Category: Small Business

Why a Marketing Plan is Importan

Successfully marketing a product or service is one of the most complex problems all entrepreneurs face. Every type of entrepreneurial enterprise requires marketing to compete and survive. How does an entrepreneur begin? Before you can decide on which marketing techniques to implement, you must develop a marketing plan.

A marketing plan consists of two primary elements: goals and strategies. Goals will determine the scope of your ambition in a particular time frame and allow you to allocate your resources appropriately. Quantify your goals whenever possible-for example, increasing market share by 10%. Strategies should be specific, measurable, and time specific.

There are many items to take into consideration before developing your marketing plan. Study the growth trends of your industry, evaluate your competition, analyze your key customers, and appraise the realities of the current-marketplace. Begin market planning by clearly identifying all the market segments to which you intend to sell. The next step is to arrange the identified markets in order of priority. Target marketing is the fundamental strategy used by successful businesses.

Next, examine the market segments that seem most attractive and target them for penetration. Develop special marketing tactics for each target market-a strategy known as market segmentation. Target your markets and then develop a marketing program for penetrating each one. Your business plan should explicitly identify all markets and then provide the basis for your selection of target markets.

If you have not yet written a business plan, go back to square one and develop it. Each of your identified target markets should be considered almost as a separate marketing program. Unfortunately, many entrepreneurs start their ventures without proper research and without writing a business or marketing plan. Then, when sales stagnate or decrease, they begin to look for solutions. A marketing and business plan can help you devise a strategy to increase sales.

The foundation of your marketing plan will be the marketing mix, which includes such elements as promotion, advertising, publicity, direct mail, sales training, pricing, positioning, and customer service. Many entrepreneurs feel that placing a few ads or using coupon mailers constitutes a marketing plan; then they wonder why they do not achieve better results. When someone mentions marketing, people automatically think of advertising. Instead, new start-up ventures with limited marketing dollars should concentrate on publicity and promotion. There are many inexpensive ways to market products and services.

Deciding how to penetrate each target market is truly an art and takes much planning and experimentation. The difficulties involved in attempting to reach just one market can be overwhelming, especially when there is limited money to spend on marketing products and services. When putting together your marketing plan, consider potential pitfalls and how you will deal with them. If you know ahead of time what to expect, you’ll be better able to surmount obstacles as they arise.

It is essential that you be able to track the effectiveness of your marketing plan and measure how well it is working. Then you can allocate your resources to the activities that have the best payoff for your venture.

How you measure the effectiveness of your marketing dollar varies. If you want to find out if an ad brings in new customers, count your current customers and then count the number of new customers after the ad appears. If you want to determine whether a trade show increases customers, track new leads and/or total sales from these leads.

A good technique is to include a response mechanism in your marketing efforts-for example, an invitation to bring an ad in for an extra discount or a free gift. The key is to track the efficiency and return on your marketing investment. Determining which media and what message is working is critical, since this information indicates where to direct your marketing dollars and what to say.

Cheap Cars for Small Businesses: Finding Inexpensive Vehicles for Business Use

Cheap Cars for Small Businesses

While a major corporation can easily afford an entire fleet of shiny new vehicles, many small companies struggle to buy one cheap car. Finding cars, trucks and vans that are affordable and look presentable can be a challenge. However, there are several ways for a small business to buy cheap cars.

Look for Tax Credits or Deductions

Small business owners that have a specific budget for buying a new car but don’t like the appearance and features in the economy models they can afford may want to consider buying the vehicle as a consumer so they can take advantage of tax credits and deductions. While the popular US Cash for Clunkers program has been phased out, there are several other incentives still available.

  • State and local sales and excise tax deduction- According to the IRS, people who buy new cars, some new trucks and new motorcycles may qualify for a deduction on their 2016 tax return. (This is the return that is due in April of 2015.)
  • Tax credit for hybrid cars- While fueleconomy.gov warns that this tax credit is only honored until each car manufacturer sells 60,000 models, there is still money available for tax credits on some hybrid cars.

Avoid Extras When Shopping for New Cheap Cars

Of course, even the cheapest new car can be too pricey after every upgrade available is added on. When buying a company car or truck, smart business owners refuse all upgrade offers. They know that as long as the car looks presentable on the outside, the fact that it has heated seats and a top of the line stereo system inside does nothing to increase their profits.

Search for Used Company Vehicle Sales and Auctions

A major home improvement company in the Baltimore metro area recently sold a fleet of used cargo vans to employees, local small businesses and other interested parties. A group of power related companies auctioned off many different vehicles at a public auction. While these vehicles were certainly not new, they were in fairly good condition and looked very presentable. Usually, by making a quick call to local companies, a new business owner can find out if and when sales are planned. There are also several government sites that offer used car and truck auctions.

Of course, there are some additional costs involved when someone is buying a used cheap car from another company instead of buying a new vehicle. Often, the car’s interior will need to be detailed to remove stains and objectionable smells, such as that of secondhand smoke. In many cases, the new buyer will also need to have a car repainted to cover the previous company’s logo.

Although it is harder to find cheap cars for small businesses than it is to buy a shiny new car right off the lot, smart entrepreneurs know that it is worth the extra work. After all, any money they save by buying an inexpensive company vehicle is money that can go toward growing their new businesses. These entrepreneurs are happy to search for government incentives or head to used company vehicle sales to find what they need at a low price.

Support for Small Business From Federation of Small Businesses UK

Support for Small Business From Federation of Small Businesses UK

The Federation of Small Businesses (FSB) is the largest organisation that actively campaigns on behalf of the millions of small owner-managed organisations across Britain.

Membership of this non-profit organisation is only open to business owners who are actively involved in running their own commercial operations, whether as a sole trader, partnership or limited company. Set up in the mid-1970s the FSB had grown to over 213,000 members by mid-2010.

Every member of the FSB is entitled to a number of direct benefits, such as free services or discounts. They are also supporting a body who lobby central and local government on their behalf.

Benefits Available to FSB Members

The FSB operates through over 200 branches spread across the UK. Those joining the FSB are automatically assigned to a branch based on their geography, although they are free to get involved other other branches if they choose to.

The FSB offers its members networking opportunities through a schedule of events, such as breakfast meetings, presentations on specific subjects, and annual celebrations. They also get involved in local event, providing a focal point for business owners.

In addition to networking, the FSB operates a members’ directory on its website. The directory can be searched by anyone looking for a specific business, even if they are not a member themselves.

Anyone taking out or renewing annual membership of the FSB also enjoys a number of other advantages. Owners of small businesses in the UK have to comply with a wide regal of legal and bureaucratic requirements and the FSB helps by offering legal support for free. They provide a wide range of documents online, in the members only section of their website, and they also operate a telephone advice service that is available 24 hours a day all year round.

Another significant benefits to members is support for those with serious health conditions. Membership of the FSB includes entitlement to access to a personal nurse advisor. These provide practical advice, emotional support and can help organise appropriate therapy.

How the FSB Promotes Small Business Success

As the UK’s leading business organisation the FSB are active in promoting the interests of small enterprises. They sponsor Celebrate Success, annual awards made by The Prince’s Trust in recognition of the efforts of young people in their local community.

The FSB also lobbies government on issues that affect the small business community. One significant achievement was the establishment of a partnership with the UK government to enable students to gain work experience through subsidised internships.

Local government is encouraged to use small businesses and to sign the FSB’s Small Business Engagement Accord, demonstrating their support for local firms.

The Federation of Small Businesses is a not-for-profit organisation that exists solely for the benefit of its members. It helps the millions of tiny businesses in the UK to have a voice at national level and to access many of the benefits more easily available to major organisations.

Barriers to Starting a Small Business: Obstacles Holding Back the Entrepreneur

Barriers to Starting a Small Business

Inherently, business is risky. Often, fear is the sole factor that holds back small business owners from pursuing dreams and mighty plans. If they’ve been reluctant to go on their own, it’s time to consider some of these obstacles that block their path, along with practical solutions to get past them.

Feeling Overwhelmed

Some people are overwhelmed by their new business idea thinking they’ll have to go for it all at once and there are too many things to do. The big picture should be broken into manageable tasks. For those currently employed, they need to hold on to their jobs, slowly scale down to a part-time job or as a contract worker, get the feel of more flexibility in schedule. Some small business owners enlist their skills to create multiple sources in income as they build their business.

Focus on the Negative

As long as the potentials of the new business ideas have been studied and researched, plans should not be blocked. People who dampen enthusiasm unnecessarily should be avoided. Instead, those who encourage and offer support should be seek out, for example, some business owners may want to share their success story.

Insecurity in Product and Service

The nagging feeling that the product and service in mind may not work can be daunting. When this happens, waters can be tested by conducting a pilot test to solicit feedback. Since this is a test, it is done freely. Honest feedback is solicited from the participants of the test.

Lack of Money and Time

A solid business plan is necessary. Focus is how to get more time and space for the new business. Unnecessary things, pending obligations, toxic relationships and unhealthy habits should be taken out of the way. As regards any money matter, a plan is worked out to reduce unnecessary personal spending to give way to business needs.

Lack of Business Management and Technical Competence

Established small business owners are good sources of information. Online research and local libraries are handy resources that should be used. Topics include how to start a small business, writing business plans, small business marketing, new business ideas and easy to follow software programs. It is important to create a business plan. It doesn’t have to be too complicated at the start. As knowledge builds up, so does confidence.

Loss of Benefits

Leaving the corporate world to start a small business is daunting as one loses a safety net. It is easier for a younger and healthy worker to give-up health benefits. For older start-up entrepreneurs, health benefits remain a major concern. Certain options like health savings is a good one.

Lack of Support from Family and Friends

Without the support of family and friends, going solo is a challenge. Business plans must be properly explained. Usually, family and friends are supportive once the new business ideas are properly explained.

Fear of Isolation

Going solo isolates. It is a concern to some people, most especially those who plan to work from home. The solution is to build a network. Time should be set aside to connect with other business owners, as well as friends, former colleagues and any potential person. The network is a source of support, advice and information.

Once these barriers are addressed accordingly, a good feeling develops and renewed confidence sets in. With commitment, dedication and guts, it’s just a matter of time when the small business owner or entrepreneur takes the plunge.

Bookkeeping Basics – Accounting Methods for Small Business

Bookkeeping Basics - Accounting Methods for Small Business

Accounting or bookkeeping is one of the most fundamental parts of a successful business. Choosing an accounting method should be one of the first decisions when beginning a business and should be appropriate to the type of business as well as goals of the business in the future. Four important terms to learn whether beginning a business or just learning about bookkeeping are, Cash Method, Accrual Method, Single Entry and Double Entry.

Cash Method

Under the cash method of accounting money is accounted for on the books only when it is actually received or paid out. A payment is recorded when the actual payment is received by the company, not when the transaction is made or shipment occurs.

(Most appropriate for sole proprietors, businesses with no inventory, small service companies.)

Accrual Method

Under the accrual method, the records of expenses and receipts are recorded on the transaction date, not the date that actual cash or compensation changes hands. Sales would be entered on the books when the invoice is generated, regardless of whether payment has been received. Expense payments would be recorded on the date that product or services are ordered.

(Most appropriate for large businesses, corporations, businesses with inventory and businesses that sell on credit.)

Single Entry

Single entry is a simple record of transactions where the bookkeeper enters only one entry for each transaction. Transactions are entered either as revenue or expense.

Examples of single entry accounting:

  • A personal checkbook register
  • A single column or double column spreadsheet for a business listing only revenue or expenses

Single entry accounting is mostly used for individuals, sole proprietors, or small businesses accounting models where only tax records and profit analysis is required.

Double Entry

The double entry system provides a more complete financial picture to a business. In addition to revenue and expenses, debits and credits are also recorded. The additional records allow for reconciliation and balancing transactions. When recorded together, debits and credits must equal out in order to reconcile.

Benefits of Double Entry

  • Double entry is the standard in business accounting
  • Can be used with both the cash method and the accrual method
  • Double Entry is the method utilized by most accounting software
  • Provides a more accurate picture of sales and expenses for reporting purposes

Upsell for Small Business Success: Offer Related Products or Services for Additional Income

Upsell for Small Business Success

A hair stylist recommends several products to customers who want to know how to care for their hair. Since she doesn’t carry those or any other products, she has to send the customers to another shop to buy the items. This means she has missed out on all of that potential revenue and has given it to someone else instead. A smart small business owner will be sure he or she takes advantage of the chance to sell related items and services to clients instead of sending those customers to someone else.

Why Upselling Products Works

People are busy and stressed. The last thing someone who finally managed to squeeze in a visit to the hair stylist needs is yet another errand. When the hair stylist offers the recommended hair care products right there in the same building, he or she is providing a convenience that customers appreciate. Because of the convenience factor, hair stylists don’t need to compete with budget hair care businesses or beauty supply wholesalers. They can sell products at a substantial mark up and still make a decent number of sales.

Pet sitters who offer grooming services and coffee shops that offer attractive coffee related gift ideas are two other examples of businesses providing the same convenience to their customers.

Don’t Be Afraid to Promote Upsells

Some small business owners feel that asking customers to buy products is too pushy. They are afraid that they will seem like they are just after money. The key to making an upsell without seeming pushy is to genuinely believe that the product or service will be helpful to your customer and to simply state that you have a product or service that would help solve the customer’s problem.

For example, a hair salon owner knows that the shampoo and styling products he or she uses in the salon will help a customer keep that new haircut and dye job looking awesome until the customer comes in for a touch up. In this case, the stylist shouldn’t hesitate to tell the customer that the products that were used to create today’s look are available right by the register. Even better, he or she should go to the shelf, get the products and tell the customer that they will help keep that hair looking fantastic. On future visits, the stylist should remember to ask if the customer needs more of any of these products.

Remember, when upselling is done properly, it isn’t just upselling. It is also great customer service.