How to Combat External Forces Working against Your Business

April 13, 2011


In the previous post we highlighted external market forces that can drive you out of business if you are not careful. The changes in economy, competition and consumer habits have hurt many small business owners in the last few years and can bring down sales and profit for your small business too.
To be fair, these external forces impact both large and small business alike; however small business owners feel this impact in a more profound way. Also, the small business owners can feel the impact very quickly. After all, unlike large businesses they do not have large financial cushion to withstand the impact. They also have their personal and business lives intertwined with the business. This will make it hard not for themselves; but also for others around them, including spouse, children and friends.
How can small business owners prepare themselves to be able to withstand the impact better than their peers?
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Why Embracing KISS Principle Leads to Happiness

April 6, 2011


KISS -Keep It Simple Stupid.
Many small business owners like to take the road less simple. If a task takes 2 steps to finish they will manage to stretch it to 10 steps. They are wired to think complex. We have pondered on the question for some time – when you are running a small business should you opt for a simple operation or a complex one?
You can see the examples of simple and complex operations in franchises as well. On one hand you have a pizza franchise such as Little Caesar’s – home of $5 Pepperoni Pizza with no delivery. On other side there is Pizza Hut with large number menu items and toppings and it not only has carry out; but also delivery and dine-in. Which one is easier operation to run?
There are number of reasons why you should try to keep things as simple as possible.
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Improve Sales and Customer Loyalty with Subscription Model

April 2, 2011


Many people incorrectly assume that the subscription model only applies to specific types of business and miss out on the benefits it provides. The business that is closely associated with subscription model is newspapers and magazines. After all, magazine industry was the first one to introduce subscription business model. A number of other industries have since adopted this model including health clubs, DVD rental (Netflix), cell phone companies, etc.
The subscription model creates a win-win opportunity for both business owners and customers. Businesses benefit from subscription model because they get guaranteed sales. In some cases, they also get advanced payment for the services that customers will enjoy over a period in the future. Subscription model also builds a customer loyalty and reduces the marketing / customer acquisition cost for small business owners.
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How can You Get Past Customers Back

March 27, 2011


In spite of all your efforts to hold onto existing customers you are bound to lose some of them over time. There are variety of reasons they leave. Some are under your control; while others are not. Some customers leave because they received bad service. Others become tired of same products they are getting. Still others leave because you have not been in front of them through marketing.
While you will not be able keep every single customer all the time what you can do is try to bring those customers who have left some time ago. Depending on their reasons for leaving; this may be somewhat easier to do than trying to acquire the customers who have never tried your products.
So what can you do to make this happen? Below we have highlighted several techniques you can use.
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How Can your Employees Help Improve Sales

March 16, 2011


It is our belief that your employees can help improve sales at your business by more than 20% if you help them help you. Most business owners don’t really think of their employees as ones who can help them improve sales; however the front line employees – the ones that interact with customers – can make a big difference in improving your business. These employees are talking to and interacting with your customers all the time. They are responsible for making your customers come back by providing great customer service. In short, they are representing your brand and your business.
So what are the specific ways in which your employees can help improve sales? In our experience of running business for 5 years we have come across multiple opportunities.

  1. They can make your existing customers come back by providing excellence customer service.
  2. They can also help bring new customers by word-of-mouth from existing ones.
  3. They can help you up-sell and cross-sell at the point of order taking and payment.
  4. They are aware of where opportunities exist for improvement in customer service and operations.

It is your responsibility as business owner to make this happen. You have to provide them with the necessary resources and incentives that will motivate them to give their best in front of customers. We have identified below several areas that you need to address.
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How to Ask Customers to do Marketing of your Business

March 9, 2011


Most small business owners are at a disadvantage compared to their large competitors when it comes to marketing. After all, small businesses do not have the marketing muscle and budget of the large companies. They have to find innovative ways to do marketing and advertising that is not expensive yet is equally, if not more, effective.
Many small business owners get intimated by this challenge and think that there is no way they can succeed against Goliath in marketing. We believe that is not true. In our earlier post on 5 fundamental rules of marketing we argued that good marketing strategy does not have to cost much. We also showed how you can improve your sales in a low-cost fashion through community involvement. There is another aspect of low cost marketing that is not utilized well by small business owners. That involves seeking help from your existing customers to do the marketing for you.
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Improve your Sales with Up Selling

March 6, 2011


“Would you like fries with that?” – We have all heard this while ordering burger at a fast food place. How many times have you answered it with – “sure”? Well, this is the power of up selling. In its simplest form, it is just a matter of asking customers if they want to add more items to their order. In a more subtle form, it could be something like placing a complementary item to the one that you intend to purchase in a grocery store and enticing you to buy it.
If you are not taking advantage of up selling and cross selling opportunity in your business you are probably losing 20-30% of potential sales. Some companies have really mastered the techniques of up selling by making customers buy additional items at a high price. For example, Ford has increased the average selling price of its cars by making customers want and pay for the extra options in their basic cars. When Apple introduced its next generation of iPad on March 3 it also showed a screen cover that will be sold for $39 for basic model and $69 for leather version. Can you imagine what their profit margin is on these items?
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Improve Sales by Helping Customers Make Choice

February 23, 2011


Every one of us has been to a soup isle in the grocery store at some point. Have you noticed the number of choices they have for sale? There are endless shelves stocked with soups from different companies in myriad variations. Just imagine having to make a decision on what soup to get – Campbell or Progresso, ready-to-eat or condensed, Mushroom or Minestrone, low salt minestrone or regular or high fiber and on and on. Is your head spinning yet?
Psychology professor Barry Schwartz makes good arguments in his book The Paradox of Choice: Why more is less on why you sell less when you provide customers too many choices. When customers cannot make up their minds on what to get they will simply just walk away without making any purchase.
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Proven Techniques to Deal with Customer Complaints

February 21, 2011


For small business owners (and for large ones too) customer complaints is a fact of life. Every business runs into few customers who are not happy with the service or product or something else. The complaints in and of themselves are not going to hurt your business much. It is how you deal with them that determines how they will impact your future business.
We have heard many business owners say – “but I know that this customer is wrong. He/she is just trying to get free stuff or get discount by complaining and making a scene.” And they may be right; but does it really matter who is right or who is wrong? At the end of the day, it is about who has the power to hurt your future business. It is these customers who are complaining – genuine or sham.
So, is there anything you, as a small business owner, can do to alleviate this problem? Obviously, you cannot stop customers from complaining; although you can reduce the number of genuine complaints by providing excellent products and services. Based on our experience in running multiple restaurants we have come up with these guidelines to deal with customer complaints and mitigate their impact on the business.
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Best Ways to deal with an Irate Customer

November 21, 2010


Post from Guest Contributor Chris Blanton, editor of Ingenious Business Guide.
Do you remember the last time you were frustrated while making a purchase? Maybe you were talking with an unintelligible company’s customer service rep on the telephone. Or maybe a retail clerk was arguing with you. Perhaps a returns department refused your refund because you had lost the receipt. Regardless why you were upset, you wanted two things: someone to solve the problem, and a sincere apology for being disrespected.
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Filed Under: Customers, Management, Operations