Be an Ethical Entrepreneur, Marketer, and Business Builder

The best way to share and sync files between all of your computers

If you’re like me you have several computers… One at work, another at home, a netbook and/or laptop for travelling… And it’s a pain to make sure you have the files you need available at all times no matter which computer you are on. Until now…

Over the years I’ve tested online document management editors such as Google Docs, Google Wave (which has since been retired), and Zoho Docs; but you need internet access to make them work, you have to use the rudimentary web-based office applications they provide, and you can’t open common file types such as audio files or OpenOffice documents.

In the real world, we don’t always have high-speed internet access, web browsers crash, and our desktop office suite (such as Microsoft Office or OpenOffice) are a lot more powerful and easier to work with.

Now there is a better way and it’s called DropBox. Here’s how it works

  1. You install DropBox on all of your computers and create a login.
  2. It then creates a DropBox folder on each computer.
  3. Move your important files that you want to access from anywhere into your DropBox folder. Don’t copy because then you’ll have different versions and you’ll never know which is the “right” one.
  4. Save all of your important new files into your DropBox folder.
  5. Invite your friends to DropBox and create folders to share with them for work you’re both collaborating on.

You can drop in files from any of your computers and, no matter what type of file you put in DropBox, it syncs each DropBox folder to have the exact same documents all the time. It’s so fast that it will actually sync between computers every time Word does an auto-save. DropBox doesn’t even wait until you’ve closed the file. Even more impressive, it will sync documents simultaneously across Linux, Windows and Macintosh. I regularly switch between Windows and Linux computers and DropBox keeps all of my documents synced.

Even better, you can access your DropBox files from your iPhone or Droid device or from a web browser on any computer. If your laptop dies, just login to your account from any computer and your files are there.

It’s also extremely helpful when sharing documents with colleagues. You can create folders that can be shared with any DropBox user. Currently I have 4 different DropBox folders synced between 3 computers. Two of the folders are shared with clients. One of the folders is shared with my business partner, and the last one is just for my personal information.

If you’re a die-hard Linux fan, Ubuntu One is a great option as well that offers much of the same technology with 2 glaring exceptions. The beta Windows client doesn’t seem to work at all in Windows 7 starter and you don’t get additional free space by referring friends.

The best part of both options? It’s FREE for your first 2GB of space.

Download DropBox and get your documents organized today.

To your success, Bryan

Your small business needs Google Apps instead of Microsoft Exchange

…Or Cpanel or any Linux system or anything else that I’ve worked with.

Why????

  1. It’s free.
  2. It works.
  3. It’s simple.

What more do you need? Don’t you wish all business problems provided a solution that met those criteria?

As I go through this blog I will provide links to the tutorials and programs that I reference to help simplify your implementation so click on a link to learn more. If you need help for setting up a different client, such as Thunderbird, just Google it and you’ll find a solution pretty quickly.

Here’s some background. Google Apps is a way to take your own domain name (like EthicalBusinessBuilder.com) and setup a FREE email management system so you can create custom emails such as bryan@ethicalbusinessbuilder.com. You can then use that within your business to provide everyone with their own email address that can be tied to a calendar, contact list, and Instant Messaging with Google Talk. But wait… There’s more! If you want to get more advanced you can use Google Docs to share documents on the cloud or integrate your calendar  and contacts with your Blackberry, iPhone, Palm, Droid, or other smart phone. The administrator of the account can set permissions on who can see and do what. So for instance, you can define who can access certain Google Docs, who can just see your calendar or who can see and modify your calendar, and who will receive the emails sent to Sales@EthicalBusinessBuilder.com or any other generic email lists.

Besides not costing you a penny, everything is on the cloud… In other words, Google maintains the servers where all of your emails, contacts, calendars, and documents are stored including updates, security and backups so you can focus on your business instead of creating your own IT department.

Other than to keep your local Microsoft vendor in business, is there any reason to keep maintaining your own Microsoft Exchange Small Business server with Outlook???

Every tech geek tells you the latest technology is easy, right? Well this time it’s actually true. Google’s step-by-step tutorials are excellent. They have done a magnificent job of stepping you through the setup. Here’s an example of how to setup Google Apps for your domain hosted at GoDaddy.com. Google has tutorials for just about all of the other major registrars as well. You can be setup and running within about 15 minutes by following their instructions. If you have no idea what an MX record is then expect setup time to take you more like 25-30 minutes. Once you think you have it setup, make sure you send yourself an email to test!

Google has provided a simple tool, again with tutorials, to help you import your emails, contacts, and calendar from Outlook. Keep in mind, that if you’re using outlook to access your email from your local Internet provider, you can keep using the Outlook program on your desktop to access your new Google Apps email address. You would still have all of the benefits mentioned above, but in your Outlook program. Actually, you can even keep your old email address and setup Outlook to also access your new email address all from your existing Outlook program.

So again I ask, why not make the switch???

Now that we have all of the geek stuff out of the way, how does this really help the small business owner beyond the IT department?

  1. Better Communication
  2. Complete Integration
  3. Improved tracking of marketing

By now, everyone has email, but few businesses really appreciate the power of Instant Messaging. Every time you setup a new account in Google Apps they are instantly also on your internal instant messaging program. So what? To better communicate in your office, here are a few ways my small business utilizes instant messaging.

  1. To replace hand-written notes. It saves time and money. It’s faster, it’s instant and it’s search-able. Google saves all of your chats (unless you turn that feature off) and then allows you to search for conversations. Don’t you hate when you lose that paper your receptionist gave you with the phone number to call back? With Google Talk, that’ll never happen again. Even if it’s weeks or months later.
  2. To communicate when you’re busy. If you’re on a phone call and someone in your office needs you, what usually happens? They interrupt. Sometimes it’s for something worthwhile and sometimes it’s not. Instead they can shoot you an IM (instant message) that you can quickly review and determine if you need to end your call or ignore till you’re done.
  3. To stay in touch remotely. With Google Talk integration with your Blackberry, iPhone, Palm, or Droid, you can be connected to your office wherever you are. While you’re waiting in line at the bank, or waiting for a client to show up for an appointment you can respond quickly and easily to your office without having to text. Why is that important? Because texting isn’t allowed in my office. Personal cell phone use is against the rules. If your office staff is allowed to text, then how do you know if they’re texting for business or personal reasons? And if you don’t want to be bothered, simply don’t login to Google Talk on your phone.
  4. To stay connected across multiple locations. Do your sales reps work from home? Do you have multiple office locations? Do you ever take business trips where you still need to communicate back to your office? No matter where you or anyone on your team is located you can communicate instantly with them. You can even utilize the microphone and video features to have a true video conference call which is a great way to have team meetings across multiple locations.

Once you get used to all of the ways IM makes your office run more smoothly you’ll wonder how people ever got things done the “old fashioned” way. We even use Google Talk to communicate with major vendors. How do you use it at your business?

Complete integration is about a few different pieces…

  1. Document and file sharing with Google Docs. If you don’t have a method for remotely accessing your files and sharing them with your team members (like a Windows Terminal Server) then this is a great way to manage and share documents. The biggest drawback is that Google Docs’ folder system is a bit cumbersome to organize and performance is a bit slow even with a high-speed connection. The beauty is that you can have multiple users updating and modifying a spreadsheet or document from different locations in real-time. Google Docs will assign each person a color and any time they start typing in a cell, that cell is highlighted in their color. It’s a great way to collaborate on documents. Realistically, for the small business owner, this feature will probably not be widely used because of its limitations.
  2. Calendar sharing and syncing – With Google Apps, your calendar is linked to your account. That calendar can then be shared with anyone on your team with a Google Apps or Gmail email address. This way your secretary can set appointments for you or your lead catcher can set appointments for your sales reps. I always had a Business and Personal calendar so that I could separate who could see or modify each. The best part is both calendars integrated with my Blackberry so whether I was adding an appointment to my phone or at my desktop, my calendar was always with me. You can create as many calendars as you need so you can have a calendar for each of your service technicians to help manage appointments even though they don’t have access to a computer.
  3. Contact syncing – Don’t you hate it when you add an email or phone number on your computer to find out, when you need to call them, they aren’t in your phone’s address book? Well with Google Apps and a Blackberry, iPhone, Palm, or Droid, that’s no longer a problem. It will automatically sync your entire contact list whether you input the contact from your phone or desktop. Keep in mind, this is all done completely wirelessly utilizing your phone’s data plan.

Improved tracking of marketing is about utilizing email lists. A list is a simple way to create a custom email address that can be forwarded to one or more people on your team. Here are a few ways we utilized email lists:

  1. Tracking sales leads – Our business had multiple territories and each territory was handled by a sales representative. We had a 24 hour answering service who was trained to determine the proper rep based on the territory. In addition to calling the rep, they would send an email to something like chicagosales@ethicalbusinessbuilder.com. That address wasn’t an actual email account, but a list. And on the list was the email address for the rep, the email address for the sales manager, the email address for the lead catcher in the office responsible for putting the lead into our database, and the email to text address for the rep (i.e. 5551234566@sprintpcs.com). So our answering service sent one email that went to all of the important parties immediately. We use a similar system to track all of our web leads as well.
  2. Tracking lead sources – We decided to partner up with a local home builder to market some of our products and wanted to know how many people contacted us based on the handouts he gave his clients. So, in addition to asking people what prompted them to call us, we created an email list for homebuilder1@ethicalbusinessbuilder.com. That list sent an email to the lead catcher and sales manager who then passed it on to the rep. Instantly we know exactly what prompted them to call us.

There are plenty more ways to improve your office with Google Apps so comment below to let me know how you’re flying high on the cloud in your small business.

To your success with firing your IT department, Bryan

You’re a business owner – you did not buy yourself a job!

This is it. This is the most important concept to grasp as a business owner… This colors and influences every decision you make in your business.

Brad Sugars has another way of saying this. His definition of a business is, “A commercial, profitable enterprise that works without me.” Did you read that last part? Without Me!

In other words, if your business requires you then it’s not a business… You have just bought or created a job for yourself. See the difference? Michael Gerber in The E-Myth Revisited refers to this as the owner being the Technician.

Why is it so crucial that your business can run without you? There are hundreds of reasons but I’ll give you 3.

  1. It’s worth more – A business that is sold including a trained, experienced manager is always worth more than one that doesn’t have one. Consider there are basically 2 types of people who buy business. Investors buy businesses to make a return on their cash investment and these guys REQUIRE a trained manager in place. Entrepreneurs often buy businesses to make a return on their money but to also give themselves something to do. In other words, they want to be the Team Leader or CEO. However, if you have one of these people looking to buy your business how hard do you think it’s going to be to convince them that they can buy the business, get the return they want, AND work on what they want when they want? Worst-case scenario they can easily remove the existing manager if they really want to, however most people won’t do that.
  2. You’ll enjoy it more – All business owners want the same thing – A business that predictably puts money in their bank account with the freedom to choose when they work and what they do. The only way that dream is possible is if you have a go-to guy or gal running the operations every day whether you’re there or not. Now if you like actually doing the plumbing for your plumbing business or tax returns for your accounting business who is going to tell you not to? No one. You’re the owner. You can still choose what you want to do when you have someone else in charge of putting out the fires.
  3. The business will be better for it – If your job and responsibility every day is to work ON your business and not IN it, what do you think is going to happen to your business? Let me tell you. It’s going to get better. When you can start spending your time working on improving your referral system, customer experience, team building and retention, and shopping for better vendors (you know, all those things you don’t have time for now) isn’t it obvious that the business is going to be better?

So if you’re the technician in your business and there’s is just no way you’ll be able to leave for 3 months on a European vacation and return to a healthy business what are you going to do?

You basically have 2 options:

  1. Teach yourself everything you possibly can about building a business to run without you. In other words, learn about business. Not your specific business or industry or niche. Just about building businesses in general. To do this, you’ll realistically need to read about a hundred books and put into action all the things you learn from them. Start with the books on my Entrepreneur Books list. You’ll also want to start learning from owners whose businesses do run without them and start attending seminars and webinars to help you learn how to maximize 3 essential parts to every successful business – Sales/Marketing, Finance/Accounting, and Service/Operations. If you’re this kind of hands-on, self-taught person, then by all means take this route. This is obviously what I have done and continue to do. It will literally take you several years and in the process you may realize that your business just isn’t capable of that vision and decide to sell it and look for one that can accomplish your goals.
  2. Work with a Business Engineer to help get you on the fast-track. Enlist the help of someone who has already done the items in number 1 with one or more businesses and who can quickly evaluate the status of your business and help you put together the plan to move it to the next level. If you’re located anywhere in the US or Canada and have Internet access and a phone line, we can help. Contact me to learn more about the process. You can also read my blog about why business coaches and consultants won’t work to get a better idea of what Business Engineering is all about.

So what are you doing to do today and this week to take that step from a job owner to a business owner? Don’t put it off. If nothing else, email me saying you enjoyed the read and would like to try either option 1 or 2 above and would like to know where to start.

To your business-owning success, Bryan

How hippies created the New Rich while influencing your ideas of time and money

If you don’t know who the New Rich are keep reading because we’ll get to that… First, some history on how they were created… The history is important because it will explain a bit about your personal conflicts and struggles in balancing work and a career with your need for excitement and family.

Let’s start 3 generations ago… Think post World War 2 and the 1950’s – commonly known as the baby-boomers. These people viewed jobs, income, being rich and, quite frankly, a whole lot of things differently. Life for the average American was pretty straight-forward:

  1. Go to school
  2. Get a job
  3. Keep job for life
  4. Raise a family
  5. Go to church every Sunday
  6. Teach family athletics, manners, and respect
  7. Take vacation every year
  8. Get the entire family together for major holidays
  9. After 40 years retire with the money you saved, move south, golf and/or fish and spend time with the grand kids
  10. Being rich means having a nicer house, car, and boat than your neighbors.

Life was centered around family and work. Pay was based on a combination of:

  1. Education or Skill
  2. Experience
  3. Number of hours worked

In other words you put in your time in the form of schooling, work-experience, and a long work-week and you were paid well.

Then in the 1960’s and 70’s the hippies came along and decided they didn’t much like their parents out-dated, sheltered, closed-minded and limited view on the world. They questioned and reexamined everything they were taught and decided life was about new experiences more than family or a steady-income. Their lives were a bit different:

  1. They found new experiences in drugs, travel, music, sex, politics and just about anything else.
  2. They stopped going to church or at least as much.
  3. They stopped having large families.
  4. They stopped keeping the same job forever.
  5. “True” hippies tried not to work at all or just enough to fund their next adventure.
  6. Work was no longer a sense of pride but simply a means to an end. A job. Work became a 4-letter word.
  7. Retirement? Don’t you have to have a job to retire from first?
  8. Wealth is about having more experiences and a better understanding of yourself than your neighbors.

Sunset over Jackson Lake in Grand Teton National Park

However, even with their new ideas about the world, pay was still based on the 3 items listed above and all directly related to time input. Obviously not all members of the hippy generation decided to travel down the hippy highway. Quite a few followed in the footsteps of their parents and particularly the “work hard to get ahead” mantra stuck with them. However, they couldn’t fully escape the free-spirited influence of their friends.

Then comes along generations X (1962-81) and more particularly Y (1982-98). We are being raised by parents and in school systems that try to educate us to, “work hard to get ahead” and to “put in your time and it will all pay off.” While at the same time being taught to have balance in our lives. Don’t become a workaholic. Take time to see the world since travel is so cheap these days. And the advice I’ve personally heard about 1,000 times, “take the time to do all of those things while you’re young.” Apparently the solution to the conflicting worldviews of the hippies and the baby-boomers is to be a hippy while you’re young and enjoy all the great new experiences that you can handle and then “settle down” and follow the baby- boomers’ formula for success as an “adult.” If you’re Generation Y you know exactly what I’m talking about… Because you’ve heard it, too. If you’re early in Gen X or a baby-boomer, you’ve probably said it… 🙂

Come again? I’m supposed to see the world and race motorcycles and skip church and experiment in my 20’s so that I can “get it out of my system” and then somehow be content the rest of my life making the proper decisions, raising a family, working a steady job, and limiting travel to occasional vacations?

I promise you, that plan does not work. How do I know this? In August, I’ve failed to publish any new blogs because I took a 17 day, 5561 mile, 10 state, 9 national park motorcycle journey throughout the west. The following story has happened to me in some form dozens of times, but here’s one example of how that desire for freedom, expression and new experiences can never be satisfied once you’ve tasted it.

My bike outside of Death Valley NP. FYI: Don't ever ride thru Death Valley in August!

As I’m walking to my motorcycle from the shower facility in Yellowstone National Park I notice a minivan parked next to me with 2 cute little girls running about, both sliding doors and the rear hatch open, a wife running around doing motherly things, and the husband just standing there waiting for me… He’s literally looking straight at me as I walk toward my bike. My bike is fully stocked with saddle bags, camping gear, and everything you need for an extended vacation and this guy noticed… After some small talk while his wife gathers the necessary tools for their showers I ask him if he rides. He HAD been smiling. His wife immediately stops for the first time and with the-smile-that-says-a-thousand-words looks straight at him. He looks at her and I couldn’t help but remark, “Uh oh, your wife is listening to your response so you better get it right.” She doesn’t flinch or take her eyes off of him. He smiles and says, “Yeah, I ride dirt bikes now.” The Mrs. goes back to her motherly duties satisfied with his answer. I bet you can guess his advice to me… “Do it while you’re young.” That was the second or third time in 2 hours that I’d heard that advice. I’ve lost track of how often people tell me that.

Did you catch how he ended his sentence with, “now”? Yeah, me too. Granted this man had a beautiful wife, 2 super-cute little girls, and enough money to take a week long vacation with the family to one of the most awe-inspiring places on earth. He was living the baby-boomer dream… But if you could have seen his face and the way his eyes were transfixed on my motorcycle it would be immensely obvious that something was missing… He had tasted that freedom and adventure, which for him happened to be on a motorcycle, and he wasn’t fully satisfied with his new stable, predictable life. Would you be??? Or if you’re not there yet, will you be? Can you have both that stability and some freedom? Issues with your better half aside…

Along comes what Timothy Ferriss calls in The 4-Hour Workweek, the New Rich. Thanks primarily to the shrinking of the world due to increases in technology, people have started to realize that you can work from anywhere. For 2 years I worked out of the basement of my home for a software company 620 miles away. While taking pictures in Oceanside, OR last week a nice couple told me they moved there and out of the city because the husband “telecommutes” as a software engineer 700 miles away to San Francisco.

In addition, people have realized when you don’t have to deal with small talk at the water cooler or talk to your co-workers about last night’s episode of Survivor you can get a lot more done a lot more quickly. In other words, when working remotely, you can do so more efficiently. This is what the New Rich are all about. The ability to work from anywhere more efficiently than their co-workers sitting in an office.

There’s more to the story thanks to the hippies, though… As I mentioned earlier, the baby-boomers always thought you traded hours for dollars. More time equals more money. Over time you can save enough money in your nest egg to pay for the time where you won’t be making money in retirement. The New Rich don’t see it that way… As a matter of fact, that’s all wrong. Whereas conventional thought values a person’s wealth based solely on their bank account and possessions, the New Rich consider 2 things:

  1. Cashflow
  2. Timeflow (yeah, I just made that word up)

Cashflow – If you have a steady income, you don’t need a nest egg. In other words, if I have a business that makes me money every month, why do I need a million dollars to retire? Your answer to that should be – “Well you need to work in that business if it’s going to make you money and if you’re working you can’t do the things you want to in retirement.” Good answer. But you’re wrong. It is possible to have cashflow without giving up your life and all of your time. Besides, what good is having all the money in the world if you don’t have the time to enjoy it? Just as importantly, when you’re 68, will you be able to enjoy the same adventures as you can when you’re 28?

Timeflow – I’ll use an example to explain this concept. If you’re a lawyer and you make $208,000 per year and work 80 hours per week, your hourly income is $50/hour. You’re now one of the top income earners in the country and, with a reasonable savings and investment plan, will be rich in short order, right? What if, however, I make $52,000 per year, have no office, can work from a cafe in Jackson Hole, WY or a beach house on the Outer Banks of North Carolina, and only need to work 5 hours per week? Only one hour per day. That translates to $200/hour.  More importantly, I have an extra 75 hours of time that I own, control, and is available to me every week. That control of your time is what I call, timeflow.

Now for the tough part, which is more valuable? Which is more important? This isn’t a trick question. One of them is truly more important and more valuable than the other.

It’s your timeflow for one simple reason: You can lose all of your money and get it back, but once you’ve given up your time, it’s lost forever.

That being the case, when was the last time you went into a performance review and asked for more vacation time instead of a raise? What about when negotiating for your job? Did you offer to give up a week or 2 worth of pay for additional time off? If your time is truly more valuable, what are you doing to improve your timeflow at work or in your business???

If you understand that concept, you understand what it’s like to be the New Rich. To become one of the elite members of the New Rich community you need to work on 3 things:

  1. Cashflow
  2. Timeflow
  3. Mobility

The best way to achieve these 3 things is to own your own business. That business can be a brick-and-mortar, main street style business as Brad Sugars suggests and I have owned. Or it can be an internet business that simply resells products as Timothy Ferriss suggests. Either way, the business has to be absentee-owned so, whether you’re there or not, it’s putting money into your bank account. If the business you’re looking to buy doesn’t allow for absentee ownership, don’t buy it. If the business you own doesn’t provide that option, sell it.

So how did the hippies create a group of people with such financial and business savvy? Well they didn’t do it on their own. The hippies simply taught us the importance of timeflow. They reminded us of the human-spirit’s desire for new experiences and to see new places. The baby-boomers taught us that, to enjoy those things, you still need money. The Generation X and Yers have put those together, wrapped it all up in the latest communications technology, and created this new breed of entrepreneur. Once you’re a member of the New Rich you can decide if you prefer the cars, motorcycles, and boats in the style of the baby-boomers or the travel and experiences in the style of the hippies… That’s the beauty of their lifestyles. They’ve created a way to do what they want to do when they want to do it. You can learn to do the same.

Whether you own a business or have a job, hopefully by understanding how the New Rich are finding balance in their lives amongst all the conflicting information they were taught by their parents and educators, you can better achieve a timeflow and cashflow balance in yours.

To your balanced success, Bryan

P.S. If this makes sense to you and you’re interested in learning how to go about acquiring your own business start with The Fundamentals. If you already own a business, you need to learn how to start improving your timeflow. If you’ve owned that business for any amount of time you may really need to consider moving on and buying one that can truly help you achieve your goals. You may also email me directly for more help.

Why a Business Consultant or Business Coach won’t work!

To make my point, I’m gonna start with a lesson I’ve learned as a Mechanical Engineer studying, designing, building, and racing cars in college.

This past week I was brushing up on vehicle dynamics by thumbing through an engineering text I received at the OptimumG training put on by Claude Rouelle. The first story the book told went like this. The top 9 drivers in qualifying at a recent Nascar event (Virginia 500 2002) were separated by .1 second (.5%). The top 15 drivers in qualifying at a recent F1 race (Austria 2002) were separated by .8 seconds (less than .8%). Business works the same way, you don’t have to be 2 or 3 times better than your competition to get more business. You literally only have to do a few small things better and people will choose you. This is what’s meant by the “law of the slight edge.”

Me autocrossing my 2006 G35 at BeaveRun in 2007.

So how do you obtain that “slight edge” in racing? An engineer has 2 ways to address a problem. A driver goes out for a 6 lap test drive and says a car has a lot of understeer. The engineer adds 2 degrees to the front spoiler and sends the driver out for another 6 laps. Now it understeers less but still understeers. He adds 2 more degrees to the front and the driver heads out for another 6 test laps. Now it oversteers so the engineer subtracts 1 degree from the front spoiler and again out for another 6 laps. Finally the engineer adds another half degree and after 6 more laps the driver confirms that the handling is neutral. That took a LOT of time, money, rented track time, and energy. A total of 30 laps to accurately setup and test the car to come up with 3.5 degrees added to the front spoiler. This is how most business owners tackle problems.

A better way to improve the car is for the engineer to listen to the driver indicate understeer, evaluate the data (because he knows the correct data to review AND how to interpret it) to determine the cars Aero balance is at 36.9%. Then he compares that data to when the car was setup perfectly on a similar track and determines that an aero balance of 38.3% is needed. He makes a single adjustment to the front to add 3.6 degrees and the car is perfectly neutral the first time. A total of 12 laps and he knows the car is setup well. This is how business owners should tackle problems.

Now before you start saying, in the real world of business and dealing with people things are never that perfect. In reality, in racing it’s never that perfect either. Drivers are good, but they aren’t that good. They also aren’t generally very consistent and, in reality, they aren’t “sensitive” enough to feel slight variations. Moreover, weather, cross-winds, other drivers on the track, and a thousand other items can make choosing a “perfect” setup challenging. Which is why we’re never looking for perfect. We don’t need to be perfect. We just need to have a slight advantage over the competition.

That’s why the Team Leader for our race team used to point out to us when we were getting TOO wrapped up in the perfect simulations or calculations that “We’re engineers not scientists.” In other words, we live and work in the real world where your gut instinct and experience will ALWAYS be a factor in making decisions because you’ll never be able to test every single variable. On the other hand, scientists setup controlled environments so that they can test and control each variable.

As a business owner, your job is like that of the engineers relying on science, data, driver-input AND experience to make the best decisions. And that is why business consultants and coaches don’t work! Let me explain.

For that engineer to make the best decision for his racecar, a few things have to be present:

  1. Experience
  2. Data on his car
  3. Comparable Data for that car running on other tracks
  4. Ongoing support and testing because each track is different and even the same tracks can vary

The same is true of someone who wants to help you improve your business.

  1. They need experience in running, owning, AND analyzing a business. Business coaches and consultants can both reasonably have this prerequisite.
  2. They need data about the business. In other words, when a car is setup with hundreds of sensors to acquire data, they need to not only have access to that data, but they also need to know how to look at the relevant data and discard the irrelevant information. If the consultant or coach could reasonably have this skill however, there are plenty out there who are looking at the “wrong” numbers or skipping over some of the most important data. Quite often, they over-complicate it. For instance, in the example above, the engineer could have considered tires, anti-roll bars, springs, aerodynamics and even driver error in getting the car setup correctly. Experience told him exactly which data to review, however.
  3. For comparable data, your coach or consultant needs experience AND data working with similar businesses. Think about it for a second. What conversion rate is reasonable for your business? If you have an accounting office is your conversion rate going to be the same as a woman’s clothing store? Probably not. When you have comparable data, you can now better determine which areas present the greatest area of improvement so that your time is always being invested on the projects that will give you the best ROI. This is where the rubber of the 80/20 rule meets the road. Just because you know there are 20% of things you can do to give you 80% of the results, doesn’t mean you know WHICH 20%. Industry specific consultants and coaches may have this data and experience, however most consultants and coaches are trying to be everything to everyone so look out for this.
  4. Finally, the variables on the racetrack and in your business are ALWAYS changing. It’s not enough to be given a plan of action by your consultant and then be asked to implement it as he walks out the door (as is normally the case). It’s also not enough for your coach to call you every week or month and tweak your plan for real-world circumstances. To be truly effective, that coach needs to be constantly comparing your business to other similar businesses and providing you with input. Along the way both of you will develop the experience needed to make better gut choices when everything can’t be calculated and moreover, you’ll better understand how other similar businesses are tackling the same problems you are. No business owner, coach, or consultant will have all the answers so continually reviewing problems and solutions from a group of similar businesses can help everyone involved more quickly achieve excellent results (i.e. more profits with less time input).

As you know by now, I don’t write about problems in business without offering a solution. The solution is the Small Business Engineer leading a team of small business owners in the same industry. Just like the engineer at the racetrack, the Small Business Engineer will continually work with the driver (i.e. owner) to gather real-world feedback. He’ll help you determine exactly which data (i.e. reports) to be watching and help interpret the changes. He’ll provide data from similar racetracks (i.e. other businesses in your industry) to help you get up to speed more quickly and determine which 20% you should always be focusing on.

Whether for a business or a racecar, the engineer’s job is to help improve the problem as quickly, effectively and cheaply as possible. Once that’s done, your business can now have the slight edge it needs to blow away your competition.

If you’re interested in learning more about working with the Small Business Engineer, comment or email (bryan@ethicalbusinessbuilder.com) me.

To your business-engineering success, Bryan

P.S. For more information on what numbers to watch in your business, check out my 5 part series on how to fix your business fast.

How to get the BEST deal on your next car purchase

At the moment, I’m negotiating for a new car, and I’ve learned a few things:

  1. If someone won’t negotiate with you via phone or email, they’re not real interested in negotiating with you in person. This happened to me twice. It wasted a lot of my time and energy and really annoyed me since they weren’t willing to make any good deals in person but assured me if I came to the dealership they would give me a great deal.
  2. They can give you a very close estimate of your trade-in, sight unseen. Don’t let them tell you you need to drive 3 hours in one direction to get that information.
  3. Whatever their first offer is, ALWAYS deny it. Do the same with the second offer, they can ALWAYS do better. In other words, BE PATIENT. How much better? Well upon my first phone call one dealer gave me a price of 36,000 and 0%. Second call he offered 31,000 and 0%. Third call he offered 31,000 and 0% and 18,000 for my trade-in. Fourth call he offered 31,000 and 0% interest and 20,500 for my trade-in. So from first to fourth call, we’re talking about a swing of about $7500. :-O  And I know I can get the price down even more. 😉 Another dealership, without even me prompting dropped the price on a car by $1000 from one weekend to the next. They didn’t even call me, they just emailed the new better offer to me.
  4. Invoice prices that you see on Edmunds.com and similar websites don’t mean a thing. One dealership I went to had a “Market Adjustment” markup over MSRP for Mitsubishi Evolutions of over $3,000 and they wouldn’t even drop the price to MSRP!!! Another dealership across town agreed to sell me the same exact car for $3,000 under MSRP which was about a $1000 less than invoice. Do you really think that car dealer was going to sell me a car at a $1000 loss? Of course not. The salesman needs to get paid as well as the dealership. The invoice price doesn’t mean a thing.

As I mentioned in my blog about selling to the Internet Generation, we know how to get a good deal. One of the ways we can the best deal, is by being “dispassionate” about the purchase by negotiating via email and phone. If you didn’t just get out of test-driving a fresh, new car, it’s hard to make that split second decision to buy it cause it makes you feel good. Car dealers HATE unemotional buyers! As a matter of fact, they feed on them. That’s why they want you to test drive their cars, they’re convinced that you’ll give them the valuable information they need about how much you love the car so they can sell you that car. Granted, as Dave Yoho used to say, “There’s no such thing as an unemotional, dispassionate buyer, who buys solely on merit.” I’m no different. So the question is not whether or not I’m going to buy the car, it’s just what do I have to do to get the best deal. And therefore, which dealer will I purchase from.

How dispassionate can I be?  I make up a spreadsheet with the numbers I want to see based on the 5 year cost of ownership of the vehicle taking into account gas mileage, insurance, car payments, and up-front costs. If the numbers in the spreadsheet aren’t where I want them, I walk out. I even tell the car dealer that. “Hey I appreciate your time, however this is what I can afford, if you can’t make money on this deal, I’m not going to ask you to sell me the car. I’ll just wait till I sell my car at a higher price.” That’s when they start coming back with better offers. 🙂

It’s worth noting that this is definitely a buyers market. With the sluggish economy car dealerships are hurting and are much more willing to make a deal now than they were 2 years ago. It’s not your fault that they need to badly sell cars. They don’t have to accept any offer that you put forth. As a matter of fact, you’re trying to help them out by buying a car from them. Always keep that in mind when negotiating for a car, business, or anything else.

To your negotiating success, Bryan

Owning a business MUST be part of your wealth generation strategy

The reason for this is actually extremely simple and direct: Taxes

If you could consistently make 20% MONTHLY returns in the stock market you’d still benefit from a small business. Realistically, I can’t think of a single reason not to own a small business. Even if the business only employs you, there are tax advantages though there are certain advantages, such as healthcare, that are only possible with people working with you.

Keeping in mind that less than 12% of millionaires, according to The Millionaire Mind, are professionals (i.e. doctors, lawyers, engineers, etc.) and the vast majority create their riches through building a business, that’s actually beside the point. My point in this blog is simply that owning a brick and mortar business has many advantages that even your 1-man-show-no-employees-to-deal-with internet business can’t match. Let’s look at a few:

  1. Taxes
  2. Room to cutback
  3. Health Insurance
  4. Retirement Accounts

The quantity of tax advantages possible with a small business are for more numerous than a short blog can cover so I’ll touch on a few highlights:

  1. Pre-tax Expenses – Your gross pay is meaningless. Your net pay is all that matters and when your phone, internet, car, car insurance, business meals, and travel are all paid for by your business the savings are huge. As an example, if all of those pre-tax expenses add up to only $10,000 per year and you are in the 30% Federal Income bracket, have 5% state income tax and have to pay 15.3% in FICA (7.65% from the employee and 7.65% from the empoyer) you’d have to pay yourself over $20,000 in salary to afford the same expenses. If you own a business and those expenses only amount to $10,000/year you probably need a better accountant. Keep in mind you have to be honest about the use of those items. For instance, my company doesn’t pay for my entire cell phone bill because obviously I use the cell phone personally a portion of the time. The same is true for my vehicle allowance.
  2. Distributions – When you have a pass-thru entity you have to pay yourself a “reasonable” salary and the rest of the profit you can take as a distribution without paying any FICA tax (a savings of 15.3%).
  3. Racing This is probably my favorite! In essence, if you like racing cars, motorcycles, airplanes, bicycles or have some other hobby and you don’t mind plastering your race vehicle with your business’ logo, then your vehicle and most of the expenses related to racing can be paid for pre-tax as a marketing expense for your business.
  4. Real Estate – If your business requires a building and you own the building in a separate entity (most likely an LLC), your business can rent the building from your other entity and the rent is passive income that isn’t subject to FICA (again saving you 15.3% over a salary). Obviously the rent has to be reasonable.

As you can see, just these few items can quickly add up to tens of thousands of dollars in tax savings even with a business grossing less than $500,000 per year. Obviously, the larger the business, the greater the savings.

By room to cutback, I simply mean that if you have a business that employs just you and sales drop, guess who the first one to get fired is? On the other hand, if you have a business with just a dozen employees and sales start dropping now you have a lot more room to cut payroll before you’re out of a job or taking a pay cut. As a small business owner, I know personally that cutting others before you cut your own pay is extremely difficult to do, but you can’t deny that, if necessary, you and your family have a bit of extra security.

As for health insurance, if you have a few employees (at least prior to the new Healthcare Reform Bill) there were health insurance advantages to being on a group plan such as your rate is primarily based on your age and not pre-existing conditions. I learned this first-hand as I couldn’t get insurance as an individual but had no problem getting on my business’ plan.

Since it’s your business, you get to structure your SEP-IRA or other retirement vehicles in any way that you want. Of course you have to make the accounts available to everyone on your team, however you have the ability to structure the accounts to best benefit you. This power can have a major impact on your overall tax bill today and into retirement, so don’t overlook it.

Finally, if you’re looking for what type of entity to create, I highly recommend an LLC filing as an S-corp. Also, make sure you have a GREAT accountant to take care of all of the details of these tax advantages and to make sure you’re doing everything legally and ethically.

To your tax-saving success, Bryan

Take back your schedule, business, and life.

In that order.

For the first time in 2 years, I spent a few days in the last week onsite at other businesses doing some consulting and training. Since I’ve been working on my own business, I just hadn’t the time to put a lot of effort into helping others. After a few days of interfacing with some very successful small business owners, it intrigued me how interested they were in my own personal daily schedule…

A few months back I noticed sales were slipping and my stress level was rising rapidly. In those moments, when you finally realize that in the last 5 working days you got absolutely nothing of value accomplished, you really need to step back. Sit in your office with the door closed or take an extra long shower since you’ll have no interruptions and evaluate a few things:

  1. What is your role as the business owner/leader? Literally, what is your job description and are you following it? No job description? Make one!
  2. What can you do that would most benefit the company in 3 months, 6 months, 12 months, and 5 years? Forget about what’s needed to get through today for a few minutes and focus on longer term. Unlike public companies, you don’t have next quarter’s earnings report to cloud your long-term judgement.
  3. Are you spending half of your time on marketing/sales (getting new customers) and half of your time on customer service/operations (taking care of existing customers)? Granted, your sales and marketing efforts should certainly include marketing to your existing customer base, but do not make the mistake of convincing yourself that that ONLY means dealing with current customer issues. Your sales/marketing efforts to existing customers mean up-selling, cross-selling, educating them on all the products and services you offer along with gathering referrals and testimonials.
  4. Does your schedule allow you to achieve 1-3? Obviously, this is where most business-owners, myself included, often get side-tracked.

So what can you do about it? The answer is simple, create a daily or weekly schedule.

Initially my daily schedule looked like the following:

8-9:30 review schedules, answer any questions for service and address any service issues
9:30-10 Review and Respond to emails
10:00-11:00 Customer Complaints, Personnel issues, Inventory checks, Office Questions
11:00-12:00 Service quotes, Business Accounting, Financial Reports, Daily reports,Taxes, Insurance etc.
12:00-1:00 Lunch
1:00-2:00 Improve Processes, Procedures, Checklists, Scripts, and Handbooks
2:00-3:00 Marketing
3:00-4:00 Sales and Customer Follow-ups, Office Questions
4:00-5:00 Payables, Billing Questions, Payroll, Emails, Etc.

However, after realizing that the “creative” processes of Sales and Marketing weren’t really as effective in only an hour time-slot I converted to a weekly schedule with 2-hour blocks for Sales and Marketing in the afternoon and my standard morning schedule. Personally, I define Marketing as everything my business does to get a prospect to contact us to solve a problem. Once the prospect has contacted us, they are now in my sales process/system. Everything from that point of contact, till we sit down with the new customer after our work is finished to make sure they’re happy and to gather referrals, is Sales.

Monday through Thursday I alternate between Sales and Marketing and Friday is a “flip” day where I choose which one will benefit the business more (or whether I need to just go for a motorcycle ride).

So now that you know what needs to be done, do you have any doubts that in 3, 6, or 12 months, let alone 5 years, your business and therefore you will ultimately benefit from such dedication to your job description as the business leader???

Businesses generally mimic their owners according to the 3 Leaders every business needs. If you’re sales oriented you’ll love that time spent working on sales and marketing. If you’re a more technical, hands-on guy, you’ll feel much more in your element taking care of the customer issues and making them happy. If you’re a numbers person, that time from 11-12 and 4-5 where you work on payables, reports, and other accounting needs will be right up your alley. That being the case, you have 2 options:

  1. Commit to taking care of all of these items yourself.
  2. Hire someone else to help you in the areas you aren’t good at or passionate about.

If you choose the first, my Recommended Reading section is a great place to learn about books that will help educate you on all of these areas.

If you choose the second, I’d read some of the books anyway so you know if the team member or consultant you’re working with really knows her stuff. There are plenty who do not. The first item I would outsource would be the accounting stuff.

My blog title obviously infers that just by setting your schedule you’ll now have a sense of control over your business and more importantly your life… The only proof I can offer for that is to try it. Force yourself to make it a priority to follow your schedule and you will be utterly amazed at how productive you can be.

To your scheduling success, Bryan

P.S. At our weekly Team Meeting I apologized to my team for not doing my job and let them know about my new schedule. I recommend you do the same so everyone knows things-are-a-changin.

How to fix your business FAST – Part 5 – Build Recurring Revenue and Prioritize

There are 3 reasons to build recurring revenue to fix your business:

  1. It can generate immediate cash.
  2. It will generate consistent cash over time.
  3. It will increase the value of your business if you’re looking to sell.

Since your business is struggling, building recurring revenue by offering payment plans for your equipment and services is not what we’re focusing on right now. At the moment, we need to generate cash today with little up-front investment, which I covered in detail in my blog on this topic. For that reason I won’t spend any more time on it again. Since August 2009, my business has created an additional $314/month in recurring revenue. That doesn’t sound like a lot (and it certainly isn’t considering our potential), however we’re just starting this program, everyone is still learning how to sell it, and our up-front costs, for a predictable $3768/year, are very close to nothing. Our goal is to have $500/month by 2010 and $3000/month by 2011.

In reality, the idea behind building recurring revenue and improving your sales and marketing is the same. Your goal at these last 2 steps is to develop a way to create consistent cashflow. Whether that means you need to sell something new to your customer again and again, or you need to bring in new customers regularly, a great sales and marketing system will generate predictable income for your business. I would venture to suggest that if you had a sales system in place during boom times, you wouldn’t have nearly the problems you do now in a slow economy.

So let’s summarize once again what it takes to fix any business in trouble (and though I write passionately for small businesses, nearly everything can be applied to Fortune 500 companies):

  1. Change yourself – By making a commitment to do so, particularly by working ON your business instead of IN it, and making by making lists.
  2. Know your numbers – If you don’t know where you are, you have know idea where your problems lie and can’t develop a plan of attack to fix them.
  3. Cut Costs – As drastically as necessary based on your current circumstances.
  4. Improve Efficiency and Productivity – Since your business is not doing well, your profit per person is obviously lower than it needs to be for you to succeed.
  5. Improve Marketing and Sales – Though this is number 5, you need to work on it along with the rest to make sure you always have money coming in.
  6. Build Recurring Revenue – Make this a priority. It can help you through the next tough time.

Several times I’ve mentioned the importance of lists, systems, and procedures. These items are not just for your team members, they’re for you (and me). You need your checklist to fix the weak links in your business systematically without losing focus. You also need a daily schedule to block off your time for each of the 6 items above. You literally need to block off time for each one without any phone calls, emails, door knocks or other interruptions.

My final bit of advice is 3-part:

  1. Steal the best ideas you can. This can be from your competitors, other similar business, businesses you see on TV, from reading books, asking people who are doing well, taking classes, or almost any other business related source. Granted, there are a lot of people who don’t provide much “meat and potatoes” advice, however when you find a source that does, learn as much as you can. As I like to say, “It’s always better to learn from others’ successes than your own mistakes.”
  2. Apply the pareto principle. 20% of what I’ve covered in the last 5 blogs will give you 80% of the results. The trick is determining which 20%, right? Well if you know your numbers this isn’t that tricky. Your numbers will tell you where you have the greatest potential for improvement. This is how you will prioritize everything.
  3. Know when to cut your losses and move on. If you’ve legitimately done almost everything we’ve reviewed over the last 5 blogs and you’re seeing little to no improvement, you need to move on. Don’t be the guy who holds onto GM’s stock thinking “they’ll never go bankrupt.” Salvage what you can and sell either the whole business or the assets and move to the next project. No amount of money can ever buy you more time, so if your time isn’t being invested in a business that’s moving forward and making your life better, you need to get out of that business.

In less than 5,000 words we’ve reviewed literally dozens of directly applicable things you can work on today to improve your business. Take action and make the improvements.

To your success, Bryan

P.S. If you’re looking for a business to buy, find one that does very few of the things reviewed in the last 5 blogs yet is still making money.

How to fix your business FAST – Part 3 – Cut Costs and Improve Productivity

On the face of it, cutting costs sounds pretty simple. In reality, if you know your numbers, it is rather simple.

Here are some ideas to evaluate for potential cost-savings in any business:

  1. Insurance – whether it’s commercial, auto, or health insurance, if you haven’t shopped around in a few years, you need to. This area alone has saved my small business $9,000 over the past 2 premiums with slightly better coverage. Granted, it took a lot of time and energy to get to that point, but how can you argure with that level of savings?
  2. Telephones – cell phones and land lines can both be EXTREMELY over-priced if you don’t shop around. Make sure you have the best group or individual or combination of the 2 for all of your cell phones. For land lines, if your internet is reliable enough, you seriously need to consider VOIP. VOIP stands for Voice Over Internet Protocol and simply means using internet data lines instead of phone lines for your phones. In my business this would save us about $250/month IF we had reliable internet. Our internet is very spotty, has little competition, and relatively slow so we’ve tested with VOIP several times and just can’t make it work. :-/
  3. Vendors – When was the last time you renegotiated with current vendors OR shopped around to make sure you’re getting the best rates? Through buying in bulk, group purchases (with similar businesses), shopping around, and good old fashioned renegotiating (particularly on things like fuel charges and freight expenses) you should shoot to save 5-10% on all of your purchases. While your at it, double-check your retail price list and make sure your mark-ups are sufficient. We found a handful of items on our price list going for little to no mark-up as we performed this exercise.
  4. Pre-payment discounts – While you’re calling to renegotiate prices with your vendors, be sure to find out if they offer pre-payment discounts. Those are simply discounts for paying early which could be within 10 days, or 10 days after the end of the month, or whatever their terms are. If you consider those discounts can range from 1% to 5% this can be VERY significant. If your business buys $200,000 in products each year, at 1% you would save $2,000 year or$167/month just by paying a few days earlier!
  5. Meals & Entertainment – and all other “discretionary” spending. Are those meals, trips, expensive hotels, etc. etc. etc. really necessary? If they’re an integral part of your business recruitment strategy then fine. But make sure your deducted-meals are actually legit. Meals are only allowed for documented business purposes (i.e. names, place, and business discussed all have to be available to the IRS) and overnight travel. Even then, only a portion of those meals can be deducted. The upper-management of Walmart and Sam’s Club are still required to fly coach and book modest rental cars when traveling just like their founder always did.
  6. Shop around for cheaper services – Every business needs the help of other businesses to get things done. This could be your IT firm, your accountant, lawyer, bottled water delivery company, tire and oil change business, uniform company, or even your payroll company. I’m well aware that it’s very hard and expensive to find a lawyer you trust, so if that’s something you already have, I’d leave that one alone, however the others can be done with relative simplicity. Just changing our payroll from Paychex to Quickbooks has saved us over $100/month (though QB prices have just gone up slightly so the gap is lessening).
  7. Improve Efficiency and Productivity – This is probably the most important of all of them which is why I put them as a separate step in a separate category for fixing your business. This all boils down to basically 1 thing: Paying people for the results they deliver.

In a nutshell, that’s what an efficient, productive business will consistently do. It will pay people for their work. What a novel concept, huh? Now you need to determine if your business is a better model for a Results Oriented Working Environment (ROWE) like I discuss in my blog on Intrapreneurship and Entrepreneurship or whether your business simply needs to get away from paying everyone an hourly wage with no incentives.

Here are the steps to take to increase productivity for every employee in your business:

  1. Make job descriptions – If your people don’t know exactly what their duties are, you as a leader aren’t even giving them a chance to succeed. Everyone needs a job description and possibly even a daily, weekly, and/or monthly checklist to make sure they’re taking care of all of their responsibilities.
  2. Create processes, procedures, scripts, and checklists – This goes hand-in-hand with a job description. If you don’t have scripts to teach people how to handle customer inquiries, procedures for how to track those inquiries, and checklists to make sure nothing has gotten missed you will never ensure a consistent customer experience. Making this fundamental throughout your business is the key to successful franchising. If you want a successful, universally applicable, consistent business, this is your foundation. This will also help you determine who on the team needs to stay and who needs to go.
  3. Know your numbers – My last blog dealt with this in detail so to just make the point quickly… If you don’t know the income and profit per person on your team it’s very hard to develop benchmarks, set goals, and recruit new people who you believe can achieve those goals.
  4. Remove temptations to “cheat the system” – In my business this comes in 2 major forms. No temptation to play on the internet for the office people, and no temptation to take extra long lunches or sneak home early for our service guys. The first is temptation is removed but letting everyone know their internet usage is tracked and will result in dismissal if internet use is inappropriate. GPS systems on our service trucks take care of the latter temptation. Very rarely do I ever analyze either item. Basically it’s just there in case a problem develops.
  5. Incentivize and create healthy competition – I still credit the doubling of our profit/day/technician in large part to converting a portion of technicians’ income to commissions. Find ways to incentivize everyone on your team to do their best.
  6. Get rid of those who don’t stack up – If you’re the kind of guy who hates to let people go and so cuts everyone’s pay instead of just letting the weakest link go, you need to change your practice immediately! There is nothing worse for morale then to have everyone “punished” with lower pay when the low-hanging fruit needs to go (and everyone but you knows that). If you really feel that bad about letting an unproductive employee go, cut your income first before any one else’. To keep costs down, review my blog on how to let someone go without paying unemployment.

Keep in mind, that the more drastic the situation the more drastic the cost-cutting measures required. Act quickly and decisively and move on. If you make a mistake in that process, learn from it.

To your cost-cutting success, Bryan