THE REPORT BLOG

Spend a Little Time Now Or A Lot Of Money Later

I recently spoke with acclaimed employment lawyer Joel Greenwald, who is presenting at our special upcoming workshop, Avoiding the Newest Legal Pitfalls That Can Kill Your Business. He is baffled because he is getting much more crisis work than prevention work. In his business, a crisis usually means that a company is being sued by a former employee or that a government authority is auditing for overtime, misclassification of independent contractors, etc. Given all of the media attention on how HR claims and audits are on the rise, Joel is quite surprised. Fortunately for him, this is helping his wallet as he makes a lot more money on the crisis side.

See what else Joel has to say at our HR workshop Tuesday, February 2nd. NY Report readers will get a $50 discount with the promo code savemybiz. Register now.

Give Less Money to Your Bank

Last month I received a letter from one of the banks we use stating that they want to convert our line of credit into a fixed term loan. From what I hear, this is happening to many businesses (because the banks want to cap their exposure to those companies who are supposed to lead the recovery - sarcasm intended!). One of my investors suggested that I call and ask them to lower the rate and extend the maturity for two years. I did, and was told I would get a call back. Well what do you know? I received a new loan agreement for just about everything that I asked for. As your parents used to say, "It doesn’t hurt to ask."

Read more tips on what you can do to mitigate banking (and other economic) issues this year.

2 Stupid Business Tricks (Don’t Try These With Your Company)

I’ll start by saying that I like to do things in 3s or 5s, but couldn’t think of a 3rd (I’m sure someone will). I also wanted to limit this to marketing. So here they are:

1. Magazine subscription or renewal offers that get cheaper over time. Most business magazines and many consumer magazines are guilty of this. The first offer comes in at $29.99/year. The next one, about 6 months before your subscription ends, is for $24.99. The third one, comes in something meant to resemble a telegram (remember those?), and has an urgent offer for $19.99. Sold! My guess is that each mailing costs about a dollar (postage, fulfillment company, etc.). In addition, most subscribers are now trained to wait (or to buy their subscriptions from Amazon where the price is pretty consistent and reasonably low). This game also cheapens the magazine’s brand. Finally, the magazine runs the risk of a subscriber, waiting for the best deal, forgetting to renew. A better way to do this is to offer the cheapest price first or, even better, guarantee that the price will never be lower and keep it at one price. (Before you ask, because NY Report  is a controlled subscription publication – which means it’s free for qualified people, all we need to worry about is getting our subscribers to renew. You can renew at nyreport.com/renew. And no, it will never be cheaper than free). 

2. “For new customers only” is one of the dumbest concepts I have seen. Let me get this straight… you will give a new customer a better price than an existing, perhaps loyal customer? What kind of message are you giving to the existing customer? From a financial perspective, you have already spent time and money to get a customer. If anything, you can charge them less since you can spend less on marketing to them going forward. What do you tell the existing customer when they call and say they saw your offer for “new customers only?”

Who has another stupid business trick?

 

Andy Dunn's HR Secrets

Andy Dunn, co-founder of Bonobos wrote a great piece on BusinessWeek.com about challenges he went through in growing his company. We all have challenges, but Andy did a great job of overcoming them; in particular, HR challenges. Because he was originally told that his idea wouldn’t work, he shunned hiring people from the tech and fashion worlds. But as his company grew, those were the areas in which he, and ultimately the company, were weak. So he hired people from those areas and fixed many problems. He said, "My job as CEO, I now realize, is easy. All I have to do is recruit superstars. Of course, it's more than that: they need fair salaries, meaningful equity stakes, and most importantly, the authority to make decisions." This blew me away as I totally related to this. I didn’t need to be the expert in anything in the company. I just needed to find those people and keep them motivated.

Two years later, Bonobos is looking at about $5M in revenue and growing.

 

The No Asshole Rule is in Effect

Over the years I have heard several business owners refer to the no asshole rule, which means having no employees that are... well, assholes. While this rule might not ensure that you have the best and brightest working for you (here are some ways to find resilient employees), it does ensure that you have nice people. Depending on your culture, this is a key ingredient in work culture where employees, customers and vendors are treated nicely. Also, not having to deal with an annoyance like assholes when just trying to get the job done is challenging enough.

In a recent issue of BusinessWeek, there was a good piece on how Zappos is selling classes on creating a winning culture. (When I say winning, the company was recently acquired for a bit less than one billion bucks). At the end of the piece was a reference to David Brautigan, who runs a heating and AC repair business and attended a Zappos seminar. David decided to fire 12 employees who were not being nice and "things got better." He also rewarded those who were being nice (trust me, getting rid of the assholes was probably reward enough). With unemployment around 10%, it is not only a great opportunity to trade up with respect to talent, but with respect to "niceness" too.

 

What Government Can Do to Stop Screwing Small Business

In my last post I gave two reasons why the government is not a friend to small business (and yes, there are many more than two). So here is the simple, but not easy, way for government to stop turning to us to raise their revenue: cut spending. Yup, that’s it. If governments cut spending, they won’t need to consider businesses and business owners the place to turn to for more cash. Now I am not advocating a big cut in necessary services like education and law enforcement, etc. I am talking about hunkering down. Allow me to provide some food-for-thought.

If you were like most businesses this year, you cut expenses. You trimmed where you could and then you went back and cut some more. It was painful. Some people were let go. Some resources were eliminated and people worked harder. But most of us survived.

Government spends billions of dollars each year. And we know there is plenty of fat. The number of government agencies that are well-run and lean can be counted on one hand.

Now, I am not saying it will be easy. For starters, we need politicians that are willing to take some risks because the unions and other advocacy groups are going to fight the cutbacks (and they can fight better than anyone). But if our governments don’t take action, two things will happen that no one wants: 1) our governments will run out of cash and services will stop and 2) they will continue to go after small businesses for money and that will inhibit economic growth.

Bonus suggestion: in addition to cuts, let’s not create any more work for the government to do (like government-run health care). As Norm Brodsky says, “When was the last time that government did anything right?”

NY Report contributor John R. Rathgeber, president and chief executive officer of the Connecticut Business & Industry Association (CBIA), explains how to get more involved in government in a recent “Buck Stops Here” article.

 

Our Government: No Friend to Small Business

Ever since the recession started, politicians have said that the key to recovery is the success of small business. It is no secret that politicians are two-faced; it is a skill necessary for getting, and staying, elected. But this hypocrisy is getting worse. Here is an example: state and local governments are very aggressively targeting small businesses (as well as big businesses) with overtime and independent contactor audits (among other things). In fact, they are increasing the number of auditors. And if you have been on the receiving end of an audit, you know that the auditors are not playing fair. But it probably isn’t the auditors' fault as cash-strapped governments are looking for revenue wherever they can. So the directives come from the top.  (By the way, we have a workshop coming up on how to avoid the catastrophic legal employment pitfalls. For info, see nyreport.com/HRworkshop.)

Increased taxes hit small businesses very hard. Why? Because most small businesses are passed through entities like LLCs (taxes like partnerships), S corporations and sole proprietors. This means they are taxed at the individual level, not at the company level. It also means that they are taxed on the income their company earns, whether or not the profits are distributed. So higher taxes mean that the company has less cash to reinvest back into the business (and less opportunity to create more jobs).

These are just a few ways that government (state, local and federal) are not our friends. In my next post, I will tell you my simple suggestion to eliminate the need for government to dig in our pockets (and prevent us from helping the economy).

 

Happy Holidays! (I'm Unsubscribing from Your Newsletter)

At Thanksgiving I wrote about how I hate e-Thanksgiving cards. Well, here we are just a few weeks later and I must have received over 100 e-holiday cards. Now, I like the holidays as much as anyone else, but I really don't like e-holiday cards. They are not personal, no one reads them AND 50% of the ones I received are from people that I don't know.

Let's not forget that it doesn’t take much to send them and in an increasingly insincere world, it just becomes spam.

So, as I am trying not to let email control my life, I am using these e-holiday cards as an opportunity to unsubscribe to companies' newsletters. Not all of them, but many.

Happy Holidays!

How Your Company Can Become the Next Apple

If you've ever purchased an iPod or other Apple product, you have experienced what I call “Applefication.” If you purchased their product from their site or one of their stores you were probably impressed with the experience the moment you started shopping. No matter where you purchased one of Apple’s products, the experience is a uniquely enjoyable one. From the packaging to the product registration, every detail is well thought out. Just as importantly, the detail they put into their products reminds you that you made a great purchase. Recently, I asked the team at NY Report how we can “Applefy” some of our customer experiences. In our case, our customers are our readers as well as our advertisers. A few ideas have come up, but I want a lot of ideas. I believe that there are many ways to "Applefy" the company that don’t cost money. They could be related to the way your customer interacts with your company or something in your product/service design. I will try to keep you posted.

 

What ideas do you have for your business?

Who Works Harder (Your Staff or You)?

When I started my career in the Big 6 accounting world in the early 90s, the staff was often working until late night (sometimes early morning) and the partners went home at 6. It was almost a rite of passage that once you got to a certain level, you worked less hours. These days I’m sure everyone is working harder. I’m curious to know what is happening at small businesses. Please let us know the following (and please send this to other business owners that you know):

• Is the business owner the first to get in to the office?

• Is the business owner the last to leave at your company?

• Do people in the company work more hours than the business owner at your company?

 

The Good Thing About Bad Customer Service

OK… so I (and NY Report) have been on a customer service rant this year. We even brought in John DiJulius to NYC to speak with business owners and I have blogged about customer service on a number of occasions. Maybe the reason we are so focused on providing content about improving customer service is because of all the bad service out there. What makes it worse is that some companies have actually cut resources for customer service as the economy went belly up, instead of increasing their level of service to hold onto their clients.

So what's the good thing about bad service? All the bad service has set the bar quite low, so it doesn’t take much to impress people. Sad but true, but it represents an opportunity for those of us that get it.

We had a lunch event last week in Garden City. We told the caterer (the building cafeteria guy) that we expected 35 people. About 15 minutes before the event started, we knew we were looking at close to 50, which would leave 15 people hungry for the 2 hour workshop (we don’t like to do that). In my experience, when asking a caterer to increase an order by 43% and deliver it (albeit down the hall) in 15 minutes, you are likely to hear stuff not fit for print. This guy, Jake, said, "No problem. I'll be back in 15 minutes." He was. The food was excellent. I spoke with Jake afterwards and he told me that he just bought the place a year ago, they do hot food (he was upset I didn’t take him up on trying the ravioli as I was full from the sandwich) and he showed me his kitchen. I ended up giving him a plug at the end of the event and several people took his card.

So if you are in the Garden City/Westbury area (he will deliver for catering), call Jake at The Lunch Box at 516.279.6400 (no website).

Jake delivered good service and I was too happy to tell the world about it and try to help him out. How easy was that?

The Biggest Result of the New Normal

Last week I had lunch with the CEO of a very large digital ad agency. One of the things he told me was, "I have friends who are UPS drivers, I have friends who are big time CEOs and friends who are everything in between. They are all telling me that they are busier than they ever have been with no end in sight." I’ve felt the same way for some time. There are a lot of things behind this: working harder to make a buck in a tight economy, the thousands of messages coming our way (email, social media, etc.), and global competition, to name a few. This all means that it is harder to run a business. And it impacts our personal lives because our friends and families are dealing with the same things, one way or another.

What can you do? I'm not sure. But here are a few things worth trying:

- Don't let media make it worse. Fortunately, media outlets are better than they were a few months ago when, if you watched the news regularly, you didn't know if the sun would come out tomorrow.

- Watch (or don't watch) your incoming messaging. I have written about this many times. Emails, social media, etc. - if you don't control the water coming out of this fire hose, you are letting others dictate your agenda.

- Focus on fewer things. This might be the toughest thing on this list because, as I said above, business is more complicated. If nothing else, create a few metrics and follow them closely.

- Accept the new normal. This is how we are going to be for a while so accept it and focus on what you can control. Discuss this with your team and family.

- Figure out how to capitalize on the new normal. I haven't figured this one out yet. Ideas that you care to share?

 

Who wants a business card like Patrick Bateman?

The Brooklyn Minuteman Press thinks you will. I noticed this ad in the latest Brooklyn Progress and think it is great.

Now, if I could only get a reservation at Dorsia.

 

 

 

Introducing NY Report ’s New Interactive Website

Change is good. Especially when it means launching a brand new, interactive site with multiple new features like:

• Updated daily content
• Article sharing capabilities for your social media network
• An easier to navigate layout
• An NY Report community feature where you can comment on and discuss articles
• Fresh and innovative advertising opportunities

Our new site went live today and we are hungry for feedback. Tell me what you think by sending your comments and suggestions to webfeedback@nyreport.com

What the Twitterverse is Saying About Your Business

While we get great reader feedback, I always want to know more about what the market thinks about NY Report. Last week I read a Wall Street Journal  article crediting Twitter as something more than just a social networking tool. Twitter can also be used to gauge company sales and consumer choices –a very powerful thing.

To prove this theory, the article authors linked tweet traffic about films to the amount of money those films made on their opening nights – read more on this. The more positive tweet traffic a film received prior to its release, the more money it made on opening night. How can businesses leverage this method to reach their target consumer base? Here are some tips from the article:

- Connect with customers and really listen to what they’re saying

- Have an eye-catching Twitter page, back it up with interesting comments, and retweet, retweet, retweet!

- Keep an eye out for influencers and reach out to them

- Search what people are saying about your company or yourself

- Follow trending topics – your business might just show up as one

The bottom line? Using Twitter effectively as a marketing tool means reading more than you are writing. To relate this approach to old school marketing media, don’t just use it as a billboard, use it as a telephone.

Tell me how your business manages Twitter.

Promotion at NY Report

I am pleased to announce that Daria Meoli has been promoted to Executive Editor. Daria joined the team two years ago as managing editor and as her role within the company has changed to include more and more responsibilities, I felt the time was right to give her a promotion. In her new position, she will not only continue to manage the magazine content, but will lead our new online content initiatives, as well as contribute to special projects.

Congratulations Daria on a well deserved promotion!

How Not to Say Happy Thanksgiving

This year, I received no less than 10 Happy Thanksgiving e-cards. Two years ago, I wrote a blog about why I think they suck, and tis the season to revisit why Thanksgiving e-cards are such a bad idea:

• E-cards are not appropriate for business. We know they are easy to send which doesn't say much about the effort on the part of the sender. They also clog up my precious inbox and require me to also click. Sorry, too many steps for something that I don't appreciate.
• About half the cards I received were from people I don't know (or maybe I met them once and I am in their contact management system).
• Several of the emails (not that I looked in detail) looked like they were the exact same thing. So what is the point of sending something when 10 other people will send the same thing? 
 

Because many people/companies send out cards during the traditional holiday season (around Christmas), I do think that sending something out around Thanksgiving is a good idea. But when I mean sending something, I mean a gift or a snail-mail card. Something that shows that you went through an effort.

Come Friday, I know one thing I will be thankful for – no more e-cards.

An NY Report Team Member Does the Herkie (and I Missed It)

Yesterday afternoon, I heard a commotion of laughing and clapping coming from outside my office door. I came to find out that one of my non-sales employees agreed to do a herkie jump, a stunt commonly performed by high school cheerleaders, in front of the whole staff when one of my salespeople made a sale over $20,000. It was her challenge to the sales team. The result was the entire company rooting for the big sale, everyone had a good laugh and it created a camaraderie across departments.

I heard that there is a video tape of the "performance," but am told that no one is giving it up. So my team did something cool without me and now they are sticking together. I'm so proud.

Taming Email Overload at NY Report

One of my big issues when managing my own time is not allowing anyone else set my agenda. However, when you are a slave to email, that is exactly what you are doing. At our weekly company meeting, Amy, our sales director, brought up this issue and referred to an article that appeared in our November issue - "Staying Productive in the Information Age." As part of an effort to become more productive, she is going to try to only check emails four times a day. If that fails, she'll limit herself to once an hour. Since that "new mail" icon can be difficult to resist, she can either turn off the alerts, turn email offline, or log out of email completely and keep the BlackBerry out of sight.

Several of the other employees chimed in with how they reduce email distractions. Business development manager Chris Peel said he creates rules in email account to have all his newsletters delivered directly into a designated folder, instead of his inbox, so he is able to see only relevant emails as they come in and view newsletters when he has the time. I subscribe to newsletters under my Gmail account, so that only business-related correspondence is sent to my Outlook inbox.

It is just as important to be respectful of other's time. Instead of distracting others with several emails each day, managing editor Daria Meoli keeps draft emails open for other team members and as thoughts or projects come up, she adds them to the draft email and saves it, but doesn't send it. She sets the email rule to send after a specific time, so the team member receives only one email from her the next morning.

Marketing, Creativity & Branding, Oh My!

Here are a few ideas I shared with the audience at yesterday's New York Entrepreneur Week panel:

1) Don’t think about “old vs. new media,” but instead, choose the mediums where your audience is.

2) Make sure you have a marketing plan; people need to know who you are and what you offer. I have seen too many companies in the exact same place they were six years ago because they just rely on networking.

3) Another mistake I have seen from many entrepreneurs is not spending enough time on the creative process. Being creative takes time and you need to do that to create a message; regardless of medium, that is very compelling.

4) According to sales expert Jack Daly, selling is about the transfer of trust. One way to gain this trust is through your branding; in terms of trust in the B2B world, print outweighs online by a lot.