Thursday, December 20, 2007
A Great Resource!
Many small business owners aren't really sure of what steps they should be taking to better ensure the success of their small business. The U.S. offers a wonderful resource for small businesses. The website is http://SBA.gov. The website has everything for a small business from "What's a business plan and how do I start my business" all the way to "How do I start exporting." There are many great articles and how to guides on there. This site is a must read for small business owners who are serious about taking their business to the next level.
Thursday, December 13, 2007
Effective, Cheap Advertising
It's not hard to come by; the hard part is deciding what method. Me being the owner of a Small Gift Basket company (http://BlackRiverBaskets.com), I understand how hard it can be to market your business cheaply. Adsense (Google's Pay Per Click Program) gave me clicks and impressions but no conversions. I burnt through $55.00 in about two weeks. Granted that isn't very expensive, business cards would have been more effective. Some will argue that the impressions are worth the money, and they very well may be when it comes to brand recognition, but when I say effective advertising, I mean making people into customers.
So below I'm going to list some of the really effective ways to advertise cheaply, and pretty effectively too!
Business Cards: This is a must. No professional business lacks business cards. They are cheap enough and they give all of the pertinent information. When speaking to people, bring the conversation to where you can say "Oh, I've got a business, here's my card if you need anything." Leave it at that and continue the conversation. People are a lot more comfortable doing business with someone who looks established, serious, and professional.
Flyers: Everyone hate's these and crumpl -- Wait, no they don't. I'm a crumpler and even I read the business name before crumpling! If it is a business that I need I read the flyer. If I need my haircut and I see a flyer on my car I'll read it first if it mentions hair. The big downfall of flyers is people put way too much information on them. It's tempting but treat it as a big business card. Contact Info., Business name, short list of things you do or sell, advantages to doing business with you rather than the competition, thank them. That's pretty much it.
Word of Mouth: I'm a fanatic with delivering a great product in a great way. Once you have a happy customer, they will refer other people to you. Then you have more customers that already trust you! Word of mouth is by far the best method of advertising. This is why giving out freebies is a great way to drum up some word of mouth!
In case you're wondering, I'm not really touching on internet type advertising, as I've said, internet conversions are expensive! What I'm demonstrating is cheap effective advertisement to reach your local audience. I use these methods with my business too. In one of my next articles I will give some tips on effective internet advertising.
So below I'm going to list some of the really effective ways to advertise cheaply, and pretty effectively too!
Business Cards: This is a must. No professional business lacks business cards. They are cheap enough and they give all of the pertinent information. When speaking to people, bring the conversation to where you can say "Oh, I've got a business, here's my card if you need anything." Leave it at that and continue the conversation. People are a lot more comfortable doing business with someone who looks established, serious, and professional.
Flyers: Everyone hate's these and crumpl -- Wait, no they don't. I'm a crumpler and even I read the business name before crumpling! If it is a business that I need I read the flyer. If I need my haircut and I see a flyer on my car I'll read it first if it mentions hair. The big downfall of flyers is people put way too much information on them. It's tempting but treat it as a big business card. Contact Info., Business name, short list of things you do or sell, advantages to doing business with you rather than the competition, thank them. That's pretty much it.
Word of Mouth: I'm a fanatic with delivering a great product in a great way. Once you have a happy customer, they will refer other people to you. Then you have more customers that already trust you! Word of mouth is by far the best method of advertising. This is why giving out freebies is a great way to drum up some word of mouth!
In case you're wondering, I'm not really touching on internet type advertising, as I've said, internet conversions are expensive! What I'm demonstrating is cheap effective advertisement to reach your local audience. I use these methods with my business too. In one of my next articles I will give some tips on effective internet advertising.
Wednesday, December 12, 2007
My SWOT Analysis of ECommerce Inc.
ECommerce Inc. sells general gifts over their website. They aren't getting any sales over the site and minimal sales in the area. They have very little start up capital so they don't have a store front. They've managed a couple of sales by people they know browsing the site and requesting gifts in person. This business is in severe need of a SWOT analysis.
Strengths: They have very low operating cost due to the website being up and not having the upkeep of a storefront. They have a website which makes them a potentially global entity, but for our purposes let's say they only deal nationally. So, they have a potential market of a full country. A website gives them a much larger looking company then it actually is.
Weaknesses: Okay, this will be long winded. They have very limited exposure because of low operating capital. They don't have a store front when there main income is local so far. They have very limited advertising online, which is bad when your main revenue should come from the internet. Their product isn't exactly unique. They offer a higher quality product but that makes it harder to compete price wise. Low income means that they are more stagnant. A website looks good but it is hard to persuade people you're legitimate without a physical address. And when your main revenue is coming in locally for the time being, how will you look legitimate without a storefront?
Opportunities: Business to Business (B2B) looks to be the most promising thing. Ecommerce Inc. could become a business solution rather than a retail outlet. This for sure will cut down on local competition; eliminate their need for a retail storefront because businesses don't typically shop for their solutions by going to a store. This will also allow them to focus their advertising effort by minimizing their target audience to professional businesses that would need gift solutions.
Threats: Other online gift solutions for businesses. They are nearly limitless, and there are some very big ones out there. They also run the risk of a large company needing a far too large order, this might possibly be resolved with a loan to fulfill but then there are man power issues.
I think this is a fairly decent beginning to a SWOT Analysis. I'll make it more pretty in the coming days (including those square graphs that everyone adores so much.) but hopefully this helps to give some direction.
Strengths: They have very low operating cost due to the website being up and not having the upkeep of a storefront. They have a website which makes them a potentially global entity, but for our purposes let's say they only deal nationally. So, they have a potential market of a full country. A website gives them a much larger looking company then it actually is.
Weaknesses: Okay, this will be long winded. They have very limited exposure because of low operating capital. They don't have a store front when there main income is local so far. They have very limited advertising online, which is bad when your main revenue should come from the internet. Their product isn't exactly unique. They offer a higher quality product but that makes it harder to compete price wise. Low income means that they are more stagnant. A website looks good but it is hard to persuade people you're legitimate without a physical address. And when your main revenue is coming in locally for the time being, how will you look legitimate without a storefront?
Opportunities: Business to Business (B2B) looks to be the most promising thing. Ecommerce Inc. could become a business solution rather than a retail outlet. This for sure will cut down on local competition; eliminate their need for a retail storefront because businesses don't typically shop for their solutions by going to a store. This will also allow them to focus their advertising effort by minimizing their target audience to professional businesses that would need gift solutions.
Threats: Other online gift solutions for businesses. They are nearly limitless, and there are some very big ones out there. They also run the risk of a large company needing a far too large order, this might possibly be resolved with a loan to fulfill but then there are man power issues.
I think this is a fairly decent beginning to a SWOT Analysis. I'll make it more pretty in the coming days (including those square graphs that everyone adores so much.) but hopefully this helps to give some direction.
Call in the... SWOT?
While small businesses have many tools at their disposal, one of the most important ones that I stress is a SWOT analysis. A SWOT analysis, when done in an unbiased manner, can reveal a lot of intimate information about the inner workings of a business and where it is to go. Allow me to first explain SWOT, then, in my next post, I will use a fictitious small ecommerce business, Ecommerce Inc., as our example.
What is SWOT? SWOT is an Acronym that means Strength.Weakness.Opportunity.Threat. What does each of those mean?
Strength: The points of your business that are strong. Do you have a very unique product? Do you have a lot of finances to fund your business? Do you have a really good marketing campaign? What differentiates you from your competition? Are you able to deliver worldwide while your competition can only fulfill the local demand? Or maybe your strength is that you ARE a small business and you can provide the personalized solution that your customers may require.
Weakness: This is where you must truly be honest with yourself. Are your prices to high? Do you use cheap product that people may not want? Do you offer a service that too many others offer? Is there TRULY a market for your product? Is your product the same old thing with a different company selling it? How is your exposure? Do people know your business exists? Do you have little operating finances? Do you adequately market your company? Do you provide a professional image? Would any person take your business seriously?
Opportunity: Where are your opportunities to make your business work? Is there a local demand for a product with scarce supply? Is it a new innovative product that people will want and the competition doesn't have (If competition exists.)? Were new laws just recently passed that makes your product or service legal that the competition, or potential competition, hasn't capitalized on?
Threat: Is there a snake in the grass? Are there any threats that could potentially harm or dismantle your business? Is a prohibition going into effect? Better not start a liquor store. Is there a huge company that could easily run you out of business (The proverbial Wal-Mart of your industry.)? Are you your threat? Do you have little operating capital? Will you be able to sustain your business for 6 months to a year without making a dime? Are you mentally capable of handling a year of being in business without making a dime (This is very common, especially in e-commerce)?
What is SWOT? SWOT is an Acronym that means Strength.Weakness.Opportunity.Threat. What does each of those mean?
Strength: The points of your business that are strong. Do you have a very unique product? Do you have a lot of finances to fund your business? Do you have a really good marketing campaign? What differentiates you from your competition? Are you able to deliver worldwide while your competition can only fulfill the local demand? Or maybe your strength is that you ARE a small business and you can provide the personalized solution that your customers may require.
Weakness: This is where you must truly be honest with yourself. Are your prices to high? Do you use cheap product that people may not want? Do you offer a service that too many others offer? Is there TRULY a market for your product? Is your product the same old thing with a different company selling it? How is your exposure? Do people know your business exists? Do you have little operating finances? Do you adequately market your company? Do you provide a professional image? Would any person take your business seriously?
Opportunity: Where are your opportunities to make your business work? Is there a local demand for a product with scarce supply? Is it a new innovative product that people will want and the competition doesn't have (If competition exists.)? Were new laws just recently passed that makes your product or service legal that the competition, or potential competition, hasn't capitalized on?
Threat: Is there a snake in the grass? Are there any threats that could potentially harm or dismantle your business? Is a prohibition going into effect? Better not start a liquor store. Is there a huge company that could easily run you out of business (The proverbial Wal-Mart of your industry.)? Are you your threat? Do you have little operating capital? Will you be able to sustain your business for 6 months to a year without making a dime? Are you mentally capable of handling a year of being in business without making a dime (This is very common, especially in e-commerce)?
Welcome to the Small Business Blog
Hello and thank you for reading the Small Business Blog. This blog is completely dedicated to small businesses and their questions. While it is a huge commitment to start a business and can be scary at times; it can also be a hugely rewarding experience. I currently own a small business and I take many business related classes and courses. I'm well versed in e-business, and I greatly enjoy international business. I look forward to seeing everyone's interaction, ideas, and efforts.
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