Business Development. Small Business

Small Business, the Backbone of US Economy, could always use help

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In a recent commentary in the Wall Street Journal, by Harvard Business School dean Nitin Nohria, titled ” Appreciating the Big Role of Small Businesses” http://www.wsj.com/articles/appreciating-the-big-role-of-small-businesses-1472855429 a great point is made that should be the focus of many small business owners. The article pointed out that Harvard Business School now has a class dedicated to teaching “Financial Management of Smaller Firms.” MBA students are taught how to seek out, purchase and run small businesses. The thrust of the article is that while many, or most, small businesses are run by owners, incapable of growing their business, a young energetic MBA can bring new ideas and innovation into the market place. Dean Nohria does state correctly that business schools have not spent a lot of time  doing case studies of small businesses because they are not considered dynamic and most MBA grads want to work for a large corporation. The great point is, however, that you do not need to sell your business to a young MBA in order for it to grow.

It has been pointed out many times that Small Business is the engine that runs America’s economy. The problem with many is, which Harvard would find out if they did case studies, the owners of small businesses spend most of their time managing and keeping the business going. This leaves little time to learn the new and innovative ideas coming out of the idea factories. The choice trying to keep up with all the new information, running the business and having time for a personal life. while some will look to bring in a consultant of business coach most assume this is not an option because of the expense.

Today business consulting has become as specialized as many professions. There are Marketing consultants, Financial consultants, Information consultants, and a number of others.  What most small businesses need is a general practitioner, some one who can analyze the business and look for the most common solution, or see a deeper problem and suggest a specialists.

Another area that confounds and confuses the small business owner is the increasing number of government regulations. One of those regulations comes into effect on December 1st and is known as the new overtime or final rule. The impact on small businesses will be one I do not think the government has taken into full account http://smallbiztrends.com/2016/06/new-overtime-rules-2016.html the rule increases the level of salary at which the employer must pay overtime.

Key Provisions of the Final Rule

The Final Rule focuses primarily on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt. Specifically, the Final Rule:

  1. Sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South ($913 per week; $47,476 annually for a full-year worker);
  2. Sets the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally ($134,004); and
  3. Establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

Additionally, the Final Rule amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.

In other words the small business owner must decide to:

  1. Increase the salary of those fulltime employees who will be eligible for  overtime, which may not be financially advisable.
  2. decrease the hours of those employees so they do not exceed 40 hours or are no longer fulltime, decreasing productivity.
  3. Reducing the number of employees and allowing those remaining to work overtime to make-up the difference.

The next rule to impact business comes into partial effect in April of 2017 and full effect in January 2018. The Labor Department’s fiduciary rule is aimed at stopping financial advisors from putting their interest before those of their clients in regards to retirement accounts. While in theory this is a wonderful idea in practice it may have the effect of stopping small businesses from getting needed advice, as their financial advisors will be loth to give good advice lest they be fined, and fined heavily.

JANUSThink was founded on the philosophy that it is better to give back to the business community then to watch small businesses flounder and die. There is a better way to bring process improvement into your business then selling to, or bringing on full time, an MBA from one of the nations excellent business schools, bring in a consultant with knowledge and experience to help you move to the next level, even if that level is keeping the doors open.

JANUSThink’s payment schedule is designed to help any business get were they need to go. As a general practitioner we cover a wide area of knowledge and have partnership arrangements with those specialist that can assist as needed.

Please contact us for a free initial consultation.

 

 

Is Your Business Ready for the New Market

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Location, Location, Location

 

 

How often have we heard the old real estate adage that the three most important things in real estate are location, location, location. This adage can be used in business as well, and not just for the location of a brick and mortar store location, although that works as well, but in all aspect of marketing and branding. In today’s competitive markets location is defined as how well you are represented on social media sites and the location on these. A newer saying goes something like this “where is the best place to hide a dead body, on the second page of Google, no one will ever find it.”

If you have a marketing plan how old is it and when was the last time it was reviewed and updated? If you do not have a plan, try reading Marketing and Branding. The need to have an effective marketing effort is more important today than ever. What dominated marketing trends in 2015 were, among many things. “less is more marketing”, “personalization”, “multi-cultural marketing”, and “content.” What is trending in 2016 is audience “connection.” In other words, bonding with your customer. You need to create a customer experience. Much of this can be achieved through Video and Imagery Explosion. According to Forbes 80% of global internet traffic will be video by 2019. This does not mean just showing exploding cars, content remains king, it’s how you present your content that counts and to whom. Multi-Cultural Marketing is taking over generic marketing. In the United States 93% of the population growth is multi-cultural. Let us not forget that growing market segment “MILLENNIALS.” While there is wide discussion as to what a millennial is, the consensus is those born between 1977 to 1995.

Since millennials will outnumber baby boomers by 22 million by the year 2030 it not too soon to work on that marketing plan. Millennial’s look at life a little different then past generation. They look for authenticity and look for a more personal experience than their parents. They do much of their shopping on line and discuss openly all aspects of their life on social media.

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It is important for today’s business owner to understand the ever-changing face of this new way of marketing and branding. Search Engine Optimization (SEO) is the new king of getting the message out. Do you have the right key words to attract the spiders as they respond to the customers (or potential customers) search? Do you understand buyer persona? Customer service is still in paly but is now headed as great customer experience. Are you prepared to provide a great customer experience with your online sales platforms? Waiting line theory is still used but now you must keep your customer online not just inline. Ask yourself how often you have had a bad experience while trying to make a purchase on line. How often have you wanted to contact a company but could not find a way to do it other than through email or an online chat. If you did find a number how long where you on hold. How often can you hear the same “we are experiencing unusually high call volume”. Your current customers have little patience for this and the new up and coming customer just don’t bother. If your competitors make it easier your customer will not come back.

This article is just an idea. I would like to thank Melina Sigal of The Sales and Marketing Connection for supply a lot of the information used here.  At JANUSThink we can help you with your marketing. Just give us a call at 703-314-2964 or contact us through our website at janusthink.com

Business Plan

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Let’s discuss the need for a business plan. The two major problems that many small business owners run into with business plans is that they will put one together for a back loan and then forget it, or never formalize one since they “know” what they are doing and keep a plan in their head. The first case indicates a misunderstanding of what the plan is about and in the second doesn’t understand how it should be used.

The business plan is an all-encompassing map that brings you from startup to success and then beyond. It lays out who you are and where you are going. It tells you how you plan to grow and what obstacles you may be expected to face. It tells you how much money you need and expect to make and when. It then adjusts to changes you may need to make. As we said before it includes you marketing plan as well as your financial plan, competitor information your mission statement and how you are going to operate.

Your plan is also a living document, not intended to be filed and forgotten. As your business expands so must your plan. How you deal with customers from your kitchen table is going to be different from operating a storefront or multiple locations. Adjustments to work flow and management charts will be constant. Financial information will be adjusted and SWOT will change.

JANUS Think is able to help you write the initial version as well as work with you to adjust as needed. Contact us for additional information.