.

Think It Through

After completing the earlier steps, you can now look at your website from a different perspective. You should have a clearer idea about what your target audience is looking for and how your competitors are offering it.

Now, take a look at your website again. Choose the most important pages and the right keywords to get consumers there. Driving traffic to these pages is what will create interest, draw them into a funnel and, ultimately, make a sale.

Recommendations:

Pop-ups within your site are a great method to drive your web visitors to connect with your sales team or to go where your products and services can be purchased. Be careful in your design, though – as of 2017, “intrusive” pop‑ups (ones which that a mobile user has to dismiss before being able to access the main content of the page) will get you penalized by Google.

Include your target keywords in: content, images, all types of links, and in URL slugs (ex: www.mywebsite.co/keyword).

Polish up your content – it should be:

…   typo-free

…   professionally written

…   keyword-rich

…   mobile-optimized (test it)

…   of value and relevance to your target audience

Optimize your website by:

  • following Google guidelines
  • avoiding broken links
  • partnering with other site owners to provide backlinks to each other’s pages
  • making it user-friendly (test that, too)

Keep it Fresh

Content is crucial in any SEO strategy. However, we understand that you may not have the time to publish a blog post every day.

You just need to strike that balance in making Google happy by publishing new content frequently. The main focus should always be ensuring that your content is unique, valuable, and consistently refreshed. Good, relevant content ensures people will share it.

Remove stale copy

Don’t forget that publishing content with relevant keywords is not just about text – there’s also videos, photographs, imagery, and infographics, among others.

Analyze Results

Measuring your results is crucial to knowing if your efforts and strategy are paying off. After all, how can you know which page gets the most visitors? Or the pages where your bounce rate is higher? Or what content leads directly to purchases?

Find the right website analytic tool for you, based on the data you want to collect as well as its ease of use, power, and cost. There’s Google Analytics, SEMrush, and Clicky, to name a few. 

SEO may not be what you thought would keep you up nights, but it can’t be ignored in the quest to guide traffic to your stuff.

Unfortunately, SEO is not a once-and-done job. Due to the continually changing universe of factors like search engine formulas, terminology, marketing trends, and user devices, you’ll need to regularly review and analyze what gets your links high on search results and drives consumers to your products and services.

The post Search Engine Optimization: Can You DIY? appeared first on Small Business Coach Associates.

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Your electrical service company likely provides residential and commercial customers with a full range of design, installation, repair, inspection, and renovation work.

While highly skilled in all things electrical, many of these independently owned service companies face challenges in strategy, organization, communications, and marketing.

We at Small Business Coach Associates would like to offer 6 effective methods that will specifically help an electrical service company to grow and succeed.

Six Best Marketing Tactics to Grow Your Electrical Service Company

The following approaches can make a significant difference in working smarter, not harder as well as building up team rapport, improving customer service, and reaching your target clients.

  • A Catalog of Contacts
  • Relationship Building
  • Follow-Up
  • Word of Mouth
  • Services, Services, Services
  • A Marketing Strategy

Following is more detail on how to easily implement these tactics:

#1 Arrange Your Contacts in Your Database

As the owner of an electrical service company, we are sure that you have contact info from most (if not all) past and current customers. However, you probably don’t have them all in the same place.

When the time comes to send a message or announcement about a new product, location, event, sale or other promotion, you want a simple way to send the same message to the same group of contacts at the same time.

Gather up the accumulated business cards, post-it notes, email contacts, and all online or paper lists to compile your customer contacts in one place.

You may also add names of people you’ve met while networking and at events. You may include contact info from vendors, contractors, partners, or other business associates.  At a minimum, keep their name, company, and email address. Consider including other data that you might need for a communication such as phone number, address, last contact date, type of contact, or description of work provided.

You can store this data many ways, such as in an online app, an Excel spreadsheet, or a Customer Management System like SalesForce or ActiveCampaign. You can keep everything in an email “group” consisting of only business contacts (no friends, family, et al).

Whatever method you employ, be sure to update it regularly.

With a ready-to-go list of contact information, promotional campaigns will be a breeze … and that will result in … new business!

#2 Build Better Team Relationships

When you have a small business with a limited number of staff, like an electrical service company, it is important that all the members of the team get along, are acknowledged, and are empowered to play a part in your company’s success.

Having a good relationship between the different staff members allows your electrical service company to work better. This culture can be fostered through individual recognition, respect, teamwork, and communications.

A great first step is in recognizing that any team member (whether full-time, temporary, or intern) may bring not only potential customers but also possible ideas that further your success. They can recommend your services to their friends and families. Their attitude and enthusiasm may be the reason that some customers continue to use your firm.

To nurture their job satisfaction, input, and work ethic, find ways to:

  • Acknowledge the good – which can be as simple as an email recognizing what they’ve done well, a “Job Well Done” sticker, or a $5 gift card.
  • Come together – have regular all-hands meetings to discuss the state of the business, to talk about new plans, or announce promotions. Allow time for Q&A.
  • Keep your door open – sincerely offer for staff to come to you or their manager with their ideas or potential leads in addition to their concerns or feedback. All input can play a role in better working relationships and a more successful business. 

#3 Follow-Up

A rather simple method to build a good relationship with customers is through follow-up communications.

Make a call or send an email after a service call or when a project is completed. Ask for a ranking or feedback on aspects such as:

  • Response time
  • Professionalism
  • Efficiency
  • Cost

This method will, first, give you an idea of areas needing improvement while, second, building rapport. You can include a short questionnaire about these key points.

You can take this opportunity to thank the client for choosing your company and to offer a discount or gift card for new clients they recommend. You can even remind them of your guarantee or warranty, or request a testimonial on your website or social media page.

Doing follow-up communication is a clear signal that you care about your customer’s satisfaction and about doing a good job.

“We would like to recommend Alan at Small Business Coach Associates for making a large impact on our business. We are on track to double our generator sales this year. We gave ourselves and our employees raises, and we have paid an additional $75,000 on a loan that is nearly paid off. We have improved our quoting process, our sales process, our collections process, and our conversions process.  These improvements have resulted in a big positive impact on our sales and cash flow.  Additionally, we are offering financing and other value-added services which have benefited our customers and our business. Finally, we are taking more time off: 5 weeks this year!” Andy and Joan Helton, Owners, Electrical Service Providers

#4 Cultivate Word-of-Mouth References

When someone needs an electrical service company, they no longer turn to the yellow pages and call the first number they see. Most people ask friends and relatives if they know someone who can handle the job.

According to Nielsen, 92% of people trust recommendations from friends and family over any other type of advertising. Plus, after analyzing specific case studies, researchers found a 10% increase in word-of-mouth [offline and online] translated to sales growth of up to 1.5% (source: www.bigcommerce.com).

So, you want to put some thought and planning into how to get the word out there.

The best strategy to get a reference will always be to maintain a high standard of service, be professional, and have a great relationship with your clients, staff, vendors, and other business contacts.

Consider a promotional plan, such as offering a $10 gift card to anyone who sends you a new customer. (Include employees in this, too!)  Flood your local area with promotional products – like baseball hats, t-shirts, and signage.

Use your social media presence as a referral channel, and for reviews. FaceBook, YouTube, and Yelp play a major role in building trust and getting new business.

On your web site, emails, social media pages, and marketing materials, (1) include testimonials from homeowners and businesses that you’ve serviced, and (2) apply your branding.

Ensure that social media platforms present a bright and glowing view of your company and its services. Don’t forget to check Angie’s List and Yelp reviews and rankings –

If it’s an unfair comment, respond to it (of course) with all the professionalism you can muster.

If it is a fair but negative appraisal, respond by first contacting the unhappy customer and making things right, then reply online with that story.

#5 Offer More Services

Once a customer has experienced your services, don’t neglect to make them aware of the range of other services you offer. Take time to let them know you can do more than just hang a light fixture or repair a broken wall outlet.

Communicate that you can wire any size home, office, or commercial building. Let them know you do home inspections.

Publicize seasonal offerings like the installation of Christmas lights or yard displays. In the spring, show them photos of your most impressive outdoor lighting projects. People will be enticed by a photo of decorative strung lights on an attractive deck, or by discretely placed colored lights showcasing their home. Offer a free estimate on how to make their home look unique and upscale.

Consider offering service contracts, especially for commercial businesses. In such an agreement, a client would engage your company to exclusively perform electrical services.

Keep abreast of what customers want – if you don’t provide that service, then consider adding that to your offerings. That may require hiring new employees who are already trained and certified

#6 Define Your Marketing Strategy

As with any other company in any niche or industry, you need to have a well-defined marketing strategy. 

Research the answers to these questions:

  • What geographical areas do you serve?
    • Do you see your geographical areas expanding in the near future?
      • If yes, to where?
      • In any new service area, what will be different (weather, household income, number of commercial properties, etc.)?
      • Will it require new hires?
  • Who are your target customers (homeowners with over $100K income, small business owners with 20 to 40 employees, local home developers)?
    • What is the best marketing method to reach that audience?
  • How much do you make in each type of work?
    • What types of work gave you the most profit over the last year?
    • What type of work do you anticipate will increase or decrease in demand in these areas?
  • What is your Unique Selling Proposition? That is, explain what it is about your products, services, delivery, culture, etc. differentiates you from the competition.
  • When are the times of year when your services are most in demand?
  • Are you willing to add more services to your company?
    • What type of services are becoming more in demand?
    • Which services have the highest ROI (return on investment)?
    • What will this require (special skills? training? new marketing approach? added staff/subcontractors)?
    • How much of a financial investment will be needed?
  • Which methods of marketing have been the most effective (social media, TV, radio, newspaper, word-of-mouth, mailers, networking, etc.)?

Use the answers to develop your approach about WHO to market to, WHAT to promote, HOW and WHEN to advertise, and WHERE to market.

Employing these tactics can only improve the morale of your team, please your clientele, and increase your market share.

In the ever-shifting nature of areas like strategy, marketing, and communications, owners of an electrical service company can never stop working on ways to grow and stay competitive.  

The post Grow Your Electrical Service Company- Six Ways appeared first on Small Business Coach Associates.

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Email marketing continues to be a great strategy to grow business. It’s free and doesn’t require a ton of effort to produce. I’m sure, like me, you get numerous newsletters over any given week. If you don’t have your own email newsletter in place, it’s time to consider starting one.

An email newsletter is one of several tactical marketing strategies that we have been writing about. Additionally, a series of email newsletters can be a strategic marketing strategy, which is longer term in nature. You want to “touch” your subscribers at least 12 times. Eighty percent of all sales happen between the 5th and 12th touch. Although you are not likely to win a lot of clients through emails alone, these messages can take your client down the path to your business.  

When brainstorming the idea, there are a few major aspects to consider:  your target audience, your intended purpose, the content, a design for mobile devices, and a compelling subject line.

We’re going to tell you, step-by-step, exactly how to create your own email newsletter.

So, what can a newsletter do for you?

  • Connect with potential clients
  • Establish you as a leader or expert in your field
  • Build trust in you and your business
  • Enhance brand awareness
  • Determine consumer needs and interests
  • Increase traffic to a designated site
  • Acquire more leads
  • Generate more sales

Now, how do I accomplish those outcomes through a newsletter?

  • Provide relevant news, tips, and information
  • Publicize events
  • Send announcements
  • Promote products and services
  • Make special offers
  • Cross-promote partners and business contacts
How to Create Your Newsletter

It’s obvious that there are many good reasons to create a newsletter. It can be a great direct marketing method, and a “goodwill” service for your audience.

Step #1: Establish Your Newsletter Goal

While you’re convinced that you should use email marketing, the next step is to determine the main goal of the newsletter. Ask yourself how it fits into the rest of your marketing strategy.

You may want to simply get more email contacts, announce your company’s launch, or promote a new product line. No matter your goal, make sure to keep it in mind as you work through the creation process.

With an established goal, the next move is to plan your content.

Step #2: Define the Content

Emails should be one of two types to get people to read them: Educational or Entertaining. A mixture of both is even better!

A couple years ago I was working with the owner of a printing business. He was a genius in delivering outstanding content while making it very interesting. He was able to achieve a 60% open rate for his email newsletters, which is outstanding!

Put together content that is useful and relevant for your intended audience. Don’t constantly try to sell something. Build trust by providing helpful, engaging, and well-written material.

You don’t have to grind out all new copy each time. Re-purpose existing content from your blogs, training materials, articles, and marketing brochures.

Make it entertaining by adding jokes, quotes, cartoons, or stories. (I always read an antique dealer’s newsletter because it included stories from readers who found a bargain-priced treasure in a junk shop, yard sale, or other unexpected place.)

Think about how often you plan on sending the newsletter, where you may have already composed content, and its optimum length.  

The next move on your path is to create an outline to follow for each release.

Step #3: Layout a Template

You can use an email service provider’s template but, in our opinion, you should stick with your website design look-and-feel. This promotes your brand (logo, colors, fonts), makes it fit your needs and goals, and your subscriber will immediately recognize that it comes from your company. Make it distinct and unique. 

Now, the format.

Pick from this optional list of formatting elements and characteristics:

  • Text (fonts, colors, sizes)
  • Layout (length, margins, justification)
  • Highlighting (bold, italics)
  • Imagery (logo, photos, cartoons)
  • Columns
  • Tables
  • Lists (bullets, numbers)
  • Repeatable section titles
  • Links (to landing pages, videos, web sites)

Again, let your website style and branding choices drive the look of your newsletter.

Bottom Line > your email template must be mobile-friendly.

Once you have the format down, start compiling your content.

Step #4: Add Your Body Content

Using your template as your outline, start filling in your text and images.

For long body content, definitely use images to break it up. Just as with your website, it’s important to keep a balance between text and images so that your audience keeps reading. Size any imagery so that it doesn’t overtake the size of the text.

Don’t forget to run the draft newsletter by a few people, either inside or outside your organization. Ask them to give honest feedback, including pointing out typos, poor grammar, and factual errors. You could follow up with a short of list of questions to determine if the material met your goals, like:

  • Did you enjoy or appreciate the content?
  • Was it professional?
  • Did you learn something?
  • Was it too long or too short?
  • Would you like to continue receiving it?
  • What part of it did you find most valuable or interesting?

Step #5: Create a Powerful Subject Line

The most difficult part about an email newsletter is nailing down the subject line. It should be short, compelling, immediately actionable, and click-worthy. This bit of magic can be hard to pull off.

Think of it this way – subject lines are just like headlines on your website or the titles of your blog posts. They need to express the idea without telling everything while compelling the reader to want to see what’s inside.

A few points to consider for the all-important subject line:

Is it attention-grabbing?

Does it relate to the email recipient’s needs or interests?

Will it help them solve a pain point or challenge?

Will it spark their curiosity?

Does it match the email content?

Is it a mobile-friendly length of under 40 words?

Can we personalize it by including their name?

Is the spelling, grammar, and punctuation correct?

Did I avoid using CAPS or special characters (!!!)?

Brainstorm some attention-grabbing words and phrases such as:  sneak peak, secret, hidden, solution, little-known, exciting, must know, avoid these mistakes; free, clearance, and discount always get my attention. Avoid spammy verbiage like amazing, open right now, or we need to talk. At any cost, don’t let your subject be vague or boring.

Test out your subject lines just to see if they land in the recipients’ SPAM folder. “Free” may be an appealing word but it can trigger a spam filter.

Practice Makes Perfect

Over time, you’ll get better with practice and by paying attention to what is and is not working with your email list.

NOTE:  Don’t neglect to keep it legal. There is a law called CAN-SPAM which requires you to include an “unsubscribe” option in each email, along with your contact information.

Now that you have created your educational and entertaining email newsletter and determined your intended recipients, you only need to send it. However, your work isn’t done. Take the time to analyze the results. By analyzing open rates, click rates, and other metrics, you’ll be able to understand what you need to do better next time.

Have email newsletters worked for you? Any tips you would like to share with other business owners? Reply in the comments below.

The post How to Create an Email Newsletter appeared first on Small Business Coach Associates.

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A landing page is a stand-alone page meant to capture contact information from visitors who are interested in your offering. Its secondary but key purpose is to convert visitors into leads. Statistics strongly support that a landing page can significantly increase your conversions.

A landing page is one marketing tactic that flows from your Strategic Marketing Plan and directly from your Tactical Marketing Plan we discussed in this previous blog post.

Whether you are promoting a webinar or workshop or selling a product or service, having a well-designed page is crucial to driving traffic where you want them to go.

Designing a landing page requires a different approach than designing a website or newsletter.

We’re providing some guidelines which should ensure that you have a high-converting landing page.

Determine the Goal of Your Landing Page

It sounds obvious, but taking the time to determine what you’re trying to accomplish with the landing page will put you ahead of the game.

What are you really trying to accomplish with the landing page? Don’t think about what they’ll get (like a newsletter or product sample) but focus on defining the point of the whole process. Is it to:

  • Create brand awareness?
  • Foster credibility and trust?
  • Capture email addresses?
  • Get more visitors to your website?
  • Make more sales?

If you’re clear on the end goal, then a clear design will follow.

Still, every page should have only one clear path which takes each visitor to the right destination.

Provide a Lead Magnet

An attractive, compelling offer is what drives the visitor to give up their email address – it could be a free eBook, instructional video, blog, checklist, or template.  You must provide a lead magnet that is of relevance and value to your target audience.

Best Elements of a Landing Page

To create a compelling and converting landing page, ensure that:

  • Your Copy is Concise and Clear

Copy on a landing page should be minimal – a few sentences at most. Save the longer copy for emails and blogs. Be short and persuasive. Get straight to the point.

All the sentences need to have one purpose – for the user to act immediately.

  • Don’t Ask For Extras

Your landing page “form” should only for vital data such as name and email address. Asking for any other info will significantly decrease the chances to get users to enter their info and click that button.  Best practice: Ask just for first name, and only if you plan to use that data immediately (such as in an email campaign.)

If you are selling a product or service in your landing page, make the process as simple as possible. Only ask for information that is absolutely mandatory. After their order is placed, you can ask for all the information you need.

  • Write a Call-to-Action That Works

In any landing page, the verbiage in your call-to-action button is crucial. Avoid the generic “Click Here” and use strong words and compelling phrases like:

“Get a free WORK SMART, NOT HARD checklist”

“Subscribe to the Savvy Business Newsletter”

“Grab my free marketing video package”

Employ a clear and direct call-to-action that makes the user want to act immediately.

Designing a Landing Page

As already mentioned, designing a landing page is completely different than creating a regular web page.  While one part of the difference is related to short, simple copy, the other part relates to its design.

A good design should support the call-to-action. That means being concise on your landing pages and getting straight to the point. So, your design should be simple. Keep these major aspects in mind:

  • Simplicity. Your landing page should be a “No Distractions Zone.”  Keep the user focused on clicking that call-to-action button. Do this by not including any other clickable elements like logos, icons, or hyperlinks.
  • Branding. You want the user to recognize your branding elements (fonts, colors, layout, logos, etc.). Keep the look consistent from emails to landing pages to your website. Carrying your brand forward avoids confusing the visitor and gives them confidence in your offer.
  • Copy Length. While some use a landing page to further elaborate on their business or offerings, the most successful ones will contain only the basic elements:
    • An explanatory or motivational heading
    • Two to three short paragraphs
    • Field for email address
    • A call-to-action button to get the offering promised
  • Imitate What Already Works. A good practice is to find and capture a landing page to use as a model. If you thought that their page was simple yet effective, then your visitors will like yours, too.
  • Imagery. You can add an image or photo on a landing page, but don’t over‑do it. The user just wants to get what’s being offered in the quickest way possible.
  • The Fold. If the user has to scroll down to see the call-to-action (falls below the “fold”), then you will lose out on your conversions.

For such a simple and temporary page, there’s much to consider when driving visitors to give up their precious email. We know that clicking not only means we get some freebie, but it also means we’ve signed up for the offerer’s future emails. Making it easy and quick to use, worthwhile, and professional will give them the trust to accept us and what we’re offering.

What are your thoughts about creating your own landing page? Do you think this marketing tactic could help you grow your business? Let us know your thoughts below.

The post How to Create the Best Landing Page appeared first on Small Business Coach Associates.

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Any small business owner knows they must create a marketing plan and update it regularly. This is an extremely important tool to plan how to sell and to track your sales performance.

Whether this a start-up plan or one created after you’ve launched your business, the fundamentals remain the same.

When tackling the subject of marketing, you must first understand the difference between the strategies and tactics of a general marketing plan.

Strategic Marketing Vs. Tactical Marketing

Strategy refers to the overall vision and approach you want to follow towards your goals, while tactics involve the actions needed to fulfill your strategy.

A sampling of marketing strategies might include:

  • Create a strong and consistent online marketing campaign via social media most used by target audience
  • Build loyalty and trust with free webinars, content, and videos
  • Negotiate with large-scale retailers to sell products
  • Bring product quickly to market to take advantage of a new trend

Marketing is what allows you to place your product or service in front of prospects. It’s also how you create brand awareness. Your approach to marketing is to ultimately pull in potential clients, make sales, and bring in the cash flow needed to make a profit.

Not surprisingly, the topic of marketing can be intimidating to a business owner because of all the daunting research, data, and choices. As any small business coach will tell you, the typical self-employed owner has to wear many hats to get their company off the ground >  designer, pitchman, social media maven, copywriter. Unfortunately, most are not marketing geniuses.

Once you have an overall strategy, you’ll need to consider the tactical marketing actions needed to achieve those strategic goals.

First, find out what should be in your Strategic Marketing Plan.

Strategic Marketing

As you develop your plan to market your company’s products and services, it all begins with your marketing strategy. This is what determines the direction that your business will follow. Usually it addresses a broad view of the long term, but there’s no reason you can’t start with a high-level vision and narrow it down whenever you want.

Both management and operations should engage in developing this key element.

A strategic marketing plan generally covers:

  • Mission Statement or Goals. Defining what the company wants to accomplish. Write out your USP (unique selling proposition).
  • Market Trends. Spelling out current market drivers that are happening now. Maybe your furniture store decides to sell trendy upcycled furniture in addition to standard inventory.
  • Target Audience. Discerning the demographics of who wants or needs your offerings. If you’re a business coach, then this group would include entrepreneurs, small business owners, and independent business owners.
  • Budget. You have to consider the numbers. Set a limit on how much to spend on:
    • Social media or landing pages or newspaper ads
    • Printed materials, business cards, or banners
    • A consultant, copywriter, or website designer
    • Networking or club fees (have to get out there face-to-face)
    • Associated technology or software (iPad, projector, security)
  • Customer Retention. A plan to ensure repeat customers, thus repeat sales. Possibilities are rewards programs, special promotions, and regular clearance sales. You could giveaway hats, bumper stickers, or the like.
  • Pricing. Assign a price to your products and services which reflect not only their quality and worth, but also on the cost to produce and what the market will bear. You should also consider special pricing:
    • Will there be discounts for large volume bundles?
    • Does the price include guarantees or warranties or can they be sold separately?
    • Will you have special sales or offers at certain times of the year?
  • Promotional strategy. General approach to sales such as radio and television ads, teleseminars, trade shows, social media, email campaigns, and networking.
  • Distribution. Delineate your high-level strategy for getting products and services to the customer. Will they buy online or in a retail shop? Will customers be able to purchase at special venues/events or at face-to-face meetings? If shipping is needed, how will that be done economically?
  • Your Competitive Edge. Identifying and assessing your competition will be crucial in figuring out where your company stands in the marketplace. If you open a hardware store, you must know how your company will compete against giants like Lowe’s and Home Depot.
  • Partners, Referrals, and Joint Ventures. There could be strong benefits in collaborating with peers, contacts, and other business owners:
    • Referrals for your products or services
    • Sharing email address lists for promotional campaigns
    • Cross-promoting events like showcases, workshops, and teleseminars.
  • Whether you see them as weaknesses, shortcomings, threats, or roadblocks, you must be aware of the potential risks to your success, like:
    • insufficient or inconsistent income
    • inability to find a skilled workforce
    • lack of business experience
    • being new to a saturated market

You should now be able to confirm if your small business has the finances, resources, and foundation to grab market opportunities while tackling those threats that will pop up.

After defining your overall marketing strategy and goals, you’ve gotten a better grasp on elements like demographics, trends, costs, risks, and logistics. Now, you can then start to develop the actual tactics to reach those goals.

Tactical Marketing

As mentioned, tactical marketing refers to the actions to take towards reaching your strategic goals.

Tactical marketing should address the steps needed to reach goals such as building websites, generating leads, placing ads, and promoting sales.

Set your tactics according to your available resources > primarily budget, personnel, vendors, partners, materials, inventory, and facilities.

Developing Your Tactical Marketing Plan

You will find yourself needing two different tactics: foundational and ongoing. Foundational tactics are the ones that you just do once (such as creating your website), while ongoing tactics are the ones that are used in different ways over time (such as promoting a product).

A tactical marketing plan doesn’t have to be a specific size or shape. The main point is that it adapts to your needs, resources, and business objectives.

Following are typical elements of a tactical marketing plan:

#1 Tactical Decisions With Products and Services

This section covers what you want to do with new products and services. It’s the right place to include all the related aspects around decisions needed to market your offerings. It is also important to brainstorm any downstream effects or changes that this may bring, such as changes to your manufacturing process or the need for a new distribution channel.

Begin with an overview of current offerings, which might include:

  • Product and service descriptions
  • Key features
  • Main benefits
  • Manufacturing/development processes
  • Branding
  • Packaging
  • Distribution

#2 Tactical Decisions With Promotion

Describe how your products and services are going to be promoted. This part of your Tactical Marketing Plan usually includes four potential promotional approaches: (1) advertising, (2) sales promotion, (3) personal selling, and (4) public relations.

For this section, timetables are incredibly important. Let’s say that you are considering setting up at a trade show or buying magazine ads. These types of promotions can require long lead times.

In the case of buying magazine ads, lay out timeframe and milestones for:

  • researching which magazines reach your target demographic
  • comparing pricing among magazines
  • choosing the ad size, copy, and imagery
  • deciding on the perfect time (month, season) to place the ad

The majority of section should employ graphs and tables to represent key information with a glance.

Include special promotion programs that you define for holiday, seasonal, local events, or other benchmarks.

  • Advertising Objectives: Can address a range of objectives like respond to competitor promotion, encourage product trial, build traffic, increase use or purchase rate, and branding. You should also clarify the ad type to employ, such as direct mail, billboards, social media posts, or television spots.
  • Sales Promotion Objectives: May include goals such as build traffic, encourage repurchase, increase product trial, support other promotions, and build inquiries. You should also clarify the sales promotion type that you’re going to use – it may be product demonstrations or coupons, for instance.
  • Personal Selling Objectives: Could involve aims like encourage purchase, develop new accounts, build traffic, increase product trial, and support accounts. You should also clarify the selling type that you’re going to adopt, like a call center or a sales force.
  • Public Relations Objectives: Might cover actions such as respond to negative news, report an upcoming activity such as a new product release, build inquiries or traffic, or promote a sale or event.
    Spell out the possible PR choices – a press release, social media post, pitch to media, or any other.

#3 Tactical Decisions With Pricing

To write this section of your Tactical Marketing Plan, you need to have good knowledge about economic conditions, the market, your competitors, and your customers.

You may want to use both graphs and tables that allow you to display the different pricing decisions and trends in each one of the categories that you plan to define.

Other Important Areas

There may be less major decisions to make such that your small business reaches its goals, which might cover:

  • Marketing research
  • Customer support service
  • Calls-to-action (Ex. driving potential customers to download a PDF, go to your website, etc., sign up for a teleseminar)
  • On-hand inventory
  • Focus groups, surveys, or other means of customer feedback
  • Thresholds, metrics, and measurements

Drilling Down
This is the moment to lay out the details on accomplishing your tactical goals – it’s time to drill down what, who, when, where and how.

WHAT          You need to outline all the tasks that need to be completed to reach the business goals that you defined in your strategic marketing plan.

WHO           Identify the human resources with the skills and knowledge to accomplish the tasks – will it be you, an employee, temporary, consultant, vendor, or intern? If staff not yet in place, use a title (Lead Mechanic, CEO, Editor, Salesperson).

WHERE       Specify if tasks are done on-site or off-site (at a networking event or trade show, or by a third-party vendor or remote worker).

WHEN         Know the timing and order of when things must happen – i.e., a website host site must be in place prior to hosting a webinar.

HOW           Develop the procedures or processes for personnel to execute by.

As always, you know that you can count on our Small Business Consultation Services to ensure that you are on the right track for growing your small business.

Conclusion

Your Marketing Plan allows you to know your company’s direction, the course that you are following, and your planned destination.

With a well-detailed Tactical Marketing Plan, you will have a measurable plan that includes your estimates in terms of product and service offerings, promotions, pricing, and other relevant areas.

It’s important to check regularly that your plan is on-track and to make adjustments as trends, costs, and resources change.

Do you have a marketing plan? If so, how is your plan impacting your business. Let us know your thoughts in the comments area below.

The post How to Develop a Marketing Plan appeared first on Small Business Coach Associates.

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A Unique Selling Proposition or USP is a company’s distinctive “hook” that tells the marketplace what sets them apart from the competition. Your USP defines the reputation and value of your company and allows you to charge higher prices than lower value commodity products or services. Your Unique Selling Proposition is strategic and long-term, while your tactical marketing plan is short term.

Research has shown that most people check out 4-5 different places before purchasing goods or services. Having a magnetic USP can turn the buyer’s head. Much like curb appeal is to selling a home, a USP is crucial to making a significant first impression that results in a sale.

Your USP should tell the story of how your product or service is different or better than your competitors. It identifies your strongest values or benefits – and drives customers to choose you, not them.

Characteristics of Good and Bad USPs

 * *  Best Elements  * * * *  Worst Elements * *
Contains specific benefits or features A general statement without detailed information
Clear, easy-to-understand, simple Confusing, vague, jargon, hype (superlatives like “stupendous” or “world-famous”)
Unique and distinctive from competition Generic, common offer. Using platitudes- “we offer quality.” Your competition is saying same thing.
Short and concise Rambling; too long
Attention-grabbing; exciting Forgettable
Explains how you can solve customer problems Doesn’t clarify your value in solving customer needs
Uses different language than that of company or product names Repeats wording from your company name or offerings
Appealing verbiage Bland, boring wording
Focuses on benefits Just talks about features
Exhibits value, solution, or uniqueness Is really a mission statement
Is based in sincerity and commitment Says only what they think the customer wants to hear

The best USP should be truly one-of-a-kind – there’s no point in making a distinction about yourself that’s already being used by competitors. It also should be something that your customers want … and recognize as a benefit. Let’s look at a few examples that spell out the difference between better and poor:

Bad USPs Good USPs
An email automation business uses the tagline “The ultimate solution.”

It’s a vague claim that says nothing about what makes them different.

An HVAC company – Their jingle is “There’ll be cool air at your house tonight!” Potential customers immediately get their guarantee that service will be fast and effective.
“Connect your entire workforce with <name of company>.” Focuses on a feature, not a benefit. WalMart – Has the lowest price. Not a tagline, but this megastore’s unwritten value proposition is undeniable.
A software firm declares “We provide systemized technological solutions for query-based operating systems in a Linux environment.” It doesn’t exactly role off the tongue, nor is it something a customer will remember. Also, avoid “we,” “our,” and “I” as it’s company-centered, not customer-centered. Avis – “We’re number two, so we try harder.” This promise is so believable.

Fundly – “Raise Money for Anything.” Everybody knows what they do in a second.

Listia – “Get rid of old stuff. Get new stuff for free.” And, it gets right to the point.

“Serving the entire Southeast.” Well, they do cover some territory, but lacks the details needed to stand out. LegalShield – “Worry Less. Live More.” Easy to remember and is compelling. Who doesn’t want this promise?
A hair salon: “We’re a cut above the rest.” Not what you’d call unique. Tiffany – Provides the highest quality luxury items. Tiffany’s 180-year reputation is known world-wide.

So Whats Your USP?

As you can see, creating a great USP requires some soul-searching, knowledge of what your customers really want, and a bit of writing finesse.

You can consider these questions to ferret out your true value proposition:

  • What are the aspects of our services or products that make a difference to buyers?
  • Who is our target audience/client?
  • What are the pain points of our ideal customer?
  • What problem(s) are we solving?
  • How is your company or offerings different from the competition?
  • What do my existing clients say they like about our business or offerings?
  • Which are my company’s greatest strengths?Why do we stand out?
  • Since your company is a reflection of you, how are you unique?
  • What are the concrete, most desirable benefits that you give customers?
  • Exactly what are we selling?
  • How do we clearly and concisely state our USP?

Creating a USP Where None Exists

If you’re struggling to find your own unique selling proposition, that could signal there’s something missing. Consider adding worth or uniqueness through some of these value-adds:

  • Guaranteeing your work. Providing a guarantee is well-honored way to build trust with clientele. Potential customers see value in a company that will back up their work with a promise to make things right when a customer has a complaint about your product or service.

One distinction – a “guarantee” in this context is a verb; it offers a promise. A “warranty” is a noun; it’s a written contract.

Factors to consider when defining your guarantee:

  • Be specific. A promise of “Your satisfaction is guaranteed, or your money back” is too open-ended and open to interpretation. This generalized statement invites abuse by a client, and can end with bad feelings all the way around. It could result in a poor rating on Yelp, which can be damaging to your reputation and future business.
  • It should address the main frustrations of your target customers. If you’re a hotel, guarantee what you know customers are typically concerned about.
  • Make it impressive.Avoid being too humble – make sure they know you firmly and boldly stand behind what you say.
  • Ensure you can and will back up your guarantee! If there’s a possibility that fulfilling your guarantee may not be immediate, but that it eventually will be done, then let customers know that.
  • Empower your employees to immediately honor your guarantee. Then back your employees’ decision without fail.

A Ritz-Carlton hotel was the largest client in one of my past businesses. This world-class hotel chain did not want any of their clients to walk away disgruntled because of an incident, regardless of fault. Their policy was for any employee who became aware of a problem instantly became “the owner” of the problem. Every employee was required to immediately pacify the customer with up to $2,000 worth of room upgrades, meals, concierge services etc. without management approval! This kind of guarantee was one of the practices that made the Ritz Carlton world-class.

  • Developing a distinctive brand. Your logo, colors, fonts, and graphics can say a lot about you and draw in customers while indicating your unique selling proposition. A compelling visual identity can instantly tell a prospect who you are, what you do, and how well you do it.

Companies who do branding right:

  • Dropbox. A vibrant color palette with emphasis on imagery tells the story of their creativity and
  • Wells Fargo. A bank that builds a familiarity and subtle sophistication with its consistent use of that cherry red font and horse-drawn stagecoach. Their slogan “Together, we can go far” is splendid. What other bank trademark can you recall?
  • Parkinson’s Foundation. A logo that resembles a brain inside a head clues everyone immediately on its research around the neurological disorder. They use a bright blue that suggests hope and vibrancy.

Branding may require that you engage with a company that specializes in this field, but it can have a worthwhile return.

  • Brainstorm Your Unique Values. Gather a few team members and have a session to drive out your USP(s). Think about who your perfect customer is, what they really want, and what motivates them to buy from you.

Following are some examples of strengths, benefits, and differentiating qualities that could be the basis for your USP:

  • Lowest Cost
  • Fastest delivery
  • Highest quality
  • Always in stock
  • Dependability
  • Guarantees
  • Speed to market
  • Open 24/7
  • Craftsmanship
  • Unique design features
  • Unparalleled service
  • American-made
  • Handmade
  • Product durability
  • Selling style, glamour, or prestige

While all these ideas and considerations may seem obvious, the truth is that it isn’t easy to come up with that one magic USP. Don’t limit yourself to just one USP; set out to draft at least five.

If your business is in a mature industry or niche, you may have a hard time figuring out what hasn’t already been said or done. Just take a look at your business from different perspectives, or ask someone outside of your business to look at it with fresh eyes.

As soon as you decide on a strong USP, make sure that everyone knows about it. Include it in every ad, message, email, social media post, and landing page. Put it on your business card, flyers, postcards, and brochures. List it on banners and signage. Instruct your entire team to use your USP to compel customers to choose your services and products over your competitors.

Testing Your USP

If you’re undecided on which is the best of your draft USPs, then try these ideas:

  • Create a landing page for each USP, then wait a bit to see which has the highest activity rate.
  • Set up a simple contest with your customers – post a numbered list of your proposed USPs. Have them write down their choice on their business card, which isput in a fishbowl. Hold a drawing after a week or a month, offering them a discount or prize.
  • At your next networking event (or two or three), show a print of your potential USPs to a few attendees and have them pick a favorite. You can thank them for their opinion with a lollipop, pen, or other small giveaway.
  • Post USPs on Survey Monkey, FaceBook, or other forumand wait for the feedback. Don’t be discouraged at the negative comments – unfortunately, it’s the price everyone pays in the incognito world of the internet.
  • Email your employees to request their two cents … and ask them to weigh in with some of their USP suggestions (they might come up with a gem)!

Summary

However you find and define your unique selling proposition, it’s not just about getting more customers in the door. It’s a sure thing that you’ll learn a lot more … about your company’s purpose, direction, products, and services … about your existing and potential clients … and about building a business that has value, character, and long-lasting appeal.

The post What’s Your Unique Selling Proposition? appeared first on Small Business Coach Associates.

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It is extremely important for business owners to have an organizational plan in place. It should delineate not only your organizational structure of departments, managers, and staff, but also the functions, tasks, and processes they regularly execute. Your organizational plan should flow from your strategic plan.

Why bother? Well … here’s what it can do for your business:

  • Clarifies the role and function of each staff member
  • Shows how staff is contributing to the goals of your business
  • Displays managerial and team relationships
  • Can reveal gaps, issues, and liabilities
  • Clarifies the when’s, how’s, and who’s in your processes
  • Makes it quick work to know who to turn to when there is a problem

Everyone working with you needs to be aware of this information.  Post it in a conspicuous place, whether it’s on a bulletin board or your internal website.

Importance of an Organizational Plan

A detailed organizational plan is crucial for every small business. Besides outlining all the tasks, functions, and goals for a department or area, it should also show the assigned responsible person . It is also helpful to have organizational structures that clearly show supervisory relationships as well as the power structures for accountability.

This plan is the best way to simply and distinctly communicate what everyone should be doing and how it relates to the business as a whole.

Creating Your Organizational Plan

If you don’t have an organizational plan, start one now.If you already have an organizational plan, then it’s a good time to verify and update all the necessary information on it.

Following are the steps for creating your own organizational plan.

  • Pick Your Team
  • Draw a Chart Showing Your Organizational Structure
  • Drive Out Goals & Objectives
  • List All Tasks and Functions
  • Review Current Business Processes
  • Compile Findings into Organizational Plan

#1: Drive Out Goals & Objectives

All organizational plans need to include what the business wants to accomplish and how to get there. Clearly state what you want your business to become – which drives out your goal/destination and the objectives/measurements for reaching it.

Common goals include:

  • internal stability> reducing staff turnover, promoting consistency
  • creativity> inspiring innovation, ingenuity, and improvements
  • uniformity> consistent delivery of goods and services; branding
  • security> protecting data of customers, vendors, and the business
  • quality control> focusing on excellence
  • accountability > identifying who’s responsible
  • integrity > transparency, honesty, fairness
  • rapid delivery of goods > improving turnaround
  • excellent customer service> exceeding expectations
  • efficiency > refinements that lead to optimum operations

#2: Pick Your Team

While you may prefer to do everything yourself, it is imperative to engage with others when creating the plan for their knowledge, ideas, and perspectives.

Look at your team and select your key players – that is those staff members:

  • who understand the current systems, processes, values, and goals
  • who can offer worthwhile suggestions for improvements
  • who can visualize and evaluate the effects that changes may have within the business (as changes typically occur during this process)

This team can be reconvened in the future to help with plan implementation.

Note that while most small business owners develop the organizational plan on their own, there may be time, staffing, or deadline constraints that make hiring an outside consultant a better choice.

#3: Review Current Business Processes

Write out each of your processes in detail. Look at what it does and how it does it. Then, list all the functions and tasks it performs as well as who does what. <<Think it would be good to show or list some examples; I did a simple table to see if that might help>>

Process What It Does How it Does it Executed By Functions/Tasks
Paying an Invoice Pays a Service Provider for Services or Products Rendered Through Accounts Payable System Mary Jones Enters billing information in A/P system, which generates & prints a check

This step can be extremely time-consuming and, therefore, is a reason why many small businesses hire a business consultant or business coach.

An often surprising result of this step is you will most likely realize there are differences in how the processes actually work versus how you thought they worked.

#4: List Tasks and Functions

Capture all the tasks and functions that your business is and should be performing. Include those things in your vision that you want the organization to do.

This process should drive out the gaps. You’ll see what is missing: perhaps where your company is lacking key pieces like documentation, training, or analysis. It can also reveal issues and vulnerabilities (ex. insufficient safety practices or improper workarounds).

#5: Draw Out Your Organizational Structure

Now would be a good time to draft an organizational structure chart. This is where you should include all the departments, roles, staff, and reporting structure.

#6: Compile Findings into Organizational Plan

The last step is to gather the collected information into one document.

Share the organizational plan with your entire staff. Might be a good opportunity for a “town hall” or all-staff meeting. Have you implemented an organizational plan in your business? If so what worked for you?

The post Six Steps to Creating a “Must-Have” Organizational Plan appeared first on Small Business Coach Associates.

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A cash gap plan is a relatively simple and very necessary method of managing the flow of money into and out of your business. It’s the only way a business owner can rest easy. You’ll know that you’ll have enough money for payroll, bills, and needed expenditures.

A cash gap is the number of days between paying for goods and services and the payment from your customers.

Cash flow is key to business survival whether your business is growing or struggling.

In any small business, resources (money, inventory, material assets) are scarce. So you want to use them to the fullest advantage. It follows that you need to ensure that your cash gap is as low as possible. You manage what you have against what you are owed. With a low cash gap, you can use the cash to repay debt and to invest in the growth of your business.

There are some well-known companies that actually have a negative cash gap! Think Amazon and Dell Computers. These businesses collect their money before they ship products. The closer you can move your business in that direction, the stronger your business will be.

To maintain a low cash gap, you must set up a plan that’s carefully monitored by your management team.

Essentials for Managing the Cash Gap

Here are four fundamentals which managers can employ to keep the defecit as low as possible.

  1. Monitoring Inventory

One way for managers to keep the cash gap low is to take a closer look at inventory in order to minimize your investment. Let’s say that you have slow-moving items in the warehouse. This could be due to seasonal demand, improvements in materials, or other factors. You can reduce this cost burden by:

  • selling the items for scrap
  • trading them with a competitor or supplier
  • offering a special sale
  • returning them for credit

In addition, managers can review company purchasing policies. For example, they can try to get consignment arrangements in exchange for longer-term contracts.

    2. Speeding Up Receivables

You know that the faster you receive remittance for products and services, the lower the cash gap.

Encourage prompt payments from customers by following up with reminder phone calls, emails, or past-due letters. Before you make a sale, you can offer discounts for early payment. You can also have payment methods like PayPal or Square to ensure a fast turnaround on money owed.

You can also assess if invoice delays are happening due to a lack of communication or processes within the billing, sale, or production staff. Addressing these issues will certainly improve your situation.

  1. Lowering Days in Accounts Receivable

Most small businesses allow their customers to pay within 30 days. While this varies from industry to industry, you can try to lower your payment terms. For example, a manager can offer a small discount if the customer pays within five days.

In the case of international customers or historically slow-paying clients, consider getting a deposit or transfer before you provide a service or manufacture a product.

Managers should continually review accounts for slow-paying customers. If the trend is increasing for this type of customer, consider engaging a collection agency.

  1. Negotiating Better Terms With Your Suppliers

The next way to improve your cash gap is to negotiate better payment terms with your suppliers. Perhaps you can go from paying in 30 days to 45 days. You can inform your suppliers that your customers want longer terms and that you have a cash gap that you need to improve.

  1. Planning Ahead

When you have a small business, it will always be important to plan ahead. Even though you take all the measures possible to avoid problems, you may not lower the cash gap as much as you would like. So, it is always best to have a good cash reserves available just in case you may need to use it.

Summary

A higher cash gap can handicap your business, even to the point of failure. There are several tactics that a company can do to prevent such a gap. You can collect payments from your clients sooner, renegotiate your buying contracts with suppliers, or purge stale inventory.

Be sure to evaluate your plan regularly. This practice will ensure that you’ve covered all the available ways to decrease the likelihood of a cash gap.

Have you tried to implement a cash gap plan? If so, how did it work for you? (Answer below in the comments section)

The post How a Cash Gap Plan Saves You From a Shortfall (and Five Ways to Do One) appeared first on Small Business Coach Associates.

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When you start your own business, it doesn’t take long to realize that there is a lot to learn – like gaining the skills to form strategies, budgets, processes and a marketing plan. Owners have to create a business card, brochures, website, and logo. They have to write a business plan, hire employees, find vendors, and connect with their customers through social media and networking. It is a serious learning curve for most entrepreneurs.

Business owners want to know how to tackle these struggles by getting educated and mentored.  Asking for help can be a hard decision for some, though it’s unquestionably the wisest choice. The faster a business owner gets the essential skills and education, the sooner profits rise and success arrives!

The One Approach to Mastering Business Ownership

I believe there is ONE simple way that a small business owner can attain the necessary skill set to grow and improve their business.

There’s never been a single independent business owner who could expertly perform the multitude of jobs needed to build, launch, and manage a small company – Marketer, Speaker, Graphics Designer, and Website Developer. Each has to be Leader, Interviewer, Project Manager, and Researcher. Each must know Customer Service, Finance, Sales, and Negotiations.

Remember when Hemingway wrote “No man is an island”? Well, he may have been writing about a small business owner, because there’s no one who can successfully do it solo.

It’s All About Coaching

Business coaches can provide the training, mentoring, recommendations, and guidance which help entrepreneurs to learn the skills they need to achieve their desired objectives. They offer a tailored education along with support and accountability.

Coaching can take several forms … and can be over a brief period or a longer term, depending on needs and budget.

  • One-on-One Business Coaching.  Meet with a professional business coach on a regular basis. Gain insights into performance, setting goals or strategy, or whatever is needed. This can be done in person, on the phone, or through meeting apps like Zoom or Skype.
  • One-on-One Personal Business Consulting. Use a consultant who is focused on a narrow area of a business for a short period of time. Let’s say that a business needs software to streamline processes. Just hire a specialist to complete this single task and you’re done.
  • Business Coaching Program. A program is a series of activities with an end goal in mind. In this context, the business coach develops lessons or seminars for the client focusing on a certain area, like marketing. Coaching programs can be a one-time workshop or several teaching modules held over weeks or months. Programs can also be customized or bundled into packages that covers a wide array of topics and skills, regardless of the size, complexity, or age of a company.
  • Group Business CoachingMany issues and needs that business owners face are common. Group coaching can be an affordable and even fun solution. In this format, entrepreneurs can receive standard training modules while participating in a community (usually 5‑10 people) that shares successes, referrals, and lessons learned. Meet weekly online or monthly face-to-face.
  • Mastermind Business Groups. A mastermind group (weekly or monthly) focuses on the sharing of knowledge from other business owners along with a coach. Information shared can be general or specific.

In addition to coaching, all business owners (like doctors and other professionals) should continue to develop their knowledge and skills through self-development:  books, magazines, videos, webinars, seminars, etc.

As you can see, there are many growth and learning options available to small business owners who want to improve themselves and their businesses. Any of these options  can provide much-needed support while giving you a significant return on investment.

Tell us what coaching would most benefit you or your business right now?

The post One Amazing Way to Boost Your Business appeared first on Small Business Coach Associates.

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Understandably, there will be times when financial resources are limited for most small companies. When you need to make singular investments or when production or sales are down, it’s critical to have a plan in place. Do you know your break-even point? You want to keep cash in the bank and the balance sheets on an even keel. Such a strategy is called a break-even plan.

This plan helps you to figure out the tactics to employ such that expenses are covered, using calculations of:

  • fixed costs (ex. payroll, utilities, insurance, debt payments)
  • variable costs per unit of sales (ex. production hours worked)
  • revenue per unit of sales (ex. $10.00 profit for a particular product)

Why Should You Become Aware of Your Numbers?

Whether your business is a start-up or a long-running operation, becoming aware of the numbers related to earnings and expenditures will help you know what to do when a financial shortfall occurs.

When income doesn’t cover costs, owners need to be extra-careful to ensure obligatory expenses like payroll and accounts payable are met.

Business Surprises

Unexpected things happen (like system or machinery outages, weather damage, staff turnover or ramp-up) … at those moments, you may need to do things like temporarily cut fixed costs and increase sales to make up for unforeseen losses or expenditures.

Case in point: A key piece of the production process, a 3-D printer, suddenly stops working. To continue to make sales, the printer must be operational. So, you must either buy a new one or engage an expert to repair it. The out-of-order printer causes immediate losses in income and also the cost of repairs or replacement, which causes a shortfall in cash to pay invoices, debt, and other financial responsibilities.

Knowing the elements that comprise a break-even plan is crucial to  prepare for unanticipated events.

How To Create A Break-Even Plan

First, determine your break-even point; of course, this figure will differ from business to business.

There are two main situations that result in different actions or expected outcomes:

Break-Even Point Is High:
  • In this case, a company is forced to have a broader customer base to ensure more income
  • Spends less time in making a product that all customers like but on a product that most of them won’t dislike
  • With time, this situation leads to the need to decrease price points and margins
  • With the decrease of prices and margins, company owners may have the temptation to increase the break-even point again, creating a vicious cycle.
Break-Even Point Is Low:
  • Owner begins to target smaller and more attractive niches (examples?)
  • Company can provide more value (like better quality or faster turnaround) to the customer since these owners typically know their niche needs
  • By providing more value, the business builds a better brand, which leads to a justifiable increase in prices or margins
  • Over time, higher prices or margins allow for a reduction in break-even point.

Having a low break-even point allows for (1) diversification in a financial lull; (2) more value to customer; (3) stronger branding; and (4) decrease in the break-even point.

Here Are Some Best Practices to Implement a Break Even Plan

Some recommendations and ideas when developing or implementing a break-even plan:

  • When creating a break-even plan, you should ensure that managers have a chance for input or review during development and, say, annually.
  • At a minimum, include the following in the plan:
    • Calculated break-even point
    • A point-in-time plan to cut fixed costs (ex. reduce insurance coverage or carry out temporary layoffs)
    • Suggested approaches to increase sales (ex. coupons or marketing campaigns)
  • If business draws near the break-even point, owners and managers must act immediately to ensure debts can be repaid and there are sufficient funds for payroll, insurance, and other mandatory expenses by one or more of the following choices:
    • Cutting fixed costs as much as possible
    • Implementing a way to increase sales
    • Temporarily increasing prices
    • Attempting to collect unpaid debts or balances
    • Obtaining a short-term loan
  • Avoid the common mistake of just cutting costs and then increasing prices.
  • When implementing break-even plan, ensure that customer service becomes a higher priority in order to maintain customer satisfaction.

Conclusion

A well-considered break-even plan requires some investment of time, thought, and financial facts, but yields a very high return when  a shortfall in cash occurs. Not only can such a plan save a company from financial crisis/ruin and help lower its break-even point, but also can lead to more stability and the opportunity for you to raise prices. Do you have a break-even plan in your business? Do you think it would help you?

The post Why Does Your Business Need A Break-Even Plan? appeared first on Small Business Coach Associates.

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