Inside Small Business | Small Business & Home Business Marketing
Archive for May, 2008
Tracking Performance
It is always important for us to track performance regardless of the task. We watch overall gross income performance, profit and loss, inventory costs, expenses, and all sorts of other performance indicators. We also watch job performance. We track tasks like phone orders taken per person, number of customer service emails sent, and number of web site updates made. It’s extremely useful to know what jobs are being done and how efficiently they’re being performed.
There are drawbacks to all this tracking though, and I didn’t understand much of it at first. I’m still learning too, but I’ll mention a couple of lessons that I learned here. For instance, I had to learn to really analyze the numbers to get the whole story. We started tracking our shipping workers’ numbers so that we would know how many packages they ship out per day per person. Sometimes a shipping worker’s numbers would be far lower one day. They might have been taking inventory or working on something still important, but not related to the single number we were watching. It was a problem. We’ve since learned to judge performance based on a number of factors, not just one.
Another issue with performance tracking is deciding how much information to provide to employees. The whole objective is to improve performance by tracking it, not to create contests or destroy quality in a wild dash for higher numbers. I’ve found that it’s best to track and privately review performance with employees instead of having the performance numbers sitting out there for all to see. We’re also trying to avoid the phenomenon where an employee hits their usual satisfactory target number and then slows down for the rest of the day.
It’s difficult to know what performance benchmarks to track and how. Every company is different and I won’t assume that your company works just like mine. I do think that performance tracking is valuable and necessary, but figuring out how is completely up to you.
What’s in a Name?
I don’t remember exactly when the name Alice emerged as the winner. I know I put friends through tedious brainstorming. I know at one point I decided it should be a proper name rather than a “beauty” phrase, and I recall deciding to use “cosmetics” rather than “mineral makeup” because I didn’t want to limit myself, even though using the phrase “mineral makeup” would have worked better vis à vis the search engines. Thousands of women search for mineral makeup each day on the internet, and the numbers are growing . . . pray the numbers keep growing!
My funny and indomitable mother was named Gertrude Alice Keebler. Of course she hated that. So she set about changing her identity and became Kay (for Keebler, her last name). I’ve always admired her for that – to be a young woman in the 1930’s and make such an assertion stick was no minor accomplishment.
Though happily known as Kay by friends and family all her life, she did concede a bit to officialdom by signing checks and other legal documents as G. Alice Keebler, then after marriage, G. Alice Gray. When choosing her headstone, her heirs felt a moment’s indecision, but in the end, we opted for what we knew she would want, G. Alice Gray.
So what about Alice? A perfectly nice though under-used name. An accessible, welcoming name. A name that took second place to an initial! Alice it was.
Of course there is that other Alice—the one created by Lewis Carroll in 1865 and the one I studied as a graduate student in Oxford once upon a time. Clearly books for adults as well as children, Alice in Wonderland and Through the Looking Glass are classics along with their beloved namesake. Carroll’s Alice is always curious, always adventurous, always undaunted.
Not a bad thing to hitch our wagon to her star, linking our search for beauty as we age gracefully with her enchanted travels through the looking glass.
Outsourcing Woes
Outsourcing the tasks or things in your business that you are not very good at or that are just too time consuming is a great idea. Most of the time this can be an awesome decision and can free up valuable time and energy to pour into the important things like generating new business and customer satisfaction.
Though I am great with photography, I am not much of a web designer. I even took classes on HTML and Flash in college but found it incredibly time consuming and couldn’t personally translate the “numbers and letters” of HTML into photos, colors, and design elements. In comes my web designer specific for the photographer’s needs! They do all the design but I can customize the sight on a daily basis by changing text, photos, and colors whenever I want! It’s been really great…until this week! This week I was informed that my site was accidentally deleted along with all the photos and info as it was being transfered over to a new server. What!? All gone?! I have to start from scratch at the beginning the summer wedding season?! Yep. The positive spin on it is that I will get a shiny new updated website with all the bells and whistles with great customer service!
I was frustrated at first because I am thinking of all the hours of work that will have to go into this remodel that I wasn’t really looking to do right now. In truth, it will probably be really good for my branding. I had a website before I had a clear brand. Now that my brand is better understood and established (with the help of Logo Works!) I will be able to design my site more specifically around it. Hopefully you’ll be able to check out the new and improved site before the end of this month!
Jason
Learning to Give Responsibilities to Others
Being a (very) small business owner, I’ve experienced a trend over and over again that never seems to get easier: giving up responsibilities, duties, and decision making to employees.
When we started eReplacementParts.com every responsibility fell directly on the owner’s shoulders. We were in charge of building the site, writing all the content, taking all the orders, and shipping all the tool parts. Just from talking to other small business owners I know, it seems that lots of companies start this way. Perhaps yours did as well. Maybe it still operates that way.
For us right now, growth is our focus. We work hard to sell as many parts as we can and not be content with simply maintaining sales levels. As we grow, we need more people to make the company work and that means I have to give some, and then eventually most, of my responsibilities to others. To be honest, it’s tough to let go. Now we have entire departments dedicated to shipping our packages, taking customer phone calls, and building the website. When I walk through our building, I pass many people and their jobs used to be my job. I took a lot of pride in doing those jobs and it’s hard to really let go and trust that my employees will handle things as well as I did. And while they’re not clones of me, they’re able to handle their individual responsibilities just as well as I can and they’re far more specialized.
I think giving up responsibility is a tough thing for any business owner. For some small companies, the goal is to maintain size and perhaps the owner prefers to retain a large share of the load. That’s fine, but I believe that a small business will remain a small business as long as the owner is the primary worker. Potential is limited. If the goal is to grow, a business owner must give up some responsibilities to employees so that he/she can focus more on the company itself.
Product Development
Sampling gorgeous eye shadow colors, what could be more fun for a makeup addict? Looking back, I have to laugh. I remember telling friends that my red eyes were caused by allergies.
But pulling together a coherent line of private label cosmetics and accessories proved to be a monumentally detailed and challenging task, one that took many hours of sampling, testing, budgeting, rebudgeting, and keeping an eye on the big picture. Foundation, eye colors, concealers. Brushes and bronzers and blush, oh my!
For months I sampled cleansers, toners and moisturizers and the jars and bottles to hold them. At one point, I settled on a lovely bottle with gold trim for my toner, only to realize that the minimum order was 5,000 units—a tad beyond even my Scenario C budget. There were many learning experiences in this process, and like, perhaps, many small business owners and their product offerings, I had not done anything quite like it before.
At some point I realized I needed to set some boundaries around exactly what it was I was going to sell. Taking the entire skin care component out of the picture and saving it for some future rollout was a decision that eased the budget and the psyche.
Another learning experience but much greater setback was yet to come. Once I had settled on all the colors of mineral makeup for my line, I ordered quarter pounds of a half dozen of them to start experimenting with filling sample jars and trying out sifters and types of labeling. When the wrong formula arrived, my wholesaler was surly and uncooperative, and I did not want to run into that situation again. I learned from that that I needed to put my faith in more than just one main supplier, and I had to start the process of testing and sampling all over again.
Today, my line of mineral makeup consists of 53 shades in all. I order the colors from three separate suppliers, the accessories from two, the jars and lids and sifters from several, and the labels and the custom brushes from two others. Ultimately it all fell into place, but not without blood, sweat, and allergy eyes.
How Can I Get the Media Involved?
Since Day Dreamin’ Exotics is a start-up company with limited resources for advertising, we have tried to use creative techniques to generate interest from local media personalities. This can be very difficult, as some of the television and radio personalities view themselves as celebrities rather than media personnel.
We have used our cars to create interest in our product. We were able to take the Aston Martin and Viper to the Utah Jazz Playoff game this week. The Jazz charge several thousand dollars to park a car on the plaza and show them off. Because we do a small amount of advertising with KFAN, the local radio station that broadcasts the games, we were able to put our cars in their space with a KFAN sticker displayed. It made KFAN look great and we got our cars on the plaza for free.
We turned to guerilla marketing and a free Tour give away to increase the hype. Every news team in town was on the plaza broadcasting live. We were the perfect backdrop for several hits. I spoke with a number of the anchors during the evening. One in particular is a car guy and has a huge interest in Day Dreamin’. Not only does he want to do the tour himself, but also his producer called me the next day to arrange a short segment for the news.
Not every new business can boast $600,000 worth of exotic cars, but try to find a way to generate interest for the media. Try to find something newsworthy. If you can get one or two people in the media excited and involved, it can produce thousands of dollars in free publicity.
The Tyranny of the Urgent
Wow! I just got a reminder today about what should be important about running a small business. Making our clients happy!
Instead - I got a lesson in marketplace competition (where I was on the losing end).
Here’s the situation: I had a client that had an open job posting for a project manager. I had the PERFECT candidate. I forwarded the resume in via the regular channels, and then I tried to set up a meeting with my client to discuss the opportunity, my perfect candidate, and the value proposition my client would receive from having a resource with skills from my company (vs. anyone else’s company).
Then - my client postponed due to a conflicting meeting. Then I couldn’t meet, we traded a few emails trying to arrange schedules, but I never got to give any of those valuable marketing messages to my client.
We finally managed to set up a meeting for next week, and I was all ready to give my wonderful marketing messages.
Then - I got an email from the client’s Human Resources director (who manages the hiring). They sent out a generic email stating that the company had just filled the position - and thanked us for sending in resumes. I got shut out.
So - I think it’s a great lesson in letting the day-to-day urgent tasks get in the way of the important tasks - like building relationships, and performing long term planning.
Make sure you’re not caught up in the day to day so much that you don’t do the things you need to grow.
Great idea…no money!
Teague Bengtzen, President
Once we had the idea of online greeting cards we could not sleep! Every morning we would meet with new ideas, “What about the printing the sender’s return address?” or “What about being able to schedule cards to be sent in the future?” or “What about offering gift cards and chocolate and gift baskets?” or “What about letting the customer upload any amount of photos they want?”. The idea was the easy part. Now what do we do?
It was determined that Card Café should be a global business – chipping in a few thousand dollars here and there would not cut it. We needed big money. We started going through everyone we knew. We were sold on the idea, now we had to sell them. We found it was not hard to raise money because we already had the experience and equipment (we owned a printing company) AND the idea was something everyone could understand and see the need for. $200,000 seemed like a lot of money so we set that as our goal. We burned through it in a few months. Raising money was one of the most time consuming projects for the first 2 years and it is NO fun!
We found having samples of the product to show our friends and family made a world of difference. People have a hard time visualizing what “could be”. We also found that asking for small amounts like $20,000 increments made it much more appealing to people. Also, many of the people we spoke with wanted to know what our exit strategy was - people want to know they can expect a return in 5 years or less.
A word to the wise - whatever amount of money you think you need – double or triple it!
Week 2
This has been an interesting week for Escondido Real Estate and the mortgage business. Interest rates have been all over the map, moving by over 30 basis points on the 10 year bond twice this week. The good news is that once it went up, and the next time it came down. I like the coming down part better.
Office difficulties this week, as the property management company decided that they really needed to install a roof drain directly above my office. That meant that everything got a nice plastic covering and I was consigned to working out of my car for an entire day. I love being self employed.
On a different note, House Resolution 5830 in the US House of Representatives is dealing with the ongoing subprime crisis, and trying to decide how the government will run to our rescue. Ronald Reagan once said that the scariest phrase in the English language is “We’re from the government, and we’re here to help.” It looks like both parties, Mr. Obama, Mrs. Clinton, and Mr. McCain all feel like there needs to be a “principal cramdown” to reduce the amount of debt owing to no more than 90% of the current appraised value. That’s going to cost billions. Of course, the current flood of foreclosures is costing billions as well.
It’s Hiring Time – Gathering Resumes
For me, going through the process of hiring new employees is fantastically frustrating. It’s a time consuming, uncertain, potentially expensive process. I suspect it’s the same for most small business owners. We would much rather spend our time growing and maintaining our businesses than dealing with things that, while important, keep us from our primary tasks. Even so, it’s time again to conduct another round of hiring here at eReplacementParts.com.
It’s always tough to get those resumes flowing in. There are lots and lots of companies out there that can help you find potential employees. In fact, the second you place any visible job ad they’ll come knocking at your door. While I’m sure their services are extremely helpful and convenient, we’re way too small to be able to pay fees of $5,000 or more per employee. It’s simply not an option, especially when we’re hiring entry level employees.
We’ve had pretty good luck using free or relatively inexpensive services to find employees. The first thing I always do when we need another employee is place a free ad on craigslist.org. If I place the ad in the morning, I’ll usually have ten or so resumes by the end of the day. It’s a great start. Also, lots of churches provide free services for connecting employers and job applicants. Try calling your local parish or synagogue. We’ve dabbled in newspaper classified ads with limited success but this can get expensive in a hurry. To be honest, I’ve found the very best way to find quality employees is through my own personal networking. I’m always sure to get the word out to friends and family that we’re hiring.
As our hiring process continues over the next few weeks I’ll make sure to keep this blog updated. I’ll talk a little more about checking references, interviewing, and making job offers. Stay tuned!
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