Exceed Expectations.

Under-promise and over-deliver. This is so easy to do, you should be able to do this instantly, today. With the next in-coming phone call, with the next e-mail inquiry, with the next bell jingling of someone walking through your door, do it. Make it company policy. Now. Forever.

Ponder a little bit on the psychology of how it works. If someone tells you your product will be delivered on Thursday, but does not show up until Friday, you are very disappointed. If they promised it Saturday and it shows up Friday, you are elated with their great service! The difference is just what was promised by YOU.

You are in control of what you promise. DO NOT just tell people what you think they want to hear. Lie to them! Always tell them it will later than it will be, more expensive than it will be or not more at least. When you say you will get back to someone by tomorrow, get back to them this afternoon.

This is so easy to do, you need to just do it.

Let me know what you think by leaving a comment below.

I feel a rant coming on….

In this day and age, how can people with small businesses be so damn stupid? In ancient times 50 years ago your business existed fairly cut off from the rest of the world. You would treat customers badly and maybe you got away with it because you were the only provider in town or you lived in a large populated area and could rely on new customers all the time. People were connected only to the extent they talked to each other. Today we have outlets to connect and share information. We can add our ratings to just about anything we want now, and it’s getting more and more connected every day as more and more people who are not afraid of technology join in and become the norm.

When you treat someone badly and they go away and you never hear from them again, do you seriously think that is the end of it? Are you THAT stupid? Yes, yes, I think you must be. Don’t you understand that when you mess with people today, as it has been always, you set in motion a negative advocacy? People who are not happy with your little business will be out there spreading the word, the negative word, to DOZENS of people, every chance they get!

They will often go out of their way to spread the negative word about you, free of charge. If your category of business comes up in conversation, even years later, they will strongly encourage others not to do business with you. And people listen to people.

Negative word-of-mouth (NWOM) is the stupidest thing you could possibly set in motion. It cancels out the positive advertising you are paying good money for because one is being said by you, which is suspect, the other is being said by someone who has dealt with you, which is almost always believed instantly.

A rule of thumb I used to hear all the time was that someone that was happy would tell like 5 people about your business but someone that was ticked off would tell 15! There is a part of us that values highly this social contract between us, we help each other because we want our opinions to matter, and when someone without a vested interest says something, if that person is credible, we accept it as fact.

The difference today is that we have so many ways to get the word out that negative publicity can spread within hours to a much wider range of people than was ever possible before. Do you think it was very smart of Verizon to piss off Seth Godin?

(http://sethgodin.typepad.com/seths_blog/2008/06/learning-from-f.html)

At the risk of generalizing, home repair contractors are the worst. You call and maybe you can get someone to show up or even to return your phone call. The smaller the business, the worse they are, and if it is a one man show, I would say 8 out of 10 either never even return your initial phone call or they cheerfully set up an appointment but then never show up and never call again.

Tell me your thoughts, am I alone in this?

“Make yourself necessary to somebody. Do not make life hard to any.” Ralph Waldo Emerson

Let me know what you think by leaving a comment below.

Take away the risk of doing business with you.

Today, we are marketed to constantly and everywhere it seems, and as a result people largely ignore hype. The ad rarely generates the interest by itself, a person has to have been somewhat interested  for the ad to even get their attention. Once you have someone’s attention, the first thing they think is, “can I believe this”? If your marketing offer is believable, then the next thing they think is “how much”? Obviously, if the price is too high, they bail. Assuming the price is reasonable, NOW is where the important step of taking away the risk comes into play. By removing the risk you are getting them to say, “OK, why not!” The decision process I just described takes place in about 2-10 seconds! 

Is this something I’m interested in? NO-YES

Is this believable? NO-YES

How much?

Is it worth it? NO-YES

Decision made. Time elapsed, seconds.

Take away the risk of doing business with your small business. Take away ALL risk. Offer a 100% money-back guarantee or even a 150% money-back guarantee. It’s very simple, people don’t want to be stuck paying for something that is not what they expected. Remove the barrier. 

For my payroll service business, Van Cleve Payroll, the fee I charge with each payroll is in the form of a printed check, made out to my company, delivered along with their employee’s paychecks. I tell them that if they are unhappy, if they feel I did not earn the fee, to please tear up the check. All other payroll services, as far as I am aware, automatically deduct their fee and the customer has no say. I give them the control. That’s my way of removing the risk. 

For every person who starts a business of their own, or has a small business, Michael E. Gerber’s book, “The E Myth Revisited” should be a required read. I’m going to post once a week on ideas from this book. For those who have never read it, I’ll boil it down for you, although you should get a copy anyway, I’m only going to talk about the lessons, yet there is much more. Gerber is a wonderful story-teller. For those who have read it, this will be a refresher of a wonderful business-self-help classic that stands the test of time, and it is one of those few books that you find yourself reading over and over…

This week lets see how the concept of a franchise started and how Gerber suggests adopting the ideas for your small business.

Franchising has been around for a very long time. Coca-Cola and General Motors have always franchised as a way to increase sales over a wider area. What they franchised was their name primarily and in the case of Coke, the right to combine their syrup with carbonated water and bottle and distribute the product. A different thing started in 1952 when Ray Kroc, a milkshake machine salesman, walked into the MacDonald’s brothers hamburger joint and became instantly enamored of the efficiency of the processes he saw. He struck a deal to franchise the entire business, right down to exactly how hamburgers were cooked, how the pickles were arranged. Ray, who was modestly successful as a milkshake machine salesman, became a huge success when he grasped the bigger picture and was able to share (and sell) his enthusiasm for the entire business format to others. Ray had the insight to see that he was selling the business, the way it operated, the way it looked, the way it made money. He wasen’t selling hamburgers! The business itself was the product, it was a money machine! He was selling money machines! Later he bought out the MacDonald brothers, changed the name to McDonalds and the rest is history. So, how does this apply to your little business? What Gerber prescribes is to treat your little business as if it were a prototype of a franchise, like a McDonalds. Not necessarily to actually franchise it, but to treat it like one. What it forces you to do is to look at your business differently. To look at it as the product you are selling. That’s the secret, it’s not the commodity your business sells that’s important, it’s the way it sells it! It’s the series of systems you are taught to establish that make up your business model.

I’m frequently heard lamenting about small businesses that are not “run like a business”. What do I mean by that? In many years I’ve seen very successful businesses and I’ve seen the miserable failures too. Here is a list of traits of people and small business subjects that I think directly contribute to a businesses success. 

Don’t just operate out of a checkbook. Just gauging the level of cash does not tell you much. You could be paying way too much for certain types of expenses and never realize it and your checkbook won’t tell you that. You must get feedback on the activity of your business in order to run it right. The presence or absence of cash alone tells you virtually nothing about whether your business is successful or is headed for disaster. By the time you notice cash dwindling, it could be too late. Cash could be building while you are missing opportunities. A check register is not a substitute for a P&L.

Have a real location. You can’t run a business from under a bridge or from a park bench. Customers and potential customers have to have some level of trust in you. You have to have a real presence. Having said that, if your business absolutely does not need a physical location, then you better have a kick-butt online presence. You are either serious or you are just playing.

Accounting we will go. You must have a proper accounting system so your business talks back to you. A proper accounting system tells you exactly what kind of income comes in and from where, and exactly what your expenses are and in what category they fall. It is the only way you will ever be able to tell if one part of your business is out of whack. 

Don’t specialize in everything. Don’t be like the car repair place that says, “we specialize in all makes, foreign and domestic.” Huh? How can you specialize in everything? Do the opposite of this. It is tempting to want to include more lines of work to broaden your appeal but resist this temptation. Do the opposite. Specialize. Find a niche that only you do. Be the best damn one there is in that one thing.

Learn to market it right. Don’t just spend money, do the free stuff first. Employ the 3 feet rule. If someone gets within 3 feet of you, tell them about what you do. Be shameless. If you are reluctant to sell yourself, what does that say about you? Don’t you believe in yourself? 

Keep business and personal expenses separate. Don’t mix it up. You have to keep things separate to know your true costs. If you’ve incorporated, your CPA will tell you to do this anyway. 

Tune in tomorrow for more…

For every person who starts a business of their own, or has a small business, Michael E. Gerber’s book, “The E Myth Revisited” should be a required read. I’m going to post once a week on ideas from this book. For those who have never read it, I’ll boil it down for you, although you should get a copy anyway, I’m only going to talk about the lessons, yet there is much more. Gerber is a wonderful story-teller. For those who have read it, this will be a refresher of a wonderful business-self-help classic that stands the test of time, and it is one of those few books that you find yourself reading over and over…

Now that we know of the 3 aspects of personality that make up a businessperson to one degree or another, let’s look at how the tension between them looks. I once heard of an interesting way to look at human behavior, when we question why people act as they do- especially when it does not make sense or is odd behavior, it’s root is two opposing ideas trying to exist at the same time inside our head. When we are acting in a confused manner, it is because we are trying to hold two opposing thoughts or emotions simultaneously. We have a battle inside.

When looking at the three aspects of personality referred to in E-Myth, the conflicts look something like this; the entrepreneur lives in future possibilities, and creates chaos, the manager grimices at the idea dealing with another one of the entrepreneur’s bright (or goofy) ideas, yet the manager would’nt have anything to manage were it not for the entrepreneur. The manager lives in the past and craves order, cleans up the messes left by the entrepreneur. The entrepreneur is irritated that the manager always pours cold water on ideas and says why things won’t work. The technician is the doer, living in the present. The technician just wants to go to work and be left alone. To the technician, the Manager is a meddler to be avoided. The technician certainly hates to be managed, and also has no patience for listening to the entrepreneur talk ideas, not when there is work to be done. 

Gerber says if all three aspects of business personality were in balance, you would be an incredibly effective business person. Very few of us are that lucky. So what do you do? Gerber says the answer lies not in hiring incredibly talented people to fill the gaps in your personality, but rather to create systems that can be run by low skill people. Have people run the system, and the system runs the company. That’s what we’ll get into next time…

Winning at small business requires not only being talented at something, work you enjoy doing, but as I often preach, running the business like a business. More on that some other time. What seems to be the biggest challenge, and the source of the greatest frustration, is how to market your small business, especially a service. Most of us are not naturally good at marketing, especially if your personality is not the salesperson type. So, here are some things I’ve learned along the way to keep in mind when creating any marketing copy…

Sell the benefits, not the features. It’s OK to list the features of your product or service, but don’t just boringly list them without explaining them. Explain what the benefits of the feature are, you’ll want to show that having or using it will give them something they desire. Features are boring. 

What is the most effective way to market? It is to convey a benefit that they end up saying to themselves, “I want that”. Now, rather than crudely clubbing them on the head like a caveman, try a more subtle approach. Suggest, don’t state. Suggest that they will feel this way or that way. Do it indirectly, by inference. Don’t  state assertions directly, HINT at them.

What people really want is to experience the feelings and benefits they see other people having or experiencing. You wouldn’t state that your widget was XXX as a matter of fact, you might show someone who had one or was using it- smiling, laughing, having a wonderful time, you are “implying” that they are benefitting by inference. 

That’s why testimonials are so effective. It’s not YOU saying it. No one will believe you, but seeing another person’s enjoyment makes it acceptable, and makes them say to themselves, “I want that too!”

To sum it up, people want the good things they see other people experiencing. Hint, don’t state. Have someone other than you doing the talking, they don’t believe you, you’re just trying to sell something.

Leave me your thoughts…

For every person who starts a business of their own, or has a small business, Michael E. Gerber’s book, “The E Myth Revisited” should be a required read. I’m going to post once a week on ideas from this book. For those who have never read it, I’ll boil it down for you, although you should get a copy anyway, I’m only going to talk about the lessons, yet there is much more. Gerber is a wonderful story-teller. For those who have read it, this will be a refresher of a wonderful business-self-help classic that stands the test of time, and it is one of those few books that you find yourself reading over and over…

There is a huge error that probably most budding business builders make. They assume that if they know how to do the technical work of a business, that by extension, they know how to run a business that does that technical work. These are two completely different things. It does not follow that knowing how to do technical work means you know anything about how to run a business. You may be a great and talented plumber, salesperson, engineer, software designer, whatever, but what do those have to do with running a business?

To the technician, a business is just a place to go to work. It’s great, the boss is dead, in fact, there is no boss. You see, the entrepreneur died shortly after getting the bright idea, that’s when the technician in you took over and made a business by doing the work. Knowing how to do the work is the businessperson’s greatest hinderance to the health of the business. Why? Because the technician can’t run a business the way it should be run- like a business! 

The technician used to love the work, now it has changed. It is just a chore. The purpose is gone. You’ve lost that special connection with your work. Now you HAVE to do the work. But don’t forget, there are the other two aspects of your business personality; the manager and the entrepreneur. All three wants to be the boss but none of them wants to have a boss. They go into business together so they can fire the boss. And the conflict begins…

Another question, who is your ideal customer? What are the exact specifications of the

ideal; company size, age, gender, income level, hobbies? Identify your top customers in

terms of profitability and profile them. What are their demographics? What companies do

they admire most? Why do your customers hire you? Have you ever surveyed them?

The flip side of this exercise is to outsource all the things you are currently doing that are

not your core competencies and that are not central to income generation. Keep the work

of your business as simple as you can. Concentrate on those activities that are directly

related to revenue generation. Focus your efforts. Every hour of every employee’s time

spent doing chores that are unrelated to generating revenue is actually hurting your

business because not only is it non-productive, there is the opportunity cost- that time

could have been spent doing productive, income generating activities. Even you owners

can only lay claim to being proficient at perhaps 2 of the 15 hats you have to wear, that’s why you

hire the talent you lack, so you can leverage talent for your business.

Now reduce it to one thing that your business excels at in your marketplace. Once you

have that one thing, how can you communicate that to your ideal customer in an

irresistible way. Yes, your goal should be an irresistible offer. Make your marketing

clearly state your irresistible offer related to your core competency, back it up with

testimonials so it’s believable, take away the risk of doing business with you, and you

will have a clear, focused marketing message. Do you have work to do? Has this been

helpful? I hope so.

The key way your business will prosper is to identify those things it does really well and

preferably does better than any other, then find ways to communicate those to potential

customers in a way that makes you the obvious choice to do business with.

I don’t particularly care for the word competency, it is not good enough to merely be

competent. You’re competent, so what? Your customer expects competent. What do you

do better than anyone else? Schedule a meeting with your top people and brainstorm, but

be careful not to believe your own PR. There is a definite danger in sessions like this, a

group meeting in which everyone is trying to say things they think the boss wants to hear.

You might end up with results that sound like, “We’re really competent at providing

custom solutions for our customers.” Huh? What does that mean? Sift out those things

you are merely competent at, can you become better at any of these? What will that take?

Once you have one or two things you do better than anyone else, the next question is does

anyone know it? Are you communicating that to potential customers? How?