Do Not Dump One Line of Business to Grow Another One

Posted by: on January 15

The death knell of growth comes when you decide that a line of business is too much work for you to keep. Do not dump any line of business unless it is losing money and there is no way to adjust costs, or no other sales channel available to you to profitably sell those goods or services. Before you do anything drastic, perform what-if scenarios and make sure that you do not need any heroic change in other lines of business to survive.

I know of a company that dropped an old line of business on the assumption that the new line of business would grow at a 500% annual rate. It did not grow that much, and over time its growth declined to a modest 25% annually. As you adjust to meet the needs of today's economy, adjust proportionately and avoid sweeping changes that can severely hurt your business.

Marilyn Holt
CEO
Holt Capital
Seattle

Take Advantage of Bargains from Businesses in Trouble

Posted by: on January 14

If you have the cash and warehousing space to take advantage of bargains from distressed or failed businesses, now is the time to do so. Do not hesitate to ask for a lower price, or ask for more at the same price. Cash speaks in a very loud voice, so use it if you can. However, remember that unless you know who will buy an item and how you will sell it, it is not a bargain—it is junk.

Marilyn Holt
CEO
Holt Capital
Seattle

Making Up for a Slowdown in Premium Goods Sales

Posted by: on January 13

Premium pricing is bringing down retail giants. If you're a small retail store dependent on premium goods, track your premium-priced products and innovate on how you package and sell these goods. Adding less expensive items in a similar quality range may help make up for a slowdown on premium goods sales, while still continuing to attract high-end customers. It will also be important for you to innovate as you never have before—a process that may start by quickly setting up a focus group of your target customers, and then listening to what they have to say.

Marilyn Holt
CEO
Holt Capital
Seattle

Don't Fear Online Customer Reviews

Posted by: on January 12

Online ratings and consumer reviews have become an important element of many people's purchasing process. Customers increasingly rely on online word-of-mouth in making everyday buying decisions. While small business owners often fear reviews on social networks may harm their business, social media actually offers a tremendous opportunity for open communication with customers.

Those who use online ratings and reviews in making buying decisions are savvy consumers. They are able to weigh the importance of many positive reviews against one or two negative ones. So don't panic if someone writes about how your restaurant served them a steak that even your dog would send back, or that their three-year-old gives better pedicures than your day spa. Reach out to those who have had a bad experience and ask for a second chance to prove to them that their experience was not up to your high standards.

More importantly, rather than taking a reactive approach to ratings and reviews, be an active participant in the online consumer dialogue. Encourage your customers to review your business. The more positive comments prospective customers read about your business, the less influence any negative reviews will have.

Do not ignore what is being said about your company online. Engage in proactive online reputation management. You will discover that your customer relationships will grow stronger, helping sustain your business, even during uncertain economic times.

Josh Walker
CEO
CityVoter, Inc.
Cambridge, MA

Sweat the Small Stuff to Drive Revenue

Posted by: on January 09

As with many absolutely valid aphorisms, "Don't sweat the small stuff" makes perfect sense in one context and yet is completely wrong in another. The expression is usually followed by how to keep your cool in stressful situations, or how to focus on the really important things in life—like family and relationships, goals, and priorities. I agree. I'm a believer.

However, in the context of the service provider experience, it is actually the "small stuff" that separates the winners from the losers. It is mistakes with the small stuff that the customer uses to make future purchasing decisions. If my towels aren't fresh smelling, or the fish is greasy, or the remote control battery for my TV is dead, then I don't really care how great your hotel's branding is, how memorable your advertising, or how attractive your décor.

In fact, I would argue that great service brands are born in the boring everyday details. You may have heard the old marketing adage "Don't sell the steak, sell the sizzle." I don't buy that. Sure, there is the occasional branding success, where marketing sizzle creates the opening for operations steak. But in 99% of cases, it's the other way around; the steak comes before the sizzle. The service you provide must be darn close to perfect, or I won't believe any of the hype you shovel me.

I've given a lot of thought to why so many service providers fall short on executing the details, and I'm convinced that far and away the No. 1 reason is that focusing on them is just not as interesting as working on new ideas, new strategies, etc. But after 25 years of listening to service industry customers on this subject, I've found that, with the exception of a few specialized boutique brands, the majority of consumers are looking for consistency and dependability from their service brands. Most don't want the sizzle, they just want the performance. To deliver, pay attention to the daily execution of the details!

Richard D. Hanks
President
Mindshare Technologies
Salt Lake City

Recent Posts

Increase Market Share with Better Customer Service

Posted by: on January 08

If you lead any kind of service business, the conditions are ripe for you to be the next big winner emerging from the current economic stall. Here's how: 1. Think...

Repackage Your Services for Smaller Wallets

Posted by: on January 07

Everyone from cleaning services to high-end consultants needs to repackage their services to keep cost-conscious clients. To do this, focus on essentials. How do you know what is vital to...

Get the Most out of Vendor Financing

Posted by: on January 06

Know that vendors can sometimes play a significant role in financing a new business. Partners in one startup persuaded vendors to give them "net-30" terms in order to stock a...

Where to Search for Funding Now

Posted by: on January 05

If your small business is in need of funding, be sure to think outside the box when it comes to locating funds. You might start by contacting your state, county,...

Finding and Keeping a Bank

Posted by: on January 02

Small business banking doesn't have to be a daunting. Here are five tips to help ensure that finding and keeping a bank is a smooth process: • Understand the basics....

Approaching Your Bank

Posted by: on January 01

Here are five items to consider before you approach your bank for financing: • Understand that your primary responsibility is the proper use of capital and that you are in...

 

About

Want to improve the way you run your business? Entrepreneurs, academics, and consultants from diverse industries offer practical advice on a variety of topics each business day

Recent Comments

BW Mall - Sponsored Links