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Small Business Success Index 4

Index Score*   Grade
73 marginal
Capital Access 67
Marketing & Innovation 65
Workforce 76
Customer Service 88
Computer Technology 73
Compliance 92
*Index score is calculated on a 1-100 scale.
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Should You Encourage Your Employees to Use Social Media?

November 26th, 2010 :: Thursday Bram

As a small business owner, you are responsible for how your employees spend their time at work. After all, you have to pay them, whether they’re doing something to help your business or just twiddling their thumbs. That means that you have to decide whether or not you want your employees using social media at work.

You can’t, of course, decide whether or not your employees can use social media at home — at best you can support them in the endeavor if you approve of the idea of having them use social media, or you can request that they don’t discuss your company if you’d prefer your employees not use social media.

Should Your Employees Use Social Media?

The big question on the table in many companies is how valuable social media is — or might be. Many small businesses have experienced incredible growth as a result of their social media efforts. Others have found that social media just burns through resources, without providing an equivalent return on investment. It’s difficult to tell where your business will fall until you’ve actually had a chance to try out different social media strategies.

If you do have an employee who is interested in social media, you may have an opportunity to move faster with your online marketing efforts than if you were relying entirely on yourself to handle the work. There can be a clear benefit to having employees who are socially savvy.

However, if you have an employee acting as your business’ main face online, you should be prepared for other businesses to make an effort to recruit that particular employee. As he or she builds up your business’ social media presence, an employee can easily build up his or her own online presence. That’s the price of working with a social media-savvy employee.

Keeping Your Employees in the Comfort Zone

The worst social media nightmare is that a none-too-bright employee will broadcast something unpleasant about your company to the world — and that’s a risk you will essentially be running if your employees are active in social media. But it’s also a risk you run if your employees aren’t active in social media in the office, but they are at home. It’s not a problem that will go away by ignoring it. Rather, the best step you can take is to invest in training for your team to help them use social media effectively.

It’s impossible to keep your employees entirely away from social media. Whether or not you have a social media plan in place in your business, you have to be aware of that fact. It’s impossible to control social media — but you can preempt it with positive campaigns, rather than waiting for something negative to happen. Otherwise, your only option is to prepare a response to that inevitable day when an employee posts something like a choice photo from the company holiday party to Facebook.

Image by Flickr user Jason Pratt (Creative Commons)

The Ethics of Outsourcing

November 24th, 2010 :: Thursday Bram

These days, you can outsource anything. You can have a virtual assistant in India checking your phones, a call center in the Philippines handling your customer service and a manufacturer in China creating your product. But there are some ethical questions that go along with the decision to outsource your business’ tasks. Those questions won’t stop you from outsourcing, but they may cause you to think about what you’re outsourcing and how.

Am I Being Fair to My Employees?

If you’ve been working with certain employees for the long term and plan to fire them once you outsource the tasks they currently handle, it’s worth thinking about what that will mean for your employees. You have no obligation to keep on an employee if you find an outsourcing opportunity, but if you have a great working relationship with your employees, simply letting them go can be an uncomfortable prospect. Take a look at the situation and see if there are other opportunities, like offering them some of the tasks that simply can’t be outsourced.

You might also think about your new employees. You might find an outsourcing company that swears $1.50 is a fair wage overseas, but it’s important to look into that for yourself and decide if you’ll really get the value you need from an employee paid at that rate. You may find that not all local organizations are comfortable with the idea that you might be paying such a low rate for your labor, and you’ll need to be able to assure them that you’re paying a fair wage if you want to work with them in the future.

Am I Providing the Best Value to My Customers?

It may sound well and good to hand your customer service off to someone else, but that can easily mean that the first person a new customer interacts with doesn’t speak English as a first language. That’s not necessarily as helpful for your customers as you might hope, and it can make for a less than ideal experience for customers whom you would like to continue selling to. The same goes for manufacturing and other parts of your business you might outsource. You want to be sure that your customers are continuing to get the value they expect from your business if you outsource any part of your company.

If you can’t guarantee that value, that might be a stopping point for your outsourcing plans. You may have a lower margin of profit using local labor or doing something yourself, but you might have lower profits entirely if you can’t keep your customers happy. The changeover just may not be worth it for a small business.

Image by Flickr user Marc Smith (Creative Commons)

A Good Business Owns Its IP

November 23rd, 2010 :: Thursday Bram

Intellectual property is rapidly becoming one of the most valuable assets many businesses have. Think about a company like Google, built entirely on computer code and other intellectual property that the business has developed. It’s not just a matter of what big businesses create, either. Smaller businesses have plenty of intellectual property of their own. From proprietary processes to the logo on your business card, intellectual property is what sets businesses apart.

That’s why it’s so astounding that there are businesses out there that don’t own any of what might otherwise be considered their intellectual property. There are companies that rely on others’ intellectual property to function. That might mean paying for access to the processes that your employees follow for day to day work or it may mean that a graphic designer is the actual owner of your logo and other promotional materials.

The Question of Ownership

In many cases, intellectual property comes with a hefty price tag. Something that can sound relatively simple — like developing your own process to complete a given project — can be surprisingly expensive, as well as require a sizable investment of time. But that cost is upfront. It’s the difference between buying office space and paying rent. While there’s a big price that goes along with buying property, for many types of businesses that plan to be in the same spot year after year, the actual total cost is much lower.

But while buying property may be out of reach for many small businesses, making sure you own your intellectual property is much closer. The main reason that most businesses choose, for instance, to only pay for their immediate graphic design needs is that the cost for the finished product is lower than the cost of getting all of the files involved, including an editable version of your logo. The price difference can be huge and if you aren’t able to edit your projects for the future yourself, it may seem pointless.

Legalities and Price

If your contract with your graphic designer says that the designer retains ownership of the ads and other intellectual property related to your business’ marketing, you may be in trouble if you want to take an ad created for a print publication and put it online. There are other legal problems that can pop up, depending on the intellectual property involved. By paying more at the start, you can avoid the legal fees that could go along with a problem later on, as well as put yourself in a position where you simply can use your intellectual property any way you choose.

If you have any concerns about your intellectual property (or who owns the intellectual property you routinely use), consulting with a legal professional who specializes in intellectual property should be your first stop.

Image by Flickr User Horia Varlan (Creative Commons)

DISCLAIMER: The information posted in this blog is provided for informational purposes. Legal information is not the same as legal advice — the application of law to an individual’s specific circumstances. The information presented here is not to be construed as legal or tax advice. Network Solutions recommends that you consult an attorney or tax consultant if you want professional assurance that the information posted, and your interpretation of it, is appropriate to your particular business.

The Art of Firing a Client

November 19th, 2010 :: Thursday Bram

There are times when you simply can’t continue working with a given client. It’s a fact of business. But there are good ways and bad ways to stop working with a client, just like there are good and bad ways to fire an employee. There’s something of an art to firing a client, with different steps you may want to consider, based on the specific situations.

Leave ‘Em With Good Memories

Whenever possible, you want a client to recall you fondly — to be willing to give a great recommendation if someone asks about you. Good memories are not mutually exclusive with firing a client, as long as you approach the situation correctly.

Often, it’s a matter of framing the end of your time together correctly: if you tell a client that he drives you crazy, he’ll be less enthusiastic about you later on. But if you show that perhaps you’re not the best fit for a client, recommend another company and explain that you’re willing to give up that client’s payments in order to make sure he has the best fit, a past client is likely to think of you more fondly.

Before you suggest that this client really is driving you crazy, think of things this way: Even for crazy clients, there are people who enjoy working with them. There are professionals that thrive on clients who are constantly changing and similar situations. You may even be able to think of someone that you’re nominally competing with who would be glad of the business. Refer your soon-to-be-ex client over, and everyone wins. In many cases, clients will even be willing to end a contract early if you handle the situation gracefully.

Get What You’ve Got Coming to You

Unfortunately, you may have a client you no longer want to work with who makes it hard for you to refer them elsewhere and focus on landing new business. More often than note, these are clients that owe you money. If there’s an unpaid invoice on the books, you don’t necessarily want to cut the client loose until you’ve gotten paid.

Starting out slow is generally a good idea when handling collections — polite letters requesting payment and so on. If the situation escalates, your client will probably realize that you won’t be doing any business together in the future. You may be surprised, though: I’ve had to start collections proceedings against a client who then came back excited to start work on a new project.

There are situations when firing a client gracefully can’t be a priority. If there is truly a problem, such as missing payments, that has to take priority over ensuring that a past client will have good things to say about you. There is value in being known as a business owner who doesn’t let clients take advantage of her, as well as a nice person.

Image by Flickr User Lara604 (Creative Commons)

Review: Successful Blogging in 12 Simple Steps

November 18th, 2010 :: Thursday Bram

As a small business owner, blogging can be problematic. There are plenty of reasons why it can be useful for a small business, like improving your ranking in search engine results. But it can also be a lot of work. Even if actually writing posts isn’t an issue for your business, you still have to find time to learn about the blogging process. The learning curve can be speeded up with a resource like Successful Blogging in 12 Simple Steps.

Annabel Candy, the author of Successful Blogging, comes from a small business background and has created the guide that small business owners need to be able to dive into blogging and succeed.

Blogging By Numbers

Candy breaks down the blogging process into a manageable process of 12 steps, ranging from defining the topic of your blog to creating a guest posting strategy. Those are big steps, admittedly, but each step is organized in such a way as to make it easy to take action.

When defining your topic, for instance, Candy highlights the considerations the owner of a brand new blog must take into account. She includes resources for further research, but doesn’t get bogged down in too much information. Candy provides enough information to let you take action and follows that information up with action steps and a worksheet that will allow you to get everything straight quickly.

Avoid Information Overload

Successful Blogging in 12 Simple Steps clocks in at 65 pages. When you consider that there are plenty of blogging books topping out over 200 or 300 hundred pages, that can seem a little thin. But that length is something that Candy worked hard to achieve. The average small business owner doesn’t have a week to sit down with a blogging guide and slowly read through it. Sorting through the information that isn’t actually necessary for the type of blog you’re hoping to run just makes matters worse. So Candy skipped all the material that you don’t need. This ebook is something that you can read quickly and take action on immediately. There’s nothing to get in the way of creating and running a blog.

Candy offers Successful Blogging with several options to make sure that buyers get exactly what they need. The ‘Hot’ version is priced at $29 and includes an additional chapter on motivation. The ‘Super Hot’ version adds in an audiobook version, as well as blog case studies, for $39. Candy also offers the ebook packaged with a consulting session to work through questions specific to your business and your blog for $499. The variety of options makes it easy to get as much help as you need for your blog — and not pay for more.

Photo Courtesy Annabel Candy

How Much Is Too Much to Pay for a Marketing Tool?

November 16th, 2010 :: Thursday Bram

For some small business owners, it’s impossible to pay too much for marketing, provided that the marketing in question brings in at least a little more than you spent in the first place. For other companies, even spending a little more than a set percentage of their budget on marketing is out of the question.

For both of these viewpoints, the many new marketing tools that keep appearing on the scene can be a problem. There is software to help with social media, tools that will show you wherever your business is mentioned online, and so on — all of which can help you market your business. Some are free, some come with sizable price tags, and all of them require deciding how much you’re willing to invest in a marketing tool.

Costs Beyond Money

With a new marketing tool come costs far beyond what you pay to use it. You may need to pay a specialist to handle using the tool in question or to train you so you can manage it. You need to spend time on using the tool, which can easily take time away from other, revenue-producing work. Before you decide if paying for the use of a tool will help you with your marketing, you need to know what it will actually cost you to use. Take that a step further and determine what it will cost you on a monthly basis — many Web-based applications are priced as a monthly subscription, rather than one initial payment.

Once you’ve actually got some numbers in place that you can work with, you’ll be in a far better place to make the financial decision on any given tool.

The Marketing Decision

There’s a difference between the financial decision and the marketing decision, though. A business owner has to balance the marketing needs and the financial needs of the business. Depending on the business owner’s background, it may be harder to see the immediate usefulness of a given marketing tool. For that reason, it can be important to have someone in your business — whether a regular employee or a consultant brought in specially — who can make an effective argument for the different marketing tools you may be considering.

A marketing professional may be able to offer a more in-depth comparison of the different tools that are out there, going beyond what a couple of minutes of Internet research can turn up. There may be reasons for price differences between products that many not be immediately obvious, especially for a business owner who must focus more on management and operations.

There are other reasons to bring in a marketing specialist as early in the conversation as possible. When you’re trying to figure out your true costs for a tool, your marketing specialist is either going to be using the tool or training you to use it. That means his or her recommendation should carry weight, unless you also want to pay for the time that it takes that marketing pro to learn a new tool.

Image by Flickr User House Of Sims (Creative Commons)

Now is the Right Times to Spend on Online Technology according to SBSI Report

September 30th, 2010 :: Thursday Bram

Small business owners are routinely confronted with a difficult decision: when is the right time to spend money on the business. The question becomes significantly more complex when you’re considering spending that money on online technology. It’s evolving quickly — what is cutting-edge for your industry today may be obsolete next week. Despite these concerns, however, making the investment in the right tools for your company is necessary.

In the survey that resulted in the most recent Small Business Success Index, small business owners reported lower levels of spending on online technology. While there’s still plenty of spending on social media — adoption rates held steady at 24 percent — adoption of other technologies dropped. That includes technologies ranging from websites to online advertising.

Getting Ahead of the Game

If your key competitors are small businesses, this information means that there is an opportunity to get ahead of them with some carefully considered investments into your business’ online technology. The best opportunities depend on your industry: if you’re in a particularly tech-heavy field, you may need to be moving towards the latest and greatest social media opportunities. A particularly heavy investment may not be so important if you’re in an industry where your competition is slow to adopt new technology. Many individual professionals, for instance, have been slower to roll out new websites and other online marketing efforts, creating a gap where you can move forward if you’re willing to put some money into the online technologies that will help you reach out to new customers or even manage your business more effectively.

The difficult consideration is choosing where to invest your time and money. If you’re planning to handle each step internally, it can take time for you or one of your employees to get up to speed on the fast moving developments among website tools and the like. Simply for the sake of efficiency, it may be worth focusing your initial spending on tools or consultants that can bring you up to speed quickly. It’s perfectly possible for a small business to build its own online technology, but it is often at the cost of taking away from your core competencies.

Focus Energy on the Big Wins

When it comes to online technology, there will always be low-hanging fruit: something as simple as building a basic website can transform your business if you haven’t already done so. Similarly, there are ways to get the most bang for your buck with social media or SEO. By going after the big wins first, you’ll get significant benefits. The opposite approach — doing each step perfectly and optimizing it as much as possible before moving on — will get you the maximum benefit, but only over a longer time frame. By looking for the biggest changes you can make, you can start reaping the benefits fast enough that you’ll be able to easily spend time and money on the smaller tweaks later on.

That approach can extend beyond marketing technologies. There are many online technologies that can help with other facets of your business, although the marketing tools often offer the biggest upfront wins. New inventory systems, bookkeeping tools and other technologies are also worth investigating.

Image by Flickr user Michael Surran

Working Abroad: What It Takes and When It Makes Sense

September 28th, 2010 :: Thursday Bram

Interest in telecommuting is growing — and not just for employees. Many business owners are exploring opportunities to make their companies virtual, so that they can travel or move easily. The specific form such a change can take varies, but for small business owners with goals simply beyond growing a business, heading abroad can certainly make sense. Thinking globally can have benefits beyond the personal for a small business owner, as well. Only 7 percent of small businesses do most of their business globally, according to the Small Business Success Index, but there are huge opportunities.

Making the Choice to Go Virtual

You may have worked on the assumption that you have to go into the office every day for years, but the real truth is that most office-based businesses can easily be made virtual. Even many stores can be converted to online-only operations with surprisingly few problems. The only businesses that don’t offer the possibility of going online are those that require a physical presence — a mechanic can’t usually convince a customer to ship a car overseas to be repaired and a doctor probably needs to see his patients during the diagnosis process. It’s worth noting, though, that the administrative processes for such businesses could probably be virtual.

But there’s more to the decision to go virtual than just the option to do so. Not everyone is comfortable working from wherever they happen to be: some people need the environment of an office. That means that, before you decide to take your office entirely online, it’s important to actually test how you and your employees work without the structure of an office environment. Similarly, you’ll need to test tools to see what you’ll need to be able to manage each part of your business.

What Your Business Will Need

A virtual business still requires a mailing address and some other physical aspects of a company. However, those needs don’t have to tie down the company. They can amount to something as simple as a post office box that someone associated with the company checks once a week. There are even companies that do little more than accept mail and scan it for the actual recipients. You’ll also need a computer and an internet connection no matter where you are, which can often amount to a laptop and some sort of wireless access point. Beyond those basic necessities, you’ll need to look at the specifics of your business and your industry.

Many of the software tools needed to operate an office now have web-based counterparts, allowing you and a distributed team to stay up to date with each other from around the world (provided, of course, that everyone involved has a decent internet connection). That includes project management, bookkeeping and even industry-specific tools. It’s a matter of exploring what is available.

Image by Flickr user Tom Godber

Turning Around the Small Business Workforce

September 23rd, 2010 :: Thursday Bram

The past few years have been tough on small business owners working to build the workforces necessary to growing a company. Rising costs of employment, paired with a down economy, have simply reduced the resources most business owners have available to invest in a workforce. In the most recent Small Business Success Index, many small business owners pointed to less success in training and developing employees — 58 percent consider themselves highly successful, down from 65 percent a year ago.

Creating the right team is crucial to a small business and has long made small businesses competitive as employers: employees at smaller companies tend to get more opportunities for development, more responsibilities and even more opportunities to increase their own income. But many small business owners report struggling with workforce issues right now.

Making the Most of an Improving Economy

Most small businesses are seeing their financial situation improving. That means an end to at least some cost-saving measures and perhaps an increase in hiring. It’s time to take a look at how you can improve your existing team and where you need to consider hiring more help. Your employees are about to have a lot more options in terms of employers and you’ve got to make sure that they have reasons to stick with you.

Just as one of the best strategies to manage your workforce during economic downturns is to talk to your employees and make sure that they’re kept up to date on what’s going on, it’s good practice to talk to them during good times as well. If you’re thinking about how you can improve things for your team — as well as how to develop them into a better workforce — check in with them and see if there’s any requests on the table. You may be surprised: an employee may be more interested in increased responsibilities or help furthering his education than a bigger benefits package. There are plenty of ways to help both you and your employees move forward and they may have some suggestions in that direction.

Avoiding Workforce Problems

If you feel that your business may be one of those that isn’t having as much success as in years past, it may be particularly crucial to look for solutions. For the past few years, most employees have been reluctant to try to leave their current employers — after all, there was no guarantee that they could easily find a new job. There are still elements of a jobless recovery right now, but the overall economic situation is headed in a direction where many employees will feel better able to replace an unsatisfactory job.

As a small business owner, it is necessary to make sure that trained, valuable employees have little incentive to start job hunting. The shape your efforts will take depend on your industry, as well as the needs and expectations of your employees.

Image by Flickr user Bill Jacobus

Turning to a Global Workforce Creates More Small Business Opportunities

September 21st, 2010 :: Thursday Bram

At the end of the day, your workforce decides whether your business succeeds. You need good people at a price that leaves room for a return in your business. But the cost of hiring keeps going up, making it difficult to bring in the people that will really make a difference as your business grows. One option may be to consider a more global workforce.

In every business, there are plenty of tasks that don’t need to be done in your office. The number of tasks that can be handled off site keeps growing, as well: if you’ve got a few key pieces of technology, anything from bookkeeping to marketing can be done away from your office. That opens up the possibility of working with a remote team. Just who is on your team can also vary: it’s no almost as easy to hire a virtual worker in the Philippines or in India as it is to hire an employee who lives down the street from you.

Changing the Cost Question

There is one key factor when it comes to working with a global workforce, rather than a local one: cost. The monthly income for most jobs in the Philippines is under $500 (U.S. dollars) — an engineer might expect to earn a little over $400 while a receptionist would be closer to $150. There are other reasons that your overall costs would be less when working with a distributed team: you wouldn’t need to pay for office space for those team members located outside of your geographic area. It may take some investment in terms of hardware or software to make sure that your team can work well, but internet access and even computer ownership is becoming fairly common in most countries (at least in the bigger cities). A global workforce presents an opportunity for most businesses.

Considering Your Own Business

It can take some careful consideration to determine just what jobs in your company don’t need to be done in the office. There are also personal considerations: you may simply have a preference to have your bookkeeping done locally or something similar (although you might consider the opportunities available by choosing a bookkeeper who is local but also doesn’t come into the office. You may need to check out what tools and technologies are available for your industry — many fields now have specialized tools to make telecommuting and distributed workforces easier to manage.

In the most recent Small Business Success Index, many business owners reported less successes in training and developing employees, although there were moderate successes in improving employee productivity and rewarding employees. Turning to a global workforce can create more opportunities for small businesses to expand workforces and create better working environments, if only because of the relative costs involved in looking for new employees outside of the country.