SCORE counselor, Abraham Cohen, offers his perspective for those considering a start up consulting or freelance business
With unemployment rates close to 10%, more Americans are looking into consulting or freelancing, having given up on the salaried 9 to 5 world. Here are a few tips for those considering going that direction:
• Commit for the long term: You may see this as a temporary situation; odds are you are wrong; you may be in for the long haul. See it as a job, an investment requiring time and thought. Print business cards, set up a basic website, establish a new cell phone number for your business and make a list of your contacts.
• Use and update your skills: Your expertise and skills, too expensive or infrequently used for companies to keep in house, are your assets. Implementing new software or temporary graphic designs demand greater salaries; firms find it more efficient to hire your talent short term. Keeping your skills fresh is vital, an upper hand on competition. Attend workshops and training courses to maintain your cutting edge expertise. Teaching at regional schools, colleges or workshops will look good on your résumé. It will provide some income and a great way to network and get leads to new clients. Teaching also forces you to keep up with the latest advancements in your professional field.
• Networking: Join a network or community of consultants, giving you an important source of new clients. You can share work with fellow consultants for bigger projects that require more hands. Forming a team that works as a firm is a possibility. And, keeping referrals within the group will create a flow of work.
• Your own space: Find a work space away from home. Clients want a level of professionalism when dealing with you. Sharing an office with a group provides quiet space and a desk to call your own. A receptionist service will answer your calls and keep schedules.
• You need to have a business plan: This is the most important ingredient for success. A business plan and mission statement will help decide what jobs to take. Get known for what you do best; taking anything that comes along will brand you “non-specialist.” Organize the business, use software to track billing and expenses and, most important, keep your personal and business finances separate. Steer your business toward your goals.
Richard Strug
Greater princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, April 27, 2010
What role does my business plan play after I'm up and running?
Starting a small business requires extensive planning and research. But just because things are up and running doesn’t mean your days as a strategist are done. In fact, they are just beginning.
Planning is an ongoing necessity because the environment in which your small business operates continually changes. New opportunities and challenges will arise that are different than those assessed during the start-up stage. Your initial financial projections may be literally and figuratively on the money—or trending in a different and unexpected direction.
Here are some planning tips to help keep your small business on track for long-term growth:
Revisit your business plan. Your business plan shouldn’t become a “trophy” of your start-up success. Refer to it every quarter or six months to match estimates with current realities. Update your plan as needed with new or modified contingencies, and adjusted time frames for key milestones such as expansions or new product/service lines.
Watch those numbers. Financial statements provide a window into the health of your business. Project cash flow several months into the future based on reasonable expectations for sales and income, customer demand, regular payments (e.g. loans and rent), and other factors. By comparing actual cash flow to projections, you can spot opportunities to improve performance.
Watch your industry. In today’s interconnected global economy, any change anywhere can have a ripple effect on any small business. The influences may be as far-reaching as a shift in demand for a certain commodity, or as local as a new stoplight near your store. Stay current with world and community events; study your sales records; and communicate with customers, suppliers, and colleagues. You’ll be less susceptible to surprises, and better prepared to anticipate and capitalize on these changes.
Develop relationships. Although growth usually implies investing in additional resources, there may be more cost-effective options better suited to your immediate and long-term needs. Building partnerships with other businesses in your field and specialty consultants can help stretch your capabilities. They may also call on you when they need help—perhaps during a period when you have time or capacity to spare.
Invest in your staff. Because a growing business will demand more of your time, identify employees who can take on routine and management responsibilities. They’ll relish the opportunity to grow personally and professionally, and you’ll be free to focus on more important issues.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Planning is an ongoing necessity because the environment in which your small business operates continually changes. New opportunities and challenges will arise that are different than those assessed during the start-up stage. Your initial financial projections may be literally and figuratively on the money—or trending in a different and unexpected direction.
Here are some planning tips to help keep your small business on track for long-term growth:
Revisit your business plan. Your business plan shouldn’t become a “trophy” of your start-up success. Refer to it every quarter or six months to match estimates with current realities. Update your plan as needed with new or modified contingencies, and adjusted time frames for key milestones such as expansions or new product/service lines.
Watch those numbers. Financial statements provide a window into the health of your business. Project cash flow several months into the future based on reasonable expectations for sales and income, customer demand, regular payments (e.g. loans and rent), and other factors. By comparing actual cash flow to projections, you can spot opportunities to improve performance.
Watch your industry. In today’s interconnected global economy, any change anywhere can have a ripple effect on any small business. The influences may be as far-reaching as a shift in demand for a certain commodity, or as local as a new stoplight near your store. Stay current with world and community events; study your sales records; and communicate with customers, suppliers, and colleagues. You’ll be less susceptible to surprises, and better prepared to anticipate and capitalize on these changes.
Develop relationships. Although growth usually implies investing in additional resources, there may be more cost-effective options better suited to your immediate and long-term needs. Building partnerships with other businesses in your field and specialty consultants can help stretch your capabilities. They may also call on you when they need help—perhaps during a period when you have time or capacity to spare.
Invest in your staff. Because a growing business will demand more of your time, identify employees who can take on routine and management responsibilities. They’ll relish the opportunity to grow personally and professionally, and you’ll be free to focus on more important issues.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, April 13, 2010
How effective are marketing "tag lines"?
Alan Yarnoff, SCORE counselor and former advertising executive, looks at the importance of an effective tag line for your service or product.
“With all the effort small business owners and managers put into creating websites, online advertising, and newspaper and radio ads, they sometimes overlook the most important ad they need to create: the company’s or product’s tag line. A tag line is best defined as a short phrase that tells your audience what you offer in a memorable fashion and should never be taken as an after thought.
An effective tag line is the true first step and an integral part of brand building. No matter what your company does, your tag line creates a first and lasting impression to your projected target audience and should not be ignored.
Effective tag lines are terse, “Just do it;” they make a promise, “Bayer works wonders;” or they can suggest the risk of not using the product, “It’s gotta be clean, it’s gotta be Tide.”
To get you started, here are some tips on how you can create a winning tag line for your business. Start by defining the key factors of your product or service. What features are truly different and how do they translate into a real benefit for the customer. Once this is done, you need to translate the findings into an evocative and inspiring call to action.
First, keep it short - more than one line becomes tedious. Second, be descriptive - this can be difficult to do in a few words but it is very important. The tag line that describes the core benefit of the product and what truly sets it apart will be successful. Third, stay within the brand - the tag line must fit in and compliment your brand, not stand apart from it. Lastly, be relentless - the challenge of creating an effective tag line is not an easy task and will not come quickly. Use all your resources, give it time, and eventually you will find it.
We all know how difficult the current market situation is and we must do everything possible to build and maintain our customer base. No part of your promotional program can be over looked, especially something as important as an effective and meaningful tag line. So get to work today and devise the words that will define your business and create a memorable and lasting impression for your customers.
The Ask SCORE column needs a tag line. The winner’s name will appear in the first article that uses it. Send your ideas to my attention at info@scoreprinceton.org.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
“With all the effort small business owners and managers put into creating websites, online advertising, and newspaper and radio ads, they sometimes overlook the most important ad they need to create: the company’s or product’s tag line. A tag line is best defined as a short phrase that tells your audience what you offer in a memorable fashion and should never be taken as an after thought.
An effective tag line is the true first step and an integral part of brand building. No matter what your company does, your tag line creates a first and lasting impression to your projected target audience and should not be ignored.
Effective tag lines are terse, “Just do it;” they make a promise, “Bayer works wonders;” or they can suggest the risk of not using the product, “It’s gotta be clean, it’s gotta be Tide.”
To get you started, here are some tips on how you can create a winning tag line for your business. Start by defining the key factors of your product or service. What features are truly different and how do they translate into a real benefit for the customer. Once this is done, you need to translate the findings into an evocative and inspiring call to action.
First, keep it short - more than one line becomes tedious. Second, be descriptive - this can be difficult to do in a few words but it is very important. The tag line that describes the core benefit of the product and what truly sets it apart will be successful. Third, stay within the brand - the tag line must fit in and compliment your brand, not stand apart from it. Lastly, be relentless - the challenge of creating an effective tag line is not an easy task and will not come quickly. Use all your resources, give it time, and eventually you will find it.
We all know how difficult the current market situation is and we must do everything possible to build and maintain our customer base. No part of your promotional program can be over looked, especially something as important as an effective and meaningful tag line. So get to work today and devise the words that will define your business and create a memorable and lasting impression for your customers.
The Ask SCORE column needs a tag line. The winner’s name will appear in the first article that uses it. Send your ideas to my attention at info@scoreprinceton.org.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, April 6, 2010
Where should a company owner focus his/her time?
“Just wait ‘til I’m the boss…”
That sentiment has helped sustain many aspiring entrepreneurs through the process of getting their small businesses up and running. Among the many benefits of small business ownership is the opportunity to do things “the right way” when it comes to employees and customers.
Once in charge, however, many small business owners find that leading, managing, and motivating others involved with the business aren’t as easy as they sound. One reason is widespread confusion about the difference between “managing” and “leading.” Leadership experts say they are two very different roles, even though most small business owners consider them the same.
“Managing” implies structure, control, rules, deadlines and efficiency, says Ken Blanchard, best-selling author of The One Minute Manager. But according to Blanchard, “leadership” is nearly the opposite of “management.” Leading requires actions that are more experimental, unstructured, visionary, flexible and passionate. Managers and leaders think and behave differently.
Blanchard and his partner Drea Zigarmi spent seven years studying how business leaders exert influence and how their values, beliefs and personalities contribute to their success—or failure. Through it all, one finding was clear: A one-size-fits-all style of leadership does not exist.
Owning a business automatically puts you in a position of leadership. Your goal is to engage employees, partners, vendors, investors, independent contractors or other participants in your venture in a course of action that helps achieve a mutually shared vision. But being in a leadership position does not necessarily make you a leader.
Many entrepreneurs turn to management techniques to enlist the minds and muscles of the people they lead, but fail to capture an equally important component—their hearts. If you merely work to focus activities of followers and fail to engage them in a purpose, you won’t likely be seen as a good leader.
“The first step to becoming a better leader is to study yourself and get honest, unfiltered feedback about how you are doing from the people you lead,” says Blanchard. “You cannot effectively lead if you do not know your own values.”
Learning when and how to provide direction (defining roles, setting goals and priorities, scheduling, and evaluating results), and support (seeking input, listening, offering praise and encouragement, sharing information, explaining decisions, and helping others solve problems) is an ongoing process for even veteran small business owners. Employees, vendors, and customers all change; you need to make your leadership skills flexible as well.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
That sentiment has helped sustain many aspiring entrepreneurs through the process of getting their small businesses up and running. Among the many benefits of small business ownership is the opportunity to do things “the right way” when it comes to employees and customers.
Once in charge, however, many small business owners find that leading, managing, and motivating others involved with the business aren’t as easy as they sound. One reason is widespread confusion about the difference between “managing” and “leading.” Leadership experts say they are two very different roles, even though most small business owners consider them the same.
“Managing” implies structure, control, rules, deadlines and efficiency, says Ken Blanchard, best-selling author of The One Minute Manager. But according to Blanchard, “leadership” is nearly the opposite of “management.” Leading requires actions that are more experimental, unstructured, visionary, flexible and passionate. Managers and leaders think and behave differently.
Blanchard and his partner Drea Zigarmi spent seven years studying how business leaders exert influence and how their values, beliefs and personalities contribute to their success—or failure. Through it all, one finding was clear: A one-size-fits-all style of leadership does not exist.
Owning a business automatically puts you in a position of leadership. Your goal is to engage employees, partners, vendors, investors, independent contractors or other participants in your venture in a course of action that helps achieve a mutually shared vision. But being in a leadership position does not necessarily make you a leader.
Many entrepreneurs turn to management techniques to enlist the minds and muscles of the people they lead, but fail to capture an equally important component—their hearts. If you merely work to focus activities of followers and fail to engage them in a purpose, you won’t likely be seen as a good leader.
“The first step to becoming a better leader is to study yourself and get honest, unfiltered feedback about how you are doing from the people you lead,” says Blanchard. “You cannot effectively lead if you do not know your own values.”
Learning when and how to provide direction (defining roles, setting goals and priorities, scheduling, and evaluating results), and support (seeking input, listening, offering praise and encouragement, sharing information, explaining decisions, and helping others solve problems) is an ongoing process for even veteran small business owners. Employees, vendors, and customers all change; you need to make your leadership skills flexible as well.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, March 23, 2010
How can I maximize my advertising dollar?
Even on a limited budget, every retail business must advertise to keep new customers coming in the door. Co-promotions and cooperative advertising are two approaches to maximizing the value of your advertising dollars by sharing the costs. The supplier (typically a manufacturer or distributor) benefits because its product gains greater exposure at the same time its sales are increasing.
Co-promotion may be an option if you can split your ad costs with another local business serving your same target audience. Those costs could include sponsorships, ads, newsletters, fliers and bill stuffers. You may identify one or more vendors who are willing to share the cost of a trade show booth as well as the printed materials and staffing required for the booth.
With cooperative advertising (also known as co-op advertising), two or more parties are sharing certain ad costs. This arrangement may take the form of an incentive program, with manufacturers contributing dollars to the ad campaigns of distributors or retailers to encourage the promotion of certain products.
Suppliers who participate in co-op advertising programs usually give the retailer credits for purchasing their products or services. Those advertising credits can amount to 3 percent to 5 percent of the total purchase. The credits can be redeemed when the business owner buys advertising that the supplier approves. Often Yellow Pages advertising qualifies for co-op money.
The supplier sets the guidelines. Usually the ads eligible for co-op dollars feature the supplier’s brand exclusively. In addition the supplier may have to sign off on the ad and the chosen medium being used if not also the frequency. Sometimes suppliers have ad copy or scripts that must be used to qualify for a reimbursement. If not, the supplier probably will want to approve of the ad before it runs. Remember, however, that the ad should feature your business prominently in addition to playing up the product.
How do you get reimbursed for co-op advertising? There are two approaches. You may have to pay for the ad up front and then give the supplier a copy of the ad. For radio or TV ads, you’ll probably need to show the script and proof of the dates and times the ads were aired. Some suppliers, however, may issue credits that equate to their agreed-upon share of the advertising. Then the business owner can make future purchases from the supplier at a discount.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Co-promotion may be an option if you can split your ad costs with another local business serving your same target audience. Those costs could include sponsorships, ads, newsletters, fliers and bill stuffers. You may identify one or more vendors who are willing to share the cost of a trade show booth as well as the printed materials and staffing required for the booth.
With cooperative advertising (also known as co-op advertising), two or more parties are sharing certain ad costs. This arrangement may take the form of an incentive program, with manufacturers contributing dollars to the ad campaigns of distributors or retailers to encourage the promotion of certain products.
Suppliers who participate in co-op advertising programs usually give the retailer credits for purchasing their products or services. Those advertising credits can amount to 3 percent to 5 percent of the total purchase. The credits can be redeemed when the business owner buys advertising that the supplier approves. Often Yellow Pages advertising qualifies for co-op money.
The supplier sets the guidelines. Usually the ads eligible for co-op dollars feature the supplier’s brand exclusively. In addition the supplier may have to sign off on the ad and the chosen medium being used if not also the frequency. Sometimes suppliers have ad copy or scripts that must be used to qualify for a reimbursement. If not, the supplier probably will want to approve of the ad before it runs. Remember, however, that the ad should feature your business prominently in addition to playing up the product.
How do you get reimbursed for co-op advertising? There are two approaches. You may have to pay for the ad up front and then give the supplier a copy of the ad. For radio or TV ads, you’ll probably need to show the script and proof of the dates and times the ads were aired. Some suppliers, however, may issue credits that equate to their agreed-upon share of the advertising. Then the business owner can make future purchases from the supplier at a discount.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, March 16, 2010
How can networking help my business?
SCORE counselor, Alan Yarnoff, shares his fifth article with us, this time, on the subject of networking.
“In this difficult economic period, it may be time to look at your current networking process and begin to think more “out of the box.” Now is not the time to rely on the common networking practices like handing out business cards, attending meetings, and joining local chambers of commerce because these tactics will only go so far. You need to become more proactive since the same old tactics may have reached the point of diminishing returns.
One of the real problems is that most people believe that networking consists of telling as many people as possible about yourself or your business, rather than the real objective: which is to find out as much as you can about the potential prospect you are networking with. It is important that the initial conversation focus on understanding your prospects problems, needs, concerns, and getting solid contact information. With this in hand, you can determine whether they would have an interest in the product or services you provide.
If the answer is yes, it’s time to get to work and follow up the initial contact within an actionable way. People have short memories; it is incumbent upon you to remind them that you are the one that can solve their unmet business needs. Send a letter or email with suggestions they could use right away, send samples of your products, or articles you have written that would be useful in building their business. Most important keep the pressure on until either you get the new client or are asked to stop.
Another way to expand your network is to speak to local groups, organizations, and associations about your field of expertise. The object is to transform your experience into an informative concise and entertaining presentation to help the audience improve their business. Position yourself as an expert and validate your credibility in the local business community.
Lastly you may consider creating a blog for your business. The blog offers you a valuable tool to stimulate a personal dialogue with potential customers and a great way to let your current clients know what’s new with your business.”
Good luck and good networking.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
“In this difficult economic period, it may be time to look at your current networking process and begin to think more “out of the box.” Now is not the time to rely on the common networking practices like handing out business cards, attending meetings, and joining local chambers of commerce because these tactics will only go so far. You need to become more proactive since the same old tactics may have reached the point of diminishing returns.
One of the real problems is that most people believe that networking consists of telling as many people as possible about yourself or your business, rather than the real objective: which is to find out as much as you can about the potential prospect you are networking with. It is important that the initial conversation focus on understanding your prospects problems, needs, concerns, and getting solid contact information. With this in hand, you can determine whether they would have an interest in the product or services you provide.
If the answer is yes, it’s time to get to work and follow up the initial contact within an actionable way. People have short memories; it is incumbent upon you to remind them that you are the one that can solve their unmet business needs. Send a letter or email with suggestions they could use right away, send samples of your products, or articles you have written that would be useful in building their business. Most important keep the pressure on until either you get the new client or are asked to stop.
Another way to expand your network is to speak to local groups, organizations, and associations about your field of expertise. The object is to transform your experience into an informative concise and entertaining presentation to help the audience improve their business. Position yourself as an expert and validate your credibility in the local business community.
Lastly you may consider creating a blog for your business. The blog offers you a valuable tool to stimulate a personal dialogue with potential customers and a great way to let your current clients know what’s new with your business.”
Good luck and good networking.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, March 9, 2010
How do I manage cash flow?
Just as watching your blood pressure is important to your personal health, monitoring cash flow is vital to the well-being of your business. Minor “hiccups” may be expected, but they can also be an early warning of bigger, potentially chronic problems ahead, especially if other indicators such as sales seem positive.
Though critically important, monitoring and predicting cash flow is actually a matter of consistently following some simple, common-sense financial management practices.
The object is to make certain that more cash enters your business than exits your bank account. First you need to translate sales into real money as quickly as possible. Once you’ve collected the cash, your business needs to guard it. Surprises, such as slow or non-paying customers and unexpected expenses, are your worst cash flow enemies.
One way to shift cash your way is to ask for all or a portion of payment up front. Asking for at least a deposit in advance is a great way to jump-start your cash flow. And if you establish the policy fairly and properly, it shouldn’t alienate good customers.
Accepting credit card payments also can help, so you may want to sign up for a merchant account that allows you to do this. Or, if you already have one, encourage customers to use this option more often. You do pay a fee for this. But credit cards are a great way to speed cash into your account, and the cost is generally small.
You may need to manage “receivables” more closely. This is the money that customers owe to you for products or services you’ve delivered. Create a detailed “aging” schedule of what you are owed, by whom and for how long. Place phone calls to overdue accounts, focusing first on the largest amounts due. Offering a discount can bring some quick cash in the door, but play this card only after you’ve called the customer to ask for full payment.
Finally, don’t overlook the power of an operating budget. Note specific due dates for payables as well as receivables, and regularly use it to get a “snapshot” of your cash flow status. With that information, you’ll be better able to make short- and long-term plans, spot potential problems, and avoid potentially crippling cash crises.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Though critically important, monitoring and predicting cash flow is actually a matter of consistently following some simple, common-sense financial management practices.
The object is to make certain that more cash enters your business than exits your bank account. First you need to translate sales into real money as quickly as possible. Once you’ve collected the cash, your business needs to guard it. Surprises, such as slow or non-paying customers and unexpected expenses, are your worst cash flow enemies.
One way to shift cash your way is to ask for all or a portion of payment up front. Asking for at least a deposit in advance is a great way to jump-start your cash flow. And if you establish the policy fairly and properly, it shouldn’t alienate good customers.
Accepting credit card payments also can help, so you may want to sign up for a merchant account that allows you to do this. Or, if you already have one, encourage customers to use this option more often. You do pay a fee for this. But credit cards are a great way to speed cash into your account, and the cost is generally small.
You may need to manage “receivables” more closely. This is the money that customers owe to you for products or services you’ve delivered. Create a detailed “aging” schedule of what you are owed, by whom and for how long. Place phone calls to overdue accounts, focusing first on the largest amounts due. Offering a discount can bring some quick cash in the door, but play this card only after you’ve called the customer to ask for full payment.
Finally, don’t overlook the power of an operating budget. Note specific due dates for payables as well as receivables, and regularly use it to get a “snapshot” of your cash flow status. With that information, you’ll be better able to make short- and long-term plans, spot potential problems, and avoid potentially crippling cash crises.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
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