TGroup Marketing

Simpleology

I'm evaluating a multi-media course on blogging from the folks at Simpleology. For a while, they're letting you snag it for free if you post about it on your blog.

It covers:

• The best blogging techniques.
• How to get traffic to your blog.
• How to turn your blog into money.

I'll let you know what I think once I've had a chance to check it out. Meanwhile, go grab yours while it's still free.

Small business resources

Running a successful business doesn't happen by accident. Building a thriving company requires a great deal of planning and preparation. Two of the most important planning and goal-setting tools are the business plan and the marketing plan. A business plan is a document that describes an organization's current structure and status, where it expects to be several years in the future and how it plans to get there. A marketing plan outlines the implementation of the firm's marketing strategy and includes the specific steps the company will take to reach its target market. Both of these documents can be overwhelming.

There are lots of resources available about how to go about writing business and marketing plans. There are even some nicely designed software programs that can guide you through the process. A number of websites also offer some great free resources about business plans and marketing plans. For business plans, the Small Business Administration (SBA) has a very helpful site to assist in developing a writing a business plan. The SBA site has also got some very useful information and marketing plan development resources that can help you to develop a marketing plan.

Top 100 business blogs

I was checking out the StartupNation.com forums this morning and ran across a post about the top 100 business blogs. They are listed in order of their Technorati and Alexa rankings. The list was compiled by an entrepreneurial Brit named John Crickett. I haven't had a chance to check out all of them but there are definitely some great blogs on the list.

Working out of a home office

I was talking with someone last week who has a great product idea for the mass market. He asked me if it would be necessary for him to invest in setting up an office/warehouse before approaching the big retailers. I told him that no, it wasn't necessary given all of the technologies available today. In fact, it's down-right easy for someone working out of his or her home to appear to outsiders as a much larger business--particularly if you're able to outsource parts of your operation. This has worked really well for one of our companies for almost five years now and we sell our products to Wal-Mart, Walgreens, Kroger and lots of other giant retailers. We're able to do this by outsourcing as much as we can (call center, EDI, manufacturing, warehousing, etc). It's not so much the outside appearance of your company that matters but whether or not you're able to do what you say and fulfill your obligations. Here's a website that's got some great resources for home-based entrepreneurs: HomeOfficeLife.com.

Product launch process

This morning I read that about 45% of all new product launches fail. I think the actual number is probably a lot higher. I'd guess it's probably somewhere between 70% to 90%, depending on the type of company doing the launching. Do a search on "product launch process" and you'll get a million results and lots of different ideas. In a nutshell though, here are some of the basics:

1. Identify the need that you are trying to meet with your product or service. Someone might think that his idea of creating a line of swimsuits for guinea pigs is great, but is there really a need for that?
2. Identify the key features of your product or service that meet the need and learn how to describe how it meets that need. Here's a tip: Keep it brief. Remember that people have short attention spans and if you drone on and on you'll lose them.
3. Identify what sets your product or service apart from the competition. Why should someone choose yours over something else? Again, make sure you can get your point across quickly without wasting time.
4. Identify your customers. Do you have a niche product or service that is going to appeal so a particular segment of the population? Or, do you have something with broad appeal? If it's a product that you've got, think about this in terms of who is going to be the end user (consumer) and who will be selling your product to the consumer. If you have a niche item designed to target a specialized segment of the population, don't waste your time chasing mass marketers.
5. Develop your message. Make sure that your message is brief and to the point, tying your product's benefits to results.
6. If you are launching an actual product that someone can touch and see make sure that you pay close attention to packaging and display. You've only got a split second (if that) to capture the consumer's eye so do it well.
7. Create some buzz before you launch. Send out press releases, media pitches and talk to your local television and radio stations.
8. Develop a marketing strategy (before you launch). How are you going to make people aware of your great product or idea? Unless it's going to jump off the shelf, you'd better have a plan. This is especially true if you want to sell your product to the mass market. If a buyer is interested in what you've got, one of the first questions that he or she asks will be, "What's your marketing strategy and where are you spending your marketing dollars?" If you don't have an answer I can guarantee that your meeting will be very, very short.
9. Before you actually launch your product or service, think about potential obstacles and pitfalls. I'm an optimist but you don't want to be blindsided and left dumbstruck.

There are lots more things to learn but this gives you a basic overview of some of the things that you'll want to consider.

Think long-term

Just about every day I read or hear something that shows that many businesses today are focused on short-term rather than long-term results. With everything about our culture seeming to glorify instant gratification and immediate results, it's no surprise. Short-term thinking (and greed) has been behind some of the biggest corporate scandals we've seen in recent years. Besides just being greedy, these people were focused on doing whatever they could to make the numbers look good for the short-term. For a small business, this can be deadly. Here's a good example:

Several years ago, before one of our companies had its own Wal-Mart vendor number in the mens' department, we partnered with another company that had a couple of open SKUs. We supplied them the goods and they sold them to Wal-Mart on our behalf using their UPCs. We knew going into this that we had a hot item that people were crazy about so we went into it with great expectations. I don't remember exact numbers but I think we booked like 288 units per store in locations throughout the Northeast. We sent the orders over to our partner in the project where they promptly cut all of the orders in half--we were stunned (and angry) but they refused to budge. They shipped all of the revised orders. A couple of weeks later, we reviewed the sales results and saw that most of locations sold everything, with the remainder selling about 75-85% of the goods. The owner of the company told us that he cut the orders in half because he was more concerned about maintaining a good relationship with Wal-Mart than he was about making a quick buck. Had he shipped everything as we sent it, while some of the stores might have still sold nearly everything, other stores would have gotten stuck with a lot of merchandise that would have to be marked down.

He had developed a reputation that he wanted to maintain and protect. They trusted that everything he sold them was going to have a good sell-through and that they would not get stuck with excess merchandise that they'd have to mark-down. He was not going to risk hurting his reputation by possibly overstocking stores with goods. For us, it was disappointing but we also learned a valuable lesson about thinking long-term. When a buyer at Wal-Mart is making a decision about whether or not to renew a vendor agreement with a company, he or she is going to look at how well the firm's goods sell. Companies that have a lousy sell-through with lots of markdowns are going to get cut and those that have a solid track record of selling-through are going to get invited back to do business with Wal-Mart.  Now that one of our companies has its own vendor number with Wal-Mart (and other major retailers), we find ourselves routinely slimming down orders in order to preserve our reputation.

It's tempting to take the quick hit and go for the short dollar, but we've found that this is a dangerous strategy that can come back to haunt you and ultimately, hurt or destroy a business.

Turning your idea into reality

I was interviewed last week by a local television news station here in West Palm Beach. They were interested in learning more about one of our projects that is related to selling "hot market" sports event-related goods to mass merchandisers. The news anchor wanted to know where the idea originated (my business partner's teenage son), who were our first customers (Wal-Mart) and how did we make it happen. I had to think about that one for a minute but finally said that we just made the decision to do it, started moving ahead and before we knew it, it was really happening. He then asked if I had any advice for any would-be entrepreneurs. I replied that, "If you really believe that you can make it happen then you can."

That got me to thinking about the subject of turning ideas into reality. Lots of us have great ideas for new products or services but very few of them actually make it to market. So I did a bit of rooting around and found that these were the most popular tips for making a dream or idea a reality:

• Have a definite goal-be as specific as you can so that you can focus your energy on achieving that goal;
• Make a plan of action-you ought to have an idea of the route that you will take to achieve your goal;
• Keep your focus on the goal(s), not the obstacles that you encounter-focusing on the roadblocks isn't going to do any good so stay focused on what you want to achieve;
• Take risks-to be an entrepreneur you have to be prepared to take some risks: There's no way around it (whether they're baby steps or a giant leap, they're unavoidable);
• Maintain a positive attitude-a defeatist outlook isn't going to help you along the way. Even though it can be extremely (and I do mean extremely) tough sometimes, a positive attitude is indispensible;
• Keep pushing forward-keep plugging along no matter what. Don't let yourself get stuck in an endless rut.

Great Article

I was reading the Advisor Garage blog this morning and found this article that I think is interesting. It's all about choosing the right business partners. I am extremely fortunate in that my business partner and his wife are also my closest friends in the whole world. We've been working together now for more than two decades. We've worked with different people over the years, partnering with them on various projects--sometimes it has gone well and others have been a complete disaster. Anyhoo...here's the article:

Choosing the Right Partners…

OK, so you’re all fired up! You’ve just been hit in the head by a sledgehammer of an idea for a new business and you just can’t stop thinking and talking about it. Friends, family, the dog…everyone has to be subjected to your new, world-shaking idea - you just can’t hold it in. Your passion just overflows…

The idea stays - buzzing around in your head when your not dragged from it by more mundane things like earning a living, studying or whatever else you did before the idea came along and lets face it - everything is more mundane than your idea! Anything that takes time away from thinking about it becomes an aggravation, an annoyance. You wake up in the morning and there it is - poking up at you (Yes - still talking about that idea!).

Anyway - you get the picture. The eureka moment that’s the beginning of a new company is like falling in love and its needs to be - because tough times are ahead and you’ll need that passion and commitment to see it through.

What happens next? If you’re lucky, you’ll start thinking about how to make your idea real. If this is your first start-up you’ll probably be nervous…wow, this is a big step - what if it fails? How will I pay the bills? I have some skills but not all that this is going to need…and then it hits you - you’ll need other people. Hey, if I can convince someone else to do it with me then I’ll be sharing the risk and they’ll be two of us so it’s more likely to succeed right?

The short answer is ‘maybe’.

Choosing the right partner is critical. They need to:

• Bring something to the table
• Be completely comfortable with the risk of being in a start-up
• Want to see this idea become real just a badly as you do but perhaps most important…

They have to work well with you no matter what the situation or pressure. Being in a start-up can be a more intense relationship than marriage! Yes…honestly!If you can’t answer a strong positive to all of the above then this may not be the right partner and don’t think it doesn’t matter - it does.Being in a start-up, especially during the early days is daily challenges and pressure - its true that its probably the most enjoyable ‘career’ you can have (at least I think so!) but if you choose the wrong partner then it soon becomes a nightmare for everyone. Don’t make the mistake of choosing to pursue a start-up with someone because somehow it’s more reassuring to have someone in there trying to make it happen with you. That’s just not a good enough reason.

As founder’s you will have to deal with all kinds of pressures, not least of which is:

• Who is the ‘face’ of the company?
• Who makes the key decisions after all the discussions and debates have come to an end?

…basically, where does the buck stop?

Two people trying to be joint CEO is often a recipe for not making decisions and for getting stuck in the quagmire of all talk and no action. Entrepreneurialism IS action because the clock is ticking - every day is more money spent until revenue, is another day closer to when your competitors notice you or the market you’re pursuing…there’s only so much gas in the tank so speed is everything.

That’s not to say two CEOs can’t work but what usually happens is they divide the territory - each owning a set of responsibilities and deliverables - clear areas where one person calls the shots after the debates have ended.One last thing - even founders should have shares in the company which they have to EARN over time based on their initial and ongoing contribution. Coming up with an idea or being the second or third person to walk through the door is not a good enough reason to instantly own a big chunk of the company. If the first few in instantly own a big chunk then they can effectively disappear or not contribute and still get just as much equity as the other founders. Not fair! Everyone has to earn it every day - that way everyone contributes and keeps contributing all the way through until the business becomes more than just an idea…until it lives and breaths…and with enough passion and perseverance - it will, just like http://www.AdvisorGarage.com

“Copyright © 2007, Andrew D. Ive, Advisor Garage.

A great resource

The Small Biz Survival blog is an excellent small business resource. Their focus is on small businesses in small and rural towns. It's a well-organized site with tons of useful information, small business tools, podcasts and resources. Be sure to check it out, you'll be glad you did.

Small business failure rates

There have been lots of studies of small business failure rates over the last 30 years or so but from what I've seen, the results have been either contradictory or very vague. I remember reading somewhere once that more than 90-95% of small businesses fail within the first five years, but they didn't have any real data to back up the claim. The latest statistics from the Small Business Administration (SBA) though, show that "two-thirds of new employer establishments survive at lease two years, and 44 percent survive at least four years."

Brian Head, Economist with the SBA Office of Advocacy, noted that the latest statistics are a much more accurate assessment of new business success rates, and that "as a general rule of thumb, new employer businesses have a 50/50 chance of surviving for five years or more."

Now those numbers are a lot more encouraging than some of the stuff I've seen in the past. Although from the number of new business startups every year, the unsubstantiated claims of 90-95% failure rate didn't seem to deter very many folks from going into business for themselves. Even if those numbers were true, I doubt that it would stop many people because for a lot of us, it's in our nature to think, "Oh, that will never happen to me. I'm smarter than that."