Business Saves $1,177 Annually In 5 Minutes!

One important area of improving your profit margins is to reduce your costs. Sometimes you can reduce your costs without a reduction in the quality of service you receive from a supplier, sometimes you’ll see lower quality – cheaper isn’t always better. However…

I saved a client $1,177 in 5 minutes. Without mentioning the name of the client, I can say the business is located in Perth. For illustration purposes, let’s call my client – Mary.

Area saved #1 : Mary sent me an email saying that she was still paying $77 per month on her Sensis bill for a CitySearch web site.

CitySearch was one of the many online directories that popped up during the dotcom boom in 1997-2000. It was bought out by Sensis. Back in the 1997-2000 period many businesses were called with an offer of a new website for only $77 per month.

What many businesses didn’t realise is that this monthly fee went on forever. Sensis never contacted Mary to say “Hey we’re billing you $924 per annum for a web site we built 10 years ago, we can now update your website for free if you like.”

Mary’s website was replaced over a year ago (not by CitySearch), so I knew that the $77 per month was a totally unnecessary expense. I got Mary to cancel the CitySearch service. I only wish Mary brought it to my attention sooner. She could have saved over $1,000 in the past year.

STRATEGY FOR YOU : Check all your supplier’s invoices and question any unnecessary services.

Area saved #2 : Do you have a website? If you do you’ll be paying an annual fee for domain name renewal. Did you know however that I use Netregistry (an Australian company) – their annual fee for renewal is $44.95. If you’re paying any more than that you are paying too much.

STRATEGY FOR YOU : Check the bill from your domain name supplier.

Area saved #3 : Unnecessary domain name registration. Mary had a website ending with .net.au. DotnetDotau domains are really not needed. If you want to secure another domain for your business, register the Dotcom name as well as your DotcomDotau address.

STRATEGY FOR YOU : Don’t register or renew a DotnetDotau domain (.net.au). Save the money instead.

Mary’s savings per annum : $984 for CitySearch, $140 for (.net.au) and $113 for using Netregistry to renew her DotcomDotau address. Total saving $1,177.

(Actually it took less time for me to save my client $1,177 than to write this email. But I thought you’d appreciate this information.)

The lesson : Charges from suppliers for unnecessary or excessive fees is commmon. It’s worthwhile to periodically check all your invoices and question any charges you don’t know about or feel are overpriced. This is an easy way to improve your profit margins.

Are Peers On Your Team Too?

In business much can be learnt from peers in your own industry or from related industries.

I found an ‘old’ photo – well, a November 2008 photo of Ari Galper (left), Steve Baker (right) and myself (middle) after we had attended a two-day marketing seminar.

Ari Galper is the creator of Unlock The Game™, a completely different mindset about selling. I actually invested in Ari’s program ‘Unlock The Game™’ back in 2005. The program based on using sincerity to build trust in a sales environment. Highly recommended.

Then there is Steve Baker former business coach to the carpet cleaning industry and now famous for his expertise with fax and voice broadcasts.

Are You a Marketer or a Shop-Keeper?

Everyone who is successful in business has a mentor (or mentors) and a coach – or should have! Even Bill Gates (once the world’s richest man) had Warren Buffett (the world’s second richest man) as his mentor. One of my mentors is Dan Kennedy. I receive his paid newsletter once a month and it’s a great way to improve my business and marketing knowledge. One of the topics in the newsletter was ‘Are You a Marketer or a Shop-Keeper?‘ As I have recently been talking to a number of small retailers I found this topic to be particularly relevant.

Out of 14 retailers who I spoke to in December, only 4 (28%) understood the importance of constant promotion in a retail store. I was dumbfounded! The other 72% held the belief that doing the same things they were doing (very little) was somehow going to lead to sales increasing in their stores.

I heard that Albert Einstein quoted this definition of insanity … "Doing the same thing over and over again and expecting different results."

These retailers were silently praying for a few more people to come into the store, that staff won’t call in sick, suppliers won’t increase their prices, no competitors will open a shop nearby, and that the landlord won’t up the rent this year. Dan Kennedy calls this approach ‘passive marketing’ – which actually is doing nothing at all. He said "This person is a shop-keeper and an order taker, sticking up a sign, putting goods on a table, sitting and waiting."

The only way forward is being a marketer – constantly promoting to attract new customers, get them to spend more, and return more often. That’s how businesses really improve cash-flow and increase their value.

Using The Open Day Marketing Strategy

Improving Local Awareness Of Your Business Using Open Days!

This week I’ve got a good example of how to improve the local awareness of your business.

Bunnings in Balcatta had an open day / weekend to celebrate the completion of their warehouse upgrade. My family and I went along and I would say they had around 500 people there around 8pm (see my photo below).

How you can use the Bunnings idea in your business

The open day marketing strategy doesn’t have to be limited to the first day your business was open to the public. You could use the same idea to celebrate any anniversary (of any year in business), or to launch new products or services, or to show off a store refurbishment (like Bunnings did) or even to celebrate a tie-in event like Easter, Father’s Day, Halloween, Melbourne Cup and so on.

The aim of the open day may not be to generate sales, but rather to improve the branding and awareness of your business in your area or to generate leads which you (or your sales team) could follow-up with later.

Above is the photo I took in the store during the Friday evening celebration party.

Above is a marketing flyer Bunnings used to promote the event.

Creating a Vision for Your Business!

“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.” Jack Welch, Chairman, General Electric.

Without a strong, defined vision, most businesses usually fail because the challenges got too tough – the business fundamentals outweighed the ‘passion’ and drive. The vision therefore drives the company through good and bad times. The vision is the purpose and ’soul’ of the business.

Creating a vision for your business

Define the vision…

• What do I see as the key to the future for our organisation?
• What unique contribution should we be making in the future?
• What would make me excited about being a part of this organisation?

A vision statement is a company’s inspiration. A vision asks, “Toward what reality do we want to lead this organisation?”

For example :

Walt Disney’s vision statement :
“To create a new kind of amusement park filled with the accomplishments, joys, and hopes of the world we live in.”

Microsoft’s vision statement :
“Empowering people through great software at any time, and any place, on any device.”

Sony’s vision statement :
“We invite new thinking, so even more fantastic ideas can evolve. We take chances. We exceed expectations. We help dreamers dream.”

IKEA’s vision statement :
"To create a better every day life for the many people."

Use these examples to create an unique vision for your business. How can you do or provide something so good that people cannot stop talking about you?

27 Questions You Should Ask Before Buying A Business

I met the husband and wife owners of a small retail shop recently. The business was running at a $65,000 (approx) annual loss.They had purchased the business over 12 months ago and had been steadily losing money. I looked briefly at their books and realised they had paid too much for the business. On top of that, both of them had no retail business experience and they had decided to cut out all of the advertising that the previous business owner had been running – due to cost reasons only.

I asked them how much research and due diligence had they conducted before buying the business. I was shocked by their response…

“We asked the solicitor who was performing the business settlement service if the business was a good buy.”

Talk about flushing $$$ down the toilet. Needless to say, they no longer have any available capital to invest in marketing or anything else. The outcome will be to close up shop and accept the loss, and the lesson.

So how do you actually avoid this type of business disaster?

Ask yourself these questions…

1. Why am I going into this business?

• For lifestyle (to work fewer than 40 hours per week, with the freedom to go on holidays whenever you choose)
• To make a profit by building the business up (increasing sales)
• To generate more cash-flow than than a 9-to-5 job.

If your reasons are not listed above – don’t buy the business. If you want to be involved in what the business does (manufacturing, retail, services, etc) out of personal interest, it’s much less stress and safer to be an employee.

2. What do I want from being in business?

3. What will be my exit strategy to get out of the business?

• Sell the business for a profit
• Sell the business to a major shareholder(s) and become a silent partner
• Pass the business down to a family member
• Franchise

4. What skills do I have that will make me successful in this business?

Please don’t think that all that is required to ‘improve’ the business is cosmetic – by changing some of the products, re-designing the store interior, etc. These ‘improvements’ won’t double sales.

Only very good marketing, a good sales team and good systems will increase sales significantly. Think MARKETING, SALES, DELIVERY of the product or service (using systems).

5. What skills will I have to “hire in”?

6. What cash flow do I need?

7. How much working capital do I have access to?

8. Will this business suit me i.e. hours, type of operation?

To ask the vendor who is selling the business…

9. How long has the business been operating?

10. How long has the current owner had the business?

11. Why is the current owner selling?

• Worn out from working long hours for little money?
• Couldn’t make the business work (perhaps in it’s current location)?
• Actual legitimate reasons such as retiring, moving to another state or country, or looking for another challenge in another business?

12. What is the Cash flow and Profit (Gross and Net) for the business?

13. What is the business owner paying him/herself?

14. What do the last 3 years of financial accounts show?

15. How has the business been valued?

16. Who are the key customers, suppliers, staff?

17. What are the terms and length of any leases?

18. Will the current owner stay on and assist for a period of time?

Ask them to put this period in WRITING!

19. What areas of the business are systemised?

20. Is there a business plan?

21. How many hours a week does the current owner work in the business?

22. When was the last time the current owner took a holiday?

23. What is the marketing systems like? Do they make money for the business?

Review all advertising material, the customer database, the POS systems (if applicable), any loyalty programs, special promotional material, etc.

24. What facts support the "story" of the business?

25. How secure is future income i.e. contracts with customers and suppliers?

26. How dependent is the business on the current owner?

27. What will it take to grow the business so I can sell it for a profit?

Before you make an offer

1. Get your accountant to check the financial accounts

Obtain actual lodged tax returns with the government, not the business owner’s printout or handwritten bookkeeping summary.

Your accountant will ensure that the business has cashflow and is not over-capalised.

2. Hire a solicitor who is experienced in buying businesses like the one you are looking at.

Your solicitor will ensure that the contracts with suppliers, the landlord, etc don’t have any surprises.

3. If you are spending over $250,000 on the business, or even if you want to be extra careful, pay for a business valuation.

Pay a licenced valuer to come in and audit the business. Even if you have to spend $7,000 for the valuation, it’s still much better than paying $50,000, $100,000 or more than you should have to buy the business.

You may even be able to ‘use’ the valuation to negotiate a better price.

The lesson

Homework always pays off in business. Taking shortcuts and buying a business on emotion often lead to regrets. Don’t let this happen to you.

Time Management Secrets Of Successful Business People

Once of the most common responses I get from business owners is about time – “How do I get time to work on my marketing?”, “How do I find time to systemise my business?”, “I just don’t have time to think about my strategic plans”

Hundreds of books have been written on the subject of time management and most have good suggestions, tips and ideas. But the simplest way to find out how successful people manage their time is to ‘model’ what they do. I have copied (modelled) my work habits around successful businesses people in my industry and these are ones that I have found to be the most successful :

1) Creating a daily to-do list with 3 top things to be done. Doing your best to complete those 3 tasks – usually by ‘blocking’ out time without interruptions (from staff, no phone calls, reading emails, etc). You are essentually making an appointment with yourself (or have your PA do this for you). Any uncompleted tasks are rolled over to the next day.

2) Creating a 30-day to-do list. These are tasks to be completed this month – you pull your daily top 3 from here.

3) Focusing on high leverage tasks, rather than on medium and low leverage tasks.

4) Delegating, training, systemising and giving staff the authority to make decisions on their own – so your business can run without you!

Here is a list of high leverage business tasks (this is where you should be spending most of your time)

• Strategic planning and vision for the business
• Marketing planning
• Utilising media (press releases, advertising, direct mail, etc)
• Developing business systems (admin, legal, IT, staff, service delivery, supply, marketing, sales, etc)
• Developing information material or products (every business whether wholesale, retail, service or professional services needs these)
• Working on business uniqueness
• Reviewing financials and ensuring a good return on investment
• Creating Joint Ventures and Strategic Alliances
• Promoting the business – developing presentations and speaking at seminars, trade shows or networking
• Reviewing staff performance, feedback and suggestions and developing staff systems for your General Manager
• Organising customer research or reviewing customer feedback
• Meetings with your ‘Mastermind Group’ – peers in business
• Meeting with your ‘top’ staff – financial controller, marketing, sales and general managers (these many be shared roles in a small business)
• Delegation : Staff and outsourcing

Here is a list of medium leverage business tasks

• Sales (of products and/or services)
• Providing the service that the business sells (auto servicing, computer servicing, chiropractic care, financial planning, etc)
• Supplying products that the business sells (wholesale, retail)

Here is a list of low leverage business tasks

• Bookkeeping and Accounting
  • Paying bills
  • Payroll
  • Invoicing
  • Following up outstanding payments (account receivables)
  • Tax preparation
• Inventory
  • Ordering stock
  • Receiving and inventory of stock
• Administration
  • Staff admin
  • Opening the mail
  • Filing
  • Basic computer stuff
• Supervising and training staff (you should be working on staff systems instead)
• Answering the telephone
• Deliveries
• And so on … you get the idea…

The four time management procedures (daily list, 30 day list, high leverage, delgating/systemising) are simple to understand and easy to follow. All it takes is a bit of self discipline initially and then it will become routine. If you have staff there may be some resistance to change as they may be used to ‘bugging you’ everytime they have a problem – but, don’t ignore them – document their frequent questions and the answers – that way they can consult training or company procedures instead. Soon you will quickly notice how much progress you have made ‘working on your business’ and not ‘in it’.

Creating Wealth by Adding Value!

Make me rich!

Everyone wants to be rich (or at least have a good disposable income). It’s human nature. Often this desire comes out of the ‘frustration’ of the daily grind (the rat race). Getting rich quickly is even more desirable, hence the search for the ‘holy grail’ of being able to create wealth the easy way, but in reality it involves some exchange of ‘value’ for money. This got me thinking – so I grabbed a few books from my personal ’success’ library.

Here is how wealth is able to be created (in broad terms) by an individual or by a company :

• Creating / Inventing something (e.g. Apple iPod)
• Producing / Manufacturing something (e.g. Apple iPod)
• Improving something (e.g. Newer models)
• Providing a service (e.g. Settlement agent, Financial Planner, etc)
• Repairing / servicing something (e.g. Auto vehicle servicing)
• Selling (e.g. selling own manufactured product)
• Trading (buying and selling)
• Holding something (it becomes more valuable the longer you hold on to it).

Even ‘holding’ onto real estate is adding something .. time (which equates to more demand as the human population increases).

When we provide our knowledge and skills to something we are paid. For example, accounting, bookkeeping, hairdressing, auto servicing to name a few. We are paid in direct relationship too how many people can provide the same thing, the skill and expense required to attain those skills (e.g. medical degrees, etc), and the demand for those skills. How can you do ’something’ that few other people can do (which is in demand)?

For example, someone that can touch their nose with their tongue might be neat, but how is that going to make them money? (Apart from appearing on television as a novelty).

The big money question is ‘How can I add more value, quicker and easier, and to more people?’

This is one strategy…

Use leverage

The definition of business and financial leverage is using less of your resources (time and money) to create a bigger end result (Return on Investment). Here are some of the ways you can use leverage to obtain a bigger result.

• Your Skills
• Your Knowledge
• Your Money
• Your Time

Some examples may include :

Your Skills

• Employing staff, delegating or outsourcing.
• Applying your skills to bigger projects for a bigger reward
• Creating information products (books, audio and video recordings)
• Creating business systems

Your Knowledge

• Creating information products (books, audio and video recordings)
• Creating business systems

Your Money

• Purchasing income-producing assets
• Utilising media to communicate your marketing message (e.g. advertising, direct mail, email, etc).
• Re-investing in the business (e.g. marketing systems, technology)

Your Time

• LABOUR : Employing staff, delegating or outsourcing.
• TRAINING : Training staff so they can perform their functions well.
• SYSTEMS : Introducing systems to ensure the job is done right the first time and consistently.
• TECHNOLOGY : Using technology (e.g. using video conferencing instead of travelling to a meeting).
• MARKETING : Developing lead generation systems to reduce time spent acquiring leads one-by-one.
• GROUP SELLING :Speaking and selling at seminars rather than speaking to prospects one-on-one.

Hopefully the strategies mentioned above have given you some ideas. You can also have a close look at your chosen business niche or investment area (residential real-estate, commercial real-estate, stocks, etc) and see how other successful business owners or investors have added ‘value’ or used leverage to create wealth. It’s not worth re-inventing the wheel. Find a way to copy what works and improve on it!

Attitudes (Mindset) of Successful People

Most people have a desire to be rich or be successful, yet so few attain prosperity and great wealth. This is something that I have pondered for over twenty years. So, I had a close look at my mentors and other role models like Steve Jobs, Bill Gates, Donald Trump, Warren Buffett, Richard Branson, Anthony (Tony) Robbins and many others. I observed personal success usually occurs from a number of behavioural patterns and certain ‘attitude’ traits. Here are some of the reasons why many individuals are successful in their field of endeavours.

1] They have a life purpose or vision of what their company or life will be like in the future.

All great accomplishments begin with an idea and a vision. It’s purpose and vision that drives and motivates them.

To help you define your life purpose, click here.

To help you create a vision for your business, click here.

2] They have written down goals.

If you don’t know where you’re going, how do you know when you’re going to get there? I know many people in my own life (including family members) that just ‘float’ along in life without direction.

Studies have shown that written down goals have a higher probability of being achieved.

Try our goal setting forms, click here.

3] A burning desire to succeed.

Think about how competitive it is to be good in a chosen field these days. You WILL encounter set backs and challenges. I like to look at these challenges as a test to see if I’m serious about achieving my goals or not.

This is where written goals help. They will highlight what you have achieved so far and will give you the extra boost to keep going.

Having a good ‘friend’ to talk to when you feel a bit ‘blue’, helps too. Ask them to be your ‘Success Buddy’.

Read about other successful people and what challenges they overcame.

4] The acquisition of specialised knowledge to achieve your goals.

I enjoyed reading about the life story of Henry Ford. He continually learnt more about building motor vehicles, hiring talented people and investing in research.

To achieve your goals you will need to master certain specialized fields or skills, such as book writing, public speaking, writing and publishing press releases, becoming an expert in engine repair, etc.

If you can afford it, hire the best skilled people you can find.

Want a shortcut? Find people that have achieved your goals and just ‘copy’ them. It might cost you a few thousand dollars, but you will reach your goals quicker with lower chance of failure.

Read, watch videos, go to seminars, conduct tests and experiments, observe all you can about your specialisation.

5] Being decisive in nature.

Successful people know how to take advantage of opportunities that come up and they make a decision very quickly. Sometimes the decision will be the wrong one, but not making a decision is really a ‘no’ decision anyway.

Rich people surround themselves with experts who assist in making informed decisions. What ‘experts’ do you have around you?

6] Utilising mentors or being a part of a mastermind group.

As already mentioned in point four and five, surround yourself with experts and also have another group of people who share similar goals as yourself.

I currently meet with my ‘mastermind’ group every week for two hours. We’ve been doing that for over one year now and the benefits are enormous.

The outcome?

There are no guarantees in life (unfortunately), BUT, I have seen (personally) many of my wealthy mentors ‘live’ the attitudes mentioned above and I strongly believe these are some of the main reasons they are so successful. Now, how can you apply them to your journey?

Creating the Vision, Mission and Culture for Your Business

Step 1) Define the Vision

• What do I see as the key to the future for our organisation?
• What unique contribution should we be making in the future?
• What would make me excited about being a part of this organisation in the future?

A vision statement is a company’s inspiration. A vision asks, “Toward what reality do you want to lead this organisation?”

Step 2) Create the Mission Statement

How will the vision be achieved?

a) Who are you ? Define the characteristics of the people in your organisation. What are their qualities, attributes, etc ?

b) What business are you in?
e.g. the transport business

c) Who are your customers?
e.g. demographics, age, etc

d) What makes you different?

e.g. Starbucks
“Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.”

e.g. Target
“At the heart of our strategy is our commitment to delight our guest by consistently delivering the right combination of innovation, design and value in our merchandising, in our marketing, and in our stores. This is the essence of our “Expect More. Pay Less.” brand promise.”

e.g. Nike
“To bring inspiration and innovation to every athlete* in the world.”

Step 3) Culture statement

Ownership, integrity, teamwork, communication, etc

This is an example of a culture statement :

Ecolab USSpirit Ecolab associates are the company’s heart and soul. Hungry to succeed and passionate to achieve, we embrace the unknown, fearlessly taking risks, confident in our ability to deliver results. We are eager and ambitious. We tenaciously persevere, surmounting obstacles with grit and determination. Above all, we find joy in our work, and in serving the company and our customers. Pride Exceptional service, exceptional products…We delight in presenting premium quality in all we offer. No matter how big the project, or how small the request, we strive for excellence in our response, for we relish perfection. We cherish our company, and represent it with honour. Determination Ambitious and aggressive, driven and determined, enthusiastic and energetic, we cultivate the opportunity to compete. We thrive on challenges, viewing them as an invitation to success. A true team, we work together to routinely please our customers, surpass our record achievements, and drive our organization to greater success. Commitment Like a family, we are united by an unspoken pledge, bound by our convictions. We prize dedication, and are moved to help each other and our customers. We accept nothing less than loyalty in our ranks. We are true to each other and to our cause. Passion We wholeheartedly believe in our company; its goals and objectives are our mission, and we enthusiastically embrace them and relentlessly pursue them. More importantly, we truly believe in each other, care, protect and support each other. Integrity Professional. Reliable. Trustworthy. Honest. Our corporate integrity is a critical asset and we are committed to upholding it worldwide. We set high standards, and we abide by them as we practice business fairly and behave ethically. We share our expectations with each other and strive to maintain a workplace built on mutual values, trust and goodwill.