THE REPORT BLOG

Tips from New York's Best Networkers

Last night’s NY Report event at Lighthouse International in NYC really struck a chord with the small business community. The sold out event attracted more than 225 small business owners and decision makers who came out to get tips from networking gurus Sergio Fernandez de Cordova, founder of FUEL Outdoor; Paul Neuman, president of Neuman's boutique catering; and Larry Weiss, president of Atlantic - Tomorrows Office. All three panelists built multi-million dollar businesses, primarily by networking. For a sample of the useful tips the panelists provided, check out the “Top 5 Takeaways from Turn Your Network into Net Worth.” By the way, if you want to see who was there, check out this partial list of attendees.

 

After the discussion, attendees then immediately put those networking principles into practice at the following reception. Deals were definitely done last night.

Figuring Out What We’ve Known All Along

Chris Anderson, editor-in-chief of Wired magazine recently described the “new, new economy,” where giant top-down corporations are decentralizing and externalizing. The article highlights an economic trend, where giants like Detroit’s auto industry and Google are opting for more bottom-up approaches in order to survive in the current economy (practices small businesses have been using all along). The article makes a case for the impending extinction of the huge conglomerate.

But how can we as existing Main Street businesses compete in the new new economy as the small business space becomes more crowded? I share some of what I’ve heard in a recent letter from the editor. 

Is Social Media for Business Bullshit?

NY Report contributor and BusinessWeek columnist, Gene Marks, recently took the contrarian view of the virtues of social media for business. Gene is clearly in the minority here.  What do you think?

 

For more tips on how to invest your time on smart networking, join me tomorrow at Lighthouse International for “Turn Your Network into Net Worth,” an NY Report event.

Legendary NYS Entrepreneur's Take on Albany: Adios

A few days ago, Tom Golisano, board chairman of Paychex, Inc., and the founder of Responsible New York, wrote an editorial for the New York Post. In the letter, Golisano says the only taxpayer incentive included in Albany’s new budget is the incentive to move.

From the small business owner’s perspective, I couldn’t agree more.

Best Practices in Hiring

In yesterday’s post, I talked about the worst hiring practices that, unfortunately, many of us (including me) are guilty of. In his talk, Barry Deutsch did more than point out common mistakes – he provided suggested best practices. Now, here are a few of the best practices from Barry:

• Include the results you are looking for from the position in the posted job description.
• Define the problems, obstacles, actions and results, before even thinking about beginning a search.
• Remember that the best candidates are seriously checking you out. Sell to them like you would sell to your top client. Be prepared, don't take calls or check email during the interview, and CHALLENGE the candidates.
• Ask for examples of previous results related to the results you want the candidate to achieve. Do not let candidates off the hook here.

Barry also said that the process for high level candidates will often be five rounds. The best candidates will understand and appreciate this. 
 

I am not doing Barry justice, and I don’t want to steal his thunder. Check out his website for more. I can tell you that his presentation made me totally rethink our hiring (and management) process. See what NY Report expert Al Siebert says the top “Seven Tips to Hiring Resilient Employees” are.

Are Your Hiring Efforts Attracting the Bottom 30%?

I recently sat in on a Vistage session with Barry Deutsch of Impact Hiring Solutions. Barry said that today, we have "a once in a lifetime opportunity to hire great talent." Great news, but according to Barry, most of us have bad hiring practices that will prevent us from finding top talent. Two of the biggest mistakes many business owners make include not spending enough time defining the results that we want from employees and not looking under rocks for the best candidates. After all, he said, the best candidates are currently working (which means that they aren’t on job boards). Here are some of our "worst practices" (of which, I am also guilty):

 

• We ask leading questions
• We are poor note takers
• Our job specs include unimportant things like: industry experience, skills and knowledge, and minimum education

Now that we know the worst practices, what about the best practices? I’ll address that in my next blog.

For more information on improving recruiting practices, NY Report contributor Barbara Kurka recently wrote an article about how to market your business to attract top talent.

 

Stimulus for Small Businesses Results in Higher Interest Rates

I know there is a lot of talk about the stimulus plan and what it will do for small businesses, but here is what I can see with my own two eyes. Earlier this week I received a notice from a bank that they are adding 4% to our interest rate on our credit line (bringing it close to 10%). Reading the fine print, I noticed that I can opt-out of the increase, pay off the existing line according to the original terms, and then the account will close (meaning we can no longer draw from the line). Fortunately, it is not an issue for us, but I am sure it is for others. By the way, the bank said they would lower the interest rate if I opened a checking account with them and put the line of credit payments on auto-pay.

The next day I received an email from one of our credit card providers and they are raising their interest rate into the double digits. Once again, not a big deal for me as I don’t use the card. When I spoke to both banks there was no indication from them that there was anything wrong with our credit scores or payment histories. One of them said, "We are making changes in light of current economic conditions."

So, let me get this straight. The government passes a "stimulus" package and small businesses with great payment histories now have to pay more to borrow money? I voiced similar frustrations in a previous letter from the editor.

What is Jason Finger Doing Next?

Today over lunch, Jason, NY Report's May cover story subject, told me about his summer plans. He is going to Hawaii for five weeks with his family. Ok, maybe that isn't earth-shattering news, but the story behind his trip is one that any business owner can appreciate.

Jason and his wife Stefanie had plans to go to Hawaii for their honeymoon several years ago. Before they went, Jason received an invitation to speak at a national food service event at the same time they had planned to go on their trip. Like any smart business owner would, before he committed, Jason asked his wife if he could speak at the event (which would mean putting off their honeymoon). Recognizing the opportunity, Stephanie said yes. But, she not only wanted an IOU on Hawaii but "dividends" (like Jason, Stefanie is a lawyer). Hence the five week trip this summer. Have fun guys!

Finally, a Major Media Company Talks About Small Business

Small Business Network founder, advocate and radio show host, Jim Blasingame, appeared on Fox Business’ Money for Breakfast this week. Jim, a current NY Report Small Business Advocate award winner, made some great points. He not only said that the government has done nothing for small businesses, but he pointed out the irony of this considering that small businesses are the most likely source of job growth to get us out of this mess and aren’t responsible for making the mess in the first place.

 

I agree with something else Jim said. The best thing the government could do is get out of our way by not raising taxes for small businesses, which would hit New York and New Jersey small business owners incredibly hard.

 

View Jim's segments: Clip 1, Clip 2                 

Green or Obscene

This morning, while walking into the 72nd Street subway, a new area dry cleaner was handing our coupons along with a bottle of water. Good guerrilla marketing? It probably would have ranked as OK, except for the fact that they handed out bottles of water along with the coupons which touted themselves as green cleaners.

Bill Russell, Red Auerbach and Us

With Red Auerbach as the coach and Bill Russell leading the team, the Boston Celtics won 11 championships over 13 seasons. Bill Russell recently wrote a book about his friendship with his mentor, titled Red and Me. According to a review of the book in the Wall Street Journal, Russell described how Auerbach didn't try to change his playing style to the Celtic’s style when he joined the team in 1956. Instead, Auerbach focused on making Russell a better player through his own strengths.

This is a great lesson for any leader or manager, although certainly not a new one: play to people's strengths. I do think this is easier said than done, as many of us often want our people to conform. And I am not saying that this means that people don't have to be managed. But, if the employee and manager want the same end result, the employee is talented and there is mutual respect, better results will often come when the employee can focus on maximizing his or her strengths, as opposed to conforming to existing systems within the company. NY Report contributor Adrian Miller applied these principles to training sales staff in the article “How to Get Your Sales Staff to Love Training.”

One caveat to all of this: I have seen times where a company needed different strengths from those of a very talented employee. In cases like these, the fit and timing just isn't right and it was best for the company to encourage the employee to look for a new opportunity.

Extra Step Boosts Advertising ROIs

Today I spoke with an attorney who is going to run an ad campaign with us. As we discussed the "creative," which includes the text in the ad, I asked him about his goals of the campaign. As he specializes in employment law (which is a very hot topic these days because of government employment audits and termination related lawsuits), he said he would like to drive awareness and hopefully catch the attention of a business owner who is dealing with these issues (who would then call him). I asked him about those readers that might be intrigued with the topic, but don't have a need right now.

I suggested that he gives a compelling reason to encourage someone to sign up for his email newsletter or a white paper. This way, his firm would have the reader's contact info and could regularly send relevant communications to the reader. When the business owner faced an employment related legal issue, his firm would be top of mind. I call this a two step marketing process. Use the ad (or direct mail) to capture a prospect's information and then use your marketing programs (emails, calls, etc.) to keep in touch. As I said to him at the end of the call, "this way you don't need to keep paying me to reach readers who are interested, but not ready to buy." Of course, if the campaign continues to produce, it might make sense to continue to advertise.

For more cost-effective marketing tips to up your ROI and increase prospects, read NY Report contributor Philip Courtney's article, "Whaddya Mean Lucky?"

Why You Should Hire from the Midwest

On Monday, I had the pleasure of having lunch with Zane Tankel,who was on NY Report's September 2007 cover. We spoke about a lot of business issues, including a call Zane had with a landlord that resulted in his landlord wanting to meet somewhere for a fight. While the proposed ass-kicking didn’t surprise me (after all, who hasn’t almost come to blows with their landlord at one time or another), another topic of conversation did. Since Zane was on the cover, his company, Apple Metro, which owns the NYC Applebee's franchises, has grown significantly, despite a dismal year for the restaurant industry.

Zane hired a new COO who came from the Applebee's corporate franchiser. Since then, the company has been hiring restaurant and district managers from all over the country. In fact, 50% of new management positions are filled by out-of-towners (at a significant expense to Apple Metro). The other half are promoted from inside the company. When I asked why, he had a few reasons including that the company needed a new perspective and that he found that people from the Midwest are hard workers.

 

One Afternoon With Nancy

Last night I attended NY Report contributor Nancy Shenker's social media presentation at Yonkers Business Week.  Among the things she mentioned was the importance of your Google credibility. When people are thinking of doing business with you, they are Googling you. What shows up when people search your company or you is critical, so check often. And, there are things you can do to put what you want people to see at the top of the results. 
 

In addition to the above takeaways that Nancy mentioned, I also noticed that she had fliers for her Social Media in a Box service. What I liked about this is how she is packaging what is (presumably) a low priced and needed service. Perfect for a recession.

Social Media – What’s in it for SMB?

Anita Campbell, editor of Small Business Trends recently wrote, “Top 4 Sites For SMBs Navigating Social Media,” highlighting the four best online social media tools to help increase business connections and site traffic, heighten visibility, gain customers and save precious time. She mentioned Yahoo Answers (information sharing), Twitter (social networking and microblogging), WordPress (blog building) and Flickr (photo sharing).

In addition to mentioning a few best practices for each tool, Campbell advises users to weed out the beneficial from the useless; don’t jump on the entire social media bandwagon just because you think “the more, the merrier.” Social media tools should directly benefit your business objectives and save time in doing so.

NY Report contributor, Nancy A. Shenker, agrees. Shenker’s article in the May issue, “Social Status – How to Grow Using Social Media,” lists four benefits you should be gaining from social media tools: networking and communication, relationship cultivation, trend watching and eye opening, and awareness building and commerce. She also explains how to get those benefits from social media.

Sales Down? Change Your Offer

Drue Sanders, founder of Albany-based Drue Sanders Custom Jewelers, stocked up on more silver inventory than gold in response to her gold sales drastically dropping during the 2008 holiday season. Since silver prices are starkly cheaper than gold or platinum, Sanders was able to sell merchandise at a considerably lower price - something not only benefiting her customers' needs, but Sanders' needs as well, since moving greater volume helped compensate for a decrease in big-ticket sales. The recent Wall Street Journal article, "Smart Ways to Cut Prices," proves that flexibility is crucial for maintaining consistent profit margins.

A few months ago, many of our readers echoed this sentiment in our annual Success Guide. Mardy Sitzer, president of Bumblebee Design & Marketing, found success in a down economy with a similar strategy. 

"We've eliminated services that were cumbersome and no longer profitable and focused on what our core business really is about. When we started 15 years ago, the ratio of print media to Web was the reverse of what it is today. We provided a lot of production services to accommodate direct mail and other print and fulfillment requirements for our clients. As things began to more toward more digital and less print, it no longer paid for us to maintain the equipment and staff to support production, which was eroding our profitability. As the numbers began to tell the story, we had to cut and move on. Interestingly enough, the cuts made room for us to grow faster in other departments."

Has flexibility in your product or service offering generated revenue for your business? I want to hear about it.