Be an Ethical Entrepreneur, Marketer, and Business Builder

What are the chances of creating the next Facebook, Google, or Zappos?

Yesterday I was listening to an interview where Ron Morris, The American Entrepreneur interviewed Matt Mickiewicz the co-founder and CEO of 99Designs.com. Matt’s story is quite incredible. He’s currently 27 years old, lives in Vancouver where he grew up, and owns 3 businesses. The 2nd business, 99Designs.com does about $1 million in revenue per month already and was founded in February 2008. It also has 78,000 designers around the world who “compete” against one another through a process called Crowdsourcing. If you’ve never heard of it, here’s how it works:

  1. A business person logs onto the website and says he has a design project for a website, logo, brochures, graphics or just about anything else. He dictates how much he can afford and a deadline for submission.
  2. 78,000 designers and members of the site (only 60% are from the US) can now accept the project, create a design, and submit it.
  3. The business person will now have generally 99 options to choose from and 99Designs.com automatically facilitates the payment to the designer.

For the designer, he now has a potential customer. For the business person, he now has the best possible design at the best possible price and potentially a long-term relationship with a designer he knows does great work.

So how did a 27 year old from Vancouver come up with this? It started when he was 14 and decided to start learning about websites… He started designing websites for local businesses and eventually created a site that offered marketing services to all of the Dot Com companies popping up all over the place in the late 90’s. As Ron puts it, he was selling shovels to the gold diggers during a gold rush. He was still in High School at this time and was bringing in 6-figures… He did point out, however, that he was taking too much time to grow his business and so was never a real good student. Sounds like Thomas Stanley’s profile of a millionaire held true for Matt…

After the Dot Com bubble burst, Matt and his partner started writing articles about website design, html, php and other areas related to web design. Initially he gave everything away for free but one day decided to try to see if he printed and bound their advice if people would pay $35 for that service. He sold 20,000 copies of that first online book and has since sold hundreds of thousands of copies of their many books. That website is still online and profitable at Sitepoint.com.

99Designs.com was actually an accident. Matt and his co-founder of Sitepoint.com stole the idea from someone who came onto one of their forums and said, I need a logo and I’ll pay $100 to whoever designs the best one. Since Matt already had his tribe of followers, they created the website for 99Designs and it immediately took off. He tells the story in more detail in the interview so you listen to the entire interview if you want more details.

Today I finished reading Delivering Happiness: A Path to Profits, Passion, and Purpose, which is Tony Hsieh’s book about his life and how he grew LinkExchange to sell for $265 million in less than 3 years and then grew Zappos.com from zero to $1 billion in sales in 10 years. Moreover, after telling his story, he talks about his purpose in life now as CEO of Zappos.com to help other companies develop a culture of happiness like he has done with Zappos.com. For a current business owner, that final section of the book is the most interesting and valuable but is beyond the scope of this blog…

What was most interesting to me about Matt and Tony was that they were  entrepreneurs from the beginning… Tony says he was always fascinated with making money and discussed his first button-making business in middle school through his restaurant at Harvard and the businesses discussed above. One way or another, Tony was going to figure out a way to make a lot of money. And considering he’s worth a few hundred million today at the age of 36, I’d say he succeeded…. Along the way he discovered he didn’t really want or need all that money but you’ll have to read the book to fully appreciate his whole story…

Viral Loop talks about Hotmail, Facebook, Myspace, Twitter and a dozen other companies that grew to hundred million or billion dollar entities in a very short time… The stories are amazing and inspirational but can also be quite detrimental… How can such remarkable stories be detrimental? Well that depends on what you learn from them.

There are nearly 13 billion websites in the world and all of the ones I’ve mentioned are in the top 1000 (99Designs.com is still relatively small but is currently ranked 2561). That’s the top .0000077% of websites. That’s a whole lot of zeroes. I point this out because none of these current businesses (aside from maybe Hotmail) had any vision of how huge they would be or how much they could potentially be worth when they got started. Why not? Because no one knows exactly what the customer wants except the customer. No one can predict exactly what is going to make money online.

If you’re an entrepreneur and starting a business and trying to create something to compete with a major online retailer keep in mind that you have a .016% chance of getting struck by lightning at some point in your life. In other words, you’re 2078 times more likely to get struck by lightning than to create a top 1,000 website. Granted, creating a major online presence is more than just luck as is getting struck by lightning, but it’s still a tough business to plan.

So let me ask you, do you have the next multi-billion dollar internet idea? Even if you did, you probably wouldn’t know it. Moreover, sometimes internet billions take $10’s of millions of dollars in funding and 3-4 years of unprofitability as Zappos.com, Yahoo.com, and Amazon.com all required. Without a millionaire such as Tony Hseih to back your idea, now what are your chances at success?

The point is you can learn a TON from these and other stories of internet riches and you should always work on those crazy ideas just in case you do have the ability to become the next Mark Zuckerberg or Tom Anderson or Sergey Brin or Jeff Besos or Tony Hseih.

If going for an internet business, the chances of creating a business the size of Matt’s ($12 million dollars per year) is much better, however 99Designs.com is also a top ranked website at 2561. More importantly, it took him over 10 years to build a following so that when the idea for 99Designs.com came up, he instantly had customers and designers… That’s a long time to build a following without even knowing how you’re going to profit from them. So what can you do in the mean time to create an income and some time?

You know the answer already don’t you?

You start buying, building, and selling businesses. Every time you go through that cycle you’ll hopefully upgrade to a larger business with more cashflow. It doesn’t matter if the businesses are internet or brick-and-mortar based, either. As a matter of fact, even Tony Hseih got involved only after the original founder of Zappos proved that people were interested in buying shoes online. Buying an existing business takes out much of the guessing work that a start-up has such as:

  • Will anyone want this product?
  • How much will they be willing to pay for it?
  • At those prices can we make money?
  • Will our business model and structure prove profitable?
  • What’s the potential size of our market?
  • How easy will it be for competitors to copy me?
  • How much will staff, insurance, and overhead cost and will it all be scalable?

And on and on and on… You can’t answer a single one of those questions definitively about a start-up but with an existing business you can answer those and dozens more because someone else already has been answering those questions to stay in business. This can help you to determine more precisely what you’re getting in to and how much you can grow the business. More importantly, with creative financing, you won’t need to rely on Venture Capitalists.

The other major lesson that Tony’s book taught me was, whether you’re running a business that does $1 million or $1 billion in sales per year, the rules are the same. Tony outlines mistake after mistake that he and his leaders made at both LinkExchange and Zappos.com. As I was reading the book I was literally getting upset thinking, “No, that’s not how you run a business!” I’m not saying that because I’m better or smarter than Tony however, many, if not all, of those mistakes can be learned with a smaller business. How do I know this? Because I’ve made many of the same so when I was getting upset it was partially because I could feel his pain. 🙂

The final major lesson was that when you have a strong business model, if you can scale it and become a leader online to a worldwide market your growth is almost limitless. Figure out how to do that and I’ll be reading a book about you.

My final thoughts are simply:

  • If at first you don’t succeed, try another business
  • Learn how to build a business
  • Learn how to grow your business online
  • Keep working on those one in a billion side ideas just in case you really do have a good one

To your entrepreneurial success, Bryan

P.S. What Tony has done with his team culture, something I blogged about over 2 years ago before ever hearing of Zappos.com, is quite remarkable so you’ll be sure to learn a lot from Delivering Happiness.

How do I change the culture in my office or business?

A friend of mine just emailed me today to let me know he’s just been promoted, is now taking on a much larger leadership role where he works, and sales are doing well BUT he’s having ‘people’ issues.

Well who isn’t, right? 🙂 All businesses have issues with unproductive, combative, and poor-communicating employees. But before you can address how to fix those problems, you need to know why people are that way. It’s my firm belief that the vast majority of people don’t want to suck at their job. If that’s the case, why do so many businesses have so many personnel issues?

Here’s a quick litmus test to see if your business is creating personnel issues or you just happen to have a few bad eggs.

Personally I’m not a big fan of the term “managers” as “managers manage resources and leaders lead people”. A hundred little things, like your titles, added together form a culture for your team and team members (not employees) that can affect everything about your culture, including financial results. I’m getting a bit ahead of myself, so I’ll get more into what’s required of a leader in number 4.

  1. The first step is defining the culture you want… Mine is literally called our “14 Points of Culture” that set the ground work for our team expectations. While you’re laying the ground work for your team and culture, you may already have a Vision and Mission statement, but if not, that’s foundational so create that as well.
  2. From there you need to develop a Team Organizational Structure chart with the hierarchy of the leaders in your business. Keep in mind that the 3 points on a successful business triangle are made up of Sales/Marketing, Finance/Administration, and Service/Operations so your Team Structure should make sure someone is excellent at each of those things and has the supporting team to get better. At it’s most basic level, your Organizational Chart would include a Team Leader (CEO) above the Sales/Marketing Leader, Finance/Administration Leader, and Service/Operations Leader who all report to the Team Leader. Underneath each of those leaders will be their supporting teams. Keep in mind that the Team Leader should always dedicate half of his time to sales/marketing and the other half of his time to everything else!
  3. Create job descriptions for every position in your Team Organizational Structure. The descriptions should include expectations, benefits, Key Performance Indicators and benchmarks tied to incentives. No one on your team should ever be able to say “I don’t know what’s expected of me or how to do my job well.” More importantly, you must fit each team member’s skill-sets and passions into the position that will best allow her to express those passions.
  4. Now you start changing the culture by actively leading your team. You provide opportunities for open communication like regular team meetings (even going to the point of picking fights between people and departments). You provide regular and consistent feedback with quarterly performance reviews based on the 12 Questions Marcus Buckingham outlined in First, Break All the Rules. You rearrange your offices according to the rules of proximity. Make sure each of your leaders knows how to use NLP and then train your people. When you come up with new products, ideas, promotions, etc. you work hard to provide systems, procedures, scripts and all the pieces your people need to be successful at implementing new programs. You develop a culture of innovation by requiring people to come up with new ideas without fear of reprisal for “bad” ideas that don’t materialize… And rewards for the ideas that do yield results. You ensure that your leaders all develop relationships with their team members because the most important factor in employee satisfaction is an employee’s relationship with his direct superior.
  5. The fifth piece is probably the hardest, yet most important. You fire, let go, or force out the people who don’t fit into your culture, vision, structure, or job descriptions. You get rid of the people who aren’t contributing to the team and culture immediately. The lost time and energy in trying to “fix” them can almost never be recouped. However, if you haven’t provided for them an environment to succeed (with all of the 5 pieces), you’ll really have no idea if they’re good or not because you haven’t defined the rules of the game, yet. If you’re the leader or manager, this is your responsibility. If your leader or manager isn’t providing this type of atmosphere, maybe you should read my last blog on moving on.

Obviously I just presented a whole lot of ideas and pieces that make up a complex problem in a rather succinct manner. The myriad links throughout this blog will provide additional details on certain topics, however don’t try to make this TOO complex. Problems that are TOO complex get pushed to the back-burner, avoided, and ultimately never solved. Take these 5 pieces at relative face value, work on each of them, and enjoy the results.

For further resources, I recommend the following 3 books to help you change your culture:

  1. First, Break All the Rules: What the World’s Greatest Managers Do Differently by Marcus Buckingham
  2. The Five Dysfunctions of a Team: A Leadership Fable by Patrick Lencioni
  3. Instant Team Building by Brad Sugars

To your culture-creating success, Bryan

P.S. Though it should go without saying, before you do anything else you should foster a highly ethical business environment. Without an ethical foundation, everything else will be overshadowed.

How your business should handle Customer Complaints to turn them into Raving Fans

Oh… You don’t have any customer complaints? Right. I don’t either. This is just for other business owners…  Now that we have that out of the way… Let’s go through our 4 step process for converting complaining customers to raving fans.

This may be the quickest and simple business “fix” I’ve ever discussed and yet may have the greatest impact, so be sure to implement this immediately!

  1. Convince your team to get “on-board” – This step is easy. At your weekly Team Meeting present your team with the number of new customers in the last year who had some sort of previous service experience with your business before purchasing. These would be referrals, current customers making another purchase, leads generated by your service department, or if you have a franchise like me, possibly people who have dealt with your franchise somewhere else. In my business, about 60% of our new sales in 2009 came from people who had heard something about our service. What!? You don’t track your lead sources??? For now you’ll have to guesstimate at this number. Then simply ask your team, “Why are customer complaints bad for us and how many people do you think are affected by each customer complaint?” My team’s answers ranged from 3-30 people. Since I like numbers, they expected me to have an exact number for them. I did not. I just pointed out that even if only 3 people hear about each instance of poor customer service, how many potential new customers are we losing each year? They got the point.
  2. Track Customer Complaints – I don’t care if people are upset you gave them a bad haircut, cheated them out of money with outrageous lawyer fees, think your plumber smelled repulsive, or just doesn’t understand your bills. If the customer is complaining, it’s a complaint. Now that we’ve defined what constitutes a complaint, we need to actually track them. In my office, the same software we use for lead-tracking, scheduling, conversations, and billing has an option to track Customer Complaints along with the contact, time, details, and follow-up person. We can then run reports on all of the complaints by department and/or a time frame.
  3. Address and Fix the problem – All customer complaints should immediately be assigned to someone who can fix the problem. Of course, that person should then fix the problem and update the details of the complaint in your software program. The customer should be notified by telephone about your resolution. Moreover, we address every customer complaint at the weekly Team Meeting in order to keep everyone abreast of poor customer service issues and to come up with ways to prevent issues in the future.
  4. Send a “Thank You” letter – Have you ever been upset at a business? After voicing your dissatisfaction, did you have a few of those companies address and fix your problem? Now, of all of the instances where you actually had your complaint corrected to your satisfaction, have you EVER received a letter afterward thanking you for continuing to be a valued customer??? Me neither. My customers, however, have. It’s a weekly responsibility for one of my office administrators to run a report of the customer complaints, print it out for me to review, and then create “Thank You” letter addressed to each customer. Obviously each letter includes coupons to encourage them to patronize us in the future and almost universally those coupons get used. Can you afford to NOT send those letters and risk losing a long-term paying customer at the cost of $.50 per letter??? As Team Leader, I sign each letter.

Now what about those instances where the complaint isn’t justified, wasn’t our fault, or the customer is quite frankly someone we’d rather not have as a customer any longer? Well whoever takes care of Step 3 should have the foresight to determine that and “resolve” the issue accordingly. I’m a firm believer that not all customers are profitable and certainly don’t want to encourage the customers who suck the life out of my team and I to come back. Moreover, when I review the Customer Complaint report in Step 4, if any are “unjustified” I cross them off the list and so don’t send a letter.

I’ll point this out once again, people who are upset enough about something to complain will tell their friends and family about their dissatisfaction. If you don’t address, resolve, and then follow-up with a “Thank You” letter, your business is undoubtedly losing potential new customers and long-term existing customers.

To your “customer-loyalty” success, Bryan

Employee Motivation – It's about winning!

Have you ever hit a game-winning shot, scored the game-winning goal, or converted the game-winning touchdown?

How about setting a new Personal Record for swimming, running, biking, car, quad, or motorcycle racing while taking first place?

It feels good, doesn’t it? As a matter of fact, there are few things in life that will ever rival those feelings of accomplishment and the adrenaline rush that ensues. For the rest of your life, those moments will be remembered and often relived as you just love to tell those stories. Athletics have the power to evoke such an amazing feeling because they bring together a few main things in one place:

  1. Competition – No one is letting you win or succeed. Actually there are plenty of people hoping you fail so that they can win instead.
  2. Recognition – When you have the ball, or the wheel, or are on the track, it’s up to you. All eyes are on you whether it’s because you’re doing well or failing. When you succeed, they’re all cheering for you!
  3. Public Pressure – You are not behind closed doors. As I pointed out in my blog asking Are you putting yourself out there for criticism? public pressure forces us to be good or embarrass ourselves trying.
  4. It’s not easy – By definition, if everyone could (or even wanted to do it) there would be no competition. You worked hard to acquire the skills and talents you have, that brought you to that moment of victory. In other words, you’re doing something you are good at.
  5. Exclusivity – You’re in front. Everyone else is behind you. Only 1 person can be in that position.

So what does that have to do with employee motivation and business building? Everything. If you can understand and appreciate that feeling and those emotions, you understand what motivates people.

Though I used sports as an analogy there are parallels to this feeling of accomplishment throughout our lives. Here are just a few other ones so you can see the universal appeal of accomplishment:

  1. Getting the girl (or guy) – Especially if you had to take a risk to do so by approaching a stranger and your buddies were watching.
  2. Closing the sale – Especially if you’re paid on commission and you’re in competition with either yourself to do better or to be the best in your group.
  3. Buying a house or car or something of great value – Generally this provides a major sense of accomplishment as not everyone has the ability to do this (except for a few years during the mid 2000’s when anyone could get financed).
  4. Winning a competitive bid – You proved that you are the best and it felt good.
  5. Making a profitable stock transaction – You bought low, sold high, beat the market odds and beat all the “experts” while doing it.
  6. Getting recruited – Instead of being “hired”, someone actively and aggressively sought you out because of your talents.

The list can go on and on… My underlying point is simply this – If you, as a leader and manager, can find a way to bring Competition, Recognition, Publicity, Exclusivity and a Challenge to your business, most people will rise to the occasion and LOVE their jobs because of it.

If you can remember back to those 2 hour practices, or twice a day camps in the summer (3 runs/day at cross-country camp), it was not always easy, fun, or painless. As a matter of fact, the majority of the time it wasn’t fun at all. However, human beings are generally willing to sacrifice and struggle through all of those obstacles because the rewards of success, particularly the feelings that come along with it, are worth it.

Again, though I use sports as my analogy, this lesson certainly isn’t limited to the sports arena so don’t let that prevent you from getting the point.

The other day in my office, I started to ask some of my team about their experiences with sports. Even the ones who “sat the bench” understood what I meant by that great feeling of accomplishment at hitting the game-winning home-run. Ironically, the one who admitted to being the bench-warmer instantly latched on to our current inter-office competition. Every day she gets so excited about it she tells me about every single customer she signs up for this program and then “trash-talks” me for not getting as many as her. She’ll even walk into my office to receive a high-five to commemorate her latest score. Talk about fun and excitement at work! What may be most impressive, is that for all intents and purposes, her job is “secretarial.” Something most of us would never consider to be competitive or exciting.

Let’s take this concept one step further. According to Marcus Buckingham in his book “First, Break All the Rules: What the World’s Greatest Managers Do Differently,” the primary motivator for most people at their job is not how much they make. The primary reason for someone leaving or staying at a job is their relationship with their direct superior (remember that coach you hated or loved?). Take a moment and recall some of your favorite stories about your life. How many of those were directly related to your income at that time? Even your stories of accomplishment at work are rarely simply “I got a raise.” The accomplishments you made to get that raise are what makes for a great story and the true sense of accomplishment. The raise was simply the reward (i.e. winning the game) for showcasing your talents.

So to take this concept full-circle, compensation should be tied to these competitions and other measures of success. This is why I’m not a fan of an hourly wage. An hourly wage does not incorporate a single one of the 5 items that motivate people to make sacrifices for success. Admittedly, several of my team members are at least partially compensated hourly. The biggest problem with this is obviously that it breeds complacency. Once you’re used to getting that $10/hour, you are no longer motivated to keep working hard to get it. It’s a given; it’s guaranteed; all you have to do is show up.  What kind of motivator is that???

Great coaches, great leaders, and great managers find ways to motivate their team members to do their best by rewarding them for their talents.

To your “motivational” success, Bryan

P.S. Since you’re the coach of your team, make sure your competitions and motivators encourage both individual and team performance. ER9Y2V4W6YK5

How to fix your business FAST – Part 4 – Improve Marketing and Sales

For most businesses I’ve encountered, the greatest improvement in marketing would simply be to start tracking your ROI. In other words, you need to know your cost/lead and cost/sale for each marketing project. I address this concept in detail in my blog on Scientific Advertising.  Keep in mind that simply asking your customers “how did you hear about us?” can be somewhat futile (though it’s better than nothing). Michael Corbett suggests simply watching your sales to see if they go up with your current marketing or stay flat. To me that seems like a rather unscientific approach since that doesn’t tell you which marketing produced the results and there are  more factors than marketing alone that can affect sales.

There are a handful of marketing books in my Recommended Reading section, in addition to My Life in Advertising and Scientific Advertising by Claude Hopkins, so I’m not going to directly address the difference between good and bad marketing. After all, no one knows exactly what will generate the best response until it’s tested and measured.

That being said, here are a few marketing pointers in addition to knowing your numbers:

  1. Have a Unique Selling Proposition that sets you apart from all of your competitors. In other words, create a niche only you can fill.
  2. Know and understand your target audience. You can have the best offer, and the best advertisement in the world, but if it’s directed to the wrong audience you’ll get zero results. Spend the most marketing time on getting your message to the right people!
  3. Keep a detailed customer database so you can cross-market constantly. If someone has bought from you once before, they are MUCH more likely to buy from you again. If you don’t have a database (or your not using the one you have) change that immediately!
  4. Offer a guarantee. If your products are either more expensive than most, or can’t be touched by the consumer prior to purchasing (such as with internet sales) you MUST have an iron-clad guarantee to assuage their fears. This must demonstrate that you’re the best and the customer has nothing to risk.

Since we’re looking for quick fixes, I’m going to stop the list there. If you do those things, you’ll notice results almost instantly.

On the sales side, you need to again, learn your numbers. Am I getting that point across fully yet? 🙂 Whether you realize it or not, in your sales cycle, there are many steps. Let’s take a retail clothing store for example. What are the steps a shopper takes?

  1. Window browsing – How do we get them to actually walk into the store? A lot of retailers put up blinds behind the window manequins so people have to actually walk in to see what else is available.
  2. Entering the store – How do we get them to spend time looking around? Depending on your clientelle, music can make a huge difference as to whether they hang around a while or not.
  3. Perusing certain racks or aisles – How do we get them to see the most we have to offer? Most retail stores put the clearance and discounted rack at the back so you have to walk all the way through to find the great deals.
  4. Trying clothes on – How do we get them to go to the dressing room? Keep in mind, people can only try on or buy as much as they can physically carry. Make it easy for customers to carry more with helpful sales associates and people will buy more. Paco Underhill addresses this in magnificent detail in Why We Buy: The Science of Shopping.
  5. Buying – How do we get them to come back? Are we getting their name and email address for our database?

So why do we break that up into so many steps? Because if you don’t, you have no idea which steps you need to improve. I’ve heard of a retail store that learned that around 80% of people who try something on will buy it. So they didn’t work on directing people to the cash register, they worked on getting potential customers to the changing rooms.

Every business has a series of steps in their sales cycle. You need to learn and track each of those steps for your business and then systematically improve the conversion rate for each one.

That was  a retail environment, so let’s consider a service based business. What possible steps do we have for them?

  1. Inquiry – via phone, web, or walk-in
  2. Service Pitch/Presentation – Are you skipping this step? If people call your plumbing business and ask what it costs to unclog a toilet, do you just tell them or do you first tell them why you are their best option with your guaranteed time, flat-rate billing, and professional staff?
  3. Price Quote/Estimate – Are you building value along with this quote (particularly if it’s in writing) to back up your pricing?
  4. Commitment to Purchase – If the commitment isn’t made immediately are you leaving them PLENTY of information to convince them you’re their best option? My business has a 24 page “leave-behind” packet for just such instances.
  5. Delivery of Service – Are you delivering exactly what you said? Particularly if you only get paid once your service is complete.
  6. Payment – Do you have simple payment options and are you asking for payment immediately upon completion so as not to tie up your office staff trying to collect money?
  7. Follow-up – Did you get their name, phone, address, and email for your database? Did you call or visit them again after completion to make sure they were completely satisfied? Did you ask for testimonials or referrals?

As you can see, there are a lot of steps in this process as well and at any step along the way you can lose potential clients. That’s obviously why tracking the number of customers who make it to each step is so important!

A couple of things you can do to help improve each step in the process:

  1. Have excellent training for each person involved in sales including detailed scripts, role-playing, and NLP training.
  2. Incentivize and develop some competition. People like to know someone else notices that they are the best at what they’re doing.
  3. Have an outside company shop your business and report back what they find.
  4. Record phone calls, conversations, and customer interactions (after checking with your lawyer of course) to look for opportunities for improvement.
  5. Provide on-hold and/or in-store marketing over the speaker system. I know the “blue-light” specials weren’t enough to save Kmart, but I’m not claiming that’s all you need to do for your business either. 😉
  6. Create your story portraying your commitment to customer service, quality, community involvement, and excellence. Make it available in your store, restaurant, business, and on your website. People love buying from places where they feel a part of something.
  7. Include testimonials everywhere! Put them in your store, on your website, in your marketing, on your thank you cards… heck, you can even put them on your receipts.

In my experience with over 100 small businesses, I don’t know of anyone, myself included, who is doing all of these things well. In my defense, I do know what I have to do and one-by-one I’m crossing them off of my list.

We’re on Part 4 right now so you should have quite a long To-Do list written down, right? If not, go get a piece of paper and a pen, review my last 4 blogs and start writing. After I post my last blog on this topice (Part 5) you’ll now have a complete list that you can prioritize and start addressing.

To your sales and marketing success, Bryan

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

Intrapreneur and Entrepreneur – The common ground

In my last blog, we reviewed the 2 most basic types of people in any organization. Of course there are more specific and scientific personality tests and reviews along with detailed methods of how to best communicate with the 27 personality types, however who is ever going to remember 27 personality types let alone how they best interact with your own type? Moreover how are you going to remember exactly which person fits which type?

In contrast to that, my idea is simple, quick, and easy and though it won’t get you a perfect result every time, it’s certainly better than lumping everyone (including yourself) into one category.

That being said, in Marcus Buckingham’s book First, Break All the Rules: What the World’s Greatest Managers Do Differently, he lays out the exact 12 things that every person requires to be effective at their job. I have probably recommended that book half a dozen times in my blog and if you’re a leader or manager for any business you need to read it. So let’s get a quick and simple review of what Buckingham’s exhaustive research points out. All team members require the following:

  1. Vision, Mission, Culture guidelines – What’s the big picture?
  2. Job Description – Obviously this will be very detailed for intrapreneurs and more flexible for entrepreneurs. Absolutely no one can
  3. Positive Reinforcement – Do not underestimate this power.
  4. The right tools to get the job done – Nothing can be more frustrating. Intrapreneurs will have more tactile tools while the tools of an entrepreneur may just be pointing them in the right direction.
  5. Someone at work they can trust – this is universal
  6. Progress reports – everyone wants to know how they’re doing and how they can do better. No one wants to suck at their job.

He has 12 items on his list. I cut it down to 6 overall so read the book to learn how to determine if your business is setup for maximum profit and productivity. The point of this exercise is to point out that no one can manage themselves. No matter how entrepreneurial someone is, if they have a boss, they need direction. Period.

Another commonality is goal-setting, though the way that goals are set can be different. According to a Yale study from 1953, the 3% of graduates who had written goals had amassed more wealth than the other 97% of classmates years after graduation. So regardless of your personality, written goals are extremely valuable.

Everyone should have written, measurable, time-sensitive goals. Those goals should include levels of education, income, savings, type of work, family matters, travel ambitions and everything in between. I’ve gone as far as to make a list of all of the motorcycles I’d like to own in my lifetime. Several are already checked off however the list seems to be growing faster than I can control at the moment. 🙂

Now most people have a general “big picture” idea of what they want. Things like, I want a family, I want a job that I love, I want my kids to respect me, I want to retire at 65 with $2 million dollars, I want to see Paris, etc. etc. etc.  Now if you have all of that written down and you reference it often that’s a BIG step in the right direction. However you can do better. Here’s a quick 3 step process to setting goals:

  1. You need to put everything into Do x Be = Have perspective.
  2. You need to assign time frames.
  3. You need to take into account your entrepreneurial or intrapreneurial tendencies.

The 3rd item is what we’ll address right now. As an extreme entrepreneur, my goals have time frames, but they are honestly relatively vague. For instance, in my lifetime I want to own at least 5 businesses, become a “young millionaire”, and write at least one book (though I have 4 in mind at the moment). As an entrepreneur, my immediate goal is to always find the best opportunity right now. That means in the next 12 months, I may write the book, buy another business, or get more schooling to help me learn more of the things that millionaires might know that I don’t. My point is, that my personality thrives on making the most of the moment. So instead of saying “I want to write a book by 2011”, I work on all of my goals at once and then go after the opportunity that’s best today, this month, or this year. In 2010 that may be writing that first book, or it may be visiting all the countries on my goal list, or it may be the next business. I’ll be working on all 3 and choose the path that is best at the time.

So how is that different than an intrapreneur? Intrapreneurs are more of the details individuals. They need specifics and they need specific time frames and they need a specific way to get there. Whereas I just need a “big picture”, an intrapreneur needs smaller goals to help achieve the larger ones. So if we take the same example of becoming a “young millionaire”, the successful intrapreneur will have a more specific goal list to achieve those goals.

For instance, their sub-goals to achieve the goal of becoming a millionaire might look more like this:

  1. Buy a business with vendor financing in the next 12 months that has the potential to double in profits within a year with only the $5,000 I can drum up from selling my stuff and from savings. I must pay no more than annual cashflow plus assets for the business. It must have the possibility of paying me enough to live on while I’m growing it.
  2. Build the business for less than 12 months and relist it on the market. It must have the potential to make me $100,000 profit when sold.
  3. Reinvest the $100,000 in another business under the same criteria but with the ability to potentially sell for $300,000 profit within a year.
  4. Of the $300,000, put $50,000 into down payments on cash producing real estate, $50,000 into the stock market and the other $200,000 into another business with the potential to be sold for $500,000 profit within 1 year.
  5. Reinvest as much as necessary into a business that can either produce sufficient cashflow to make me a millionaire within 2 years of can be sold for $1 million in profit. The rest will be split between additional real estate and securities.

Why does the intrapreneur need so many sub-goals? Because something vague like “become a millionaire” seems so daunting an unattainable however when you break it down into small steps with specific time frames and details it becomes a whole lot easier for them to accept. Entrepreneurs can often feel much more comfortable and in-their-element with goals that are more vague. The exact details can at times make us feel trapped. That being the case is a detailed list bad for an entrepreneur? Of course not. As long as he can appreciate that it’s a guideline and the numbers and time frames will never be exact.

So my last question is, how does this help leaders better lead their teams?

As leaders, it’s our responsibility to provide progress reports, to develop job descriptions, and to help develop goals for team members within your organization. By now, I hope that it makes sense that those job descriptions, review sessions, and goal-setting meetings might be quite different for the 2 basic personality types.

To you success in providing the foundations of the common ground, Bryan

P.S. If you’re curious why my steps to becoming a young millionaire are primarily contingent upon buying, building, and selling businesses check out my blog on the topic.

Intrapreneur vs Entrepreneur… The 2 types of people every business has…

Every business is comprised of 2 basic types of people.

Entrepreneurs and Intrapreneurs… Those who want risk, reward, challenges, and the excitement that comes with that and those who want stability, direction, consistency and the security that may come with that. Of course there are also those who just want a free ride and try to skirt responsibility, cut every corner, and get away with the highest pay for the least amount of effort, responsibility, or risk – but we’re going to skip over that lesser type and focus on the positive parts of an organization.

Before we delve into these 2 types, keep in mind this is an exercise in simplicity. It’s helped me determine and target which individuals I need to hire for which positions and it’s also helped me tailor, structure, and respond to those already on my team. Probably more importantly, it’s given me a greater understanding of my own requirements, desires, and motivations so that I can keep myself passionate and effective.

So which are you and how do you identify those around you?

Intrapreneur – These are the 9-5ers. The team members who don’t want to come earlier than starting time or stay late (though sometimes they may). They want to know exactly what they’re going to do that day, and know that next week, next month, and next year their paycheck will be there. For these types of individuals it’s very important that your leadership is consistent, fair, and direct. They want detailed, specific training. They want all the right tools and they want to know how to address any situation. These individuals are risk-averse and generally prefer repetition in their tasks so they know they’re doing what they do best constantly.

Entreprenuer – According to dictionary.com, entrepreneur is “a person who organizes and manages any enterprise, esp. a business, usually with considerable initiative and risk.” Within your team, whether they are leaders or not isn’t significant. They’ll naturally gravitate to the leadership positions and get people to follow their lead whether they’re given the title or not. They want excitement and a challenge. They are proud of their creative talents and want a forum to showcase them. Responsibility and appropriate reward for their risk-taking is very important. They hate being stagnant. If you aren’t helping them get better, faster, and smarter constantly, they won’t stay. Appropriately these are the traits of entreprenuers who venture into their own businesses, however with an environment that provides them the benefits of self-employment these individuals can thrive within an organization owned by someone else.

So why understand these classifications? As I mentioned above there are 2 main reasons:

  1. To identify for yourself which one you are so you can understand your own strengths and weaknesses.
  2. To identify which your other team members are so you can structure your communications with them to meet them on their level.

Let’s look at #2 first. What would be the difference between an Intrapreneur and Entrepreneur as far as appropriate compensation? The following video discusses some science that helps us better understand how to answer that:

The ROWE work environment is GREAT for entrepreneurial individuals. The studies he mentioned demonstrated that with those type of individuals working in complex, changing, challenging environments where “thought” is the primary value of the team members, compensating based on performance is counter-productive. However, intrapreneurs, who value consistency, will respond much better to simple tasks with compensation tied directly to their performance. Which is why in my organization, I work hard to incentivize those simple tasks.

So let’s jump back to #1 so we can better understand how introspection and clarification can help us perform at our peak. This is broken down into 2 sub-categories:

  1. Our interactions with other team members.
  2. Our goals for ourselves.

Let’s take a scenario and see how it might differ based on the circumstances. Let’s say you’re the leader and you’re implementing a new, exciting product in your business. Since your team members are in front of customers all day every day you have to get buy-in from all of them so how do you present it to an intrapreneur and an entrepreneur?

The intrapreneur will require a LOT of hand-holding. They want instructions, scripts of what to say, Frequently Asked Questions with the appropriate responses and all the benefits listed out so they can reference and recite them.

Entrepreneurs, on the other hand, need excitement. If they believe in the product and are excited about how it can help them and the customers whom they interact with, they’ll figure out the rest. They’ll learn how to answer the tough questions and the best way to present it in a way that’s comfortable and yet effective.

How do I know this is true? As one example, in my business we just started Platinum Care Plans which are simply extended warranties including all necessary maintenance. My entreprenurial individuals ran with it. My intrapreneurial individuals, at best, have started mentioning it to customers but have not sold one Platinum Care plan. Why? Because I didn’t present the information that they needed in the way that they appreciated so that they were comfortable enough to sell it.

Now here’s the real kicker, considering that I’m the entrepreneurial type (squared), is it any wonder that I presented the information in a way that was more digestible for the entrepreneurial team members??? Of course not. Which is exactly why we must understand how we fit into this scope. Next time I’ll do a better job of helping my intrapreneurs right from the start of a new product.

More importantly, understanding our own basic tendencies can help us more fully understand how to structure our business and personal goals. For instance, if you’re exceedingly entrepreneurial, at some point you’re going to want to go out on your own. You’re going to want your own business or be in charge of your own team with minimal oversight and you’re going to structure your education, contacts, and career choices to get you closer to that goal. If you’re exceedingly intrapreneurial, you’re going to generally look for a skilled trade and a reliable, predictable business where you can work. Now that skilled trade can be computer programming, accounting, or plumbing. It doesn’t matter much, you just want stability and the comfort that comes along with that.

Since this post is getting long, I’ll continue my next blog with more clarifications on what BOTH intrapreneurs and entrepreneurs have in common and require from their leaders.

To your success, Bryan

Shopping yourself – The best way to improve your business' conversion rate?

By shopping yourself, I simply mean determine exactly what your customers experience, record it, and review it to determine areas for improvement.

Paco Underhill actually wrote a great book titled, Why We Buy: The Science of Shopping, that talks about much of what he has learned through his Mystery Shopper business. His book and experiences are all geared toward improving retail closing ratios or conversion rates. In other words, he wants to figure out how to get the highest percentage of people to buy the most often. He doesn’t help with marketing or lead-generating in the sense that he helps get people into the stores, his business simply specializes in converting those people who have made a trek to your store into customers (or repeat customers).

Why do you NEED to invest so much time and money into your conversion rate? Because leads are expensive! In my business, leads cost around $78. In other words, to get someone to call me and be interested enough in our products to provide their name and contact information costs me $78 per call ($159 per call for Yellow Page contacts).  To convert those to sales costs me around $268. So right now I’m converting 1 out of every 3.5 prospects who call me into customers. As you’ll learn, these numbers are never perfect and this doesn’t include people who call me for service of existing equipment or to purchase ancillary products. This is simply the people who don’t have anything I offer right now and want it.

Now what do I stand to gain from increasing our conversion rate? Potentially thousands of dollars in revenue and profit. Since some of my new customers are rentals (or equipment leases) and some are sales it’s hard to get an exact “average dollar sale” of my new customers however here’s how it breaks down for new customers in 2009:

  1. Average new sale – $3798
  2. Average new monthly rental/lease – $52.78

Roughly 24% of new customers are rental/leases but let’s ignore that for a minute to keep the math simple. If I can increase my conversion rate for sales by 10% so that 1 customer buys for every 3.15 people who call (instead of every 3.5) that would have added about $32,283 to my business this year. In addition, though my cost per lead would remain the same at $78, my cost per sale would drop to $249 ($241 if I assume a 10% increase for both sales and rental/leases). To say that an even simpler way, increaseing my conversion rate by 10% results in a direct increase in gross profit of 10% on all of my sales. Not bad. And don’t forget we just increased our top line revenue at the same time so my actual Net Profits just increase by much more than 10%.

In the past I’ve reviewed how to increase your conversion rate. Since I’m always looking for new ways to do that, I’ve bumped into Paco Underhill’s book and into a company called teleXpertise. teleXpertise does the same thing that Mr. Underhill’s company does except they do it over the phone. They’re phone mystery shoppers and I must say they’re very good. Their recorded calls with your sales people will tell you a whole lot about the efficiency of your sales process. My business model requires onsite inspections before quoting prices so our process can be quite lengthy from the first call to a closed deal. Keep in mind that every interaction with the customer is a potential step where they can be lost forever however each step does not result in a sale… So each and every step has to be improved. To clarify what I mean by “steps” you’ll want to check out my blog on increasing your conversion rate.

Let’s talk a bit more about how they can help you increase your conversion rate by evaluating what I’ve learned. Keep in mind that I have my sales phone calls scripted and have gone over individual training with all of my team members on how to handle sales inquiries and the following still came up:

  1. Answering questions that we didn’t know the answer to. (though we thought we did)
  2. Not asking for the caller’s name or contact information (including email).
  3. Answering questions that we shouldn’t (because they’re based on what information we gather from an onsite inspection)
  4. Quoting exact prices over the phone
  5. Not using proper NLP techniques
  6. Didn’t always ask about what prompted them to call us

And what we did right:

  1. Cross-sold products (i.e. they called asking about X and we told them about Y)
  2. Tried to set the appointment with the customer (several times)
  3. Returned the customer’s inquiry within minutes (our lead catchers don’t set appointments our sales people call the customer back to set the appointment)
  4. Upsold products (i.e. they called about a service we didn’t offer and we suggested a better alternative)
  5. Differentiated ourselves from our competitors

So you can look at this information in 2 ways.

  1. After all that training we still did more things incorrectly than correctly so we suck (me in particular as the Team Leader).
  2. After all that training we still did more things incorrectly than correctly so just look at how much more money we could make if we always did things correctly!

Obviously I focus on the latter. It’s one thing to do the right thing by training and scripting, but it’s just as important to constantly train and improve. What was most surprising to me was I didn’t tell a single person on our team that we were using mystery shoppers until after they were done.  When I did tell them their conversations were being recorded they weren’t at all mad about it, they were actually excited to hear themselves. This may be partially because I set the bar for myself to constantly improve so I’m not asking them to do anything they haven’t seen me do over and over again and I stressed that before I told them what was going on. I also let them know how much we pay for leads so they can get a grasp of just how valuable each and every call is. The best part, however, was that they were very receptive to improvements and looked forward to doing better next time. That’s right, I assured them their would be a next time… 😉

To your increased conversion rate success, Bryan

P.S. As an additional note, if you’re buying a business you should definitely Mystery Shop the business ahead of time. If they did more right than wrong you may want to look for a different business. If they have a LOT of room to improve that might be the perfect business for you. Keep in mind that you prefer to buy businesses that just need to tweak the front end.

How to fire someone… The right way…

As I mentioned in my last blog (yes, I know it’s been a long time but with restructuring our team I’ve been busy), after reviewing how I doubled profits in a year, I was going to review all that I did wrong. Actually, that would require a book not a blog so let’s start with the biggest problem.

My biggest mistake in my first year of business ownership was my avoidance with letting people go.  There were 2 reasons for that:

  1. The worst thing you have to do as a business owner is to let someone go. It’s not fun and if you have any heart it’s actually very emotional. Beyond that, while you’re training his or her replacement guess who gets to pick up the slack? That’s right, the owner or leader in charge of that position.
  2. I prefer to believe people are better than they actually are. I tend to believe I can educate, train, and help someone learn “anything”. After all, if it’s easy for me then how hard could it possibly be to teach someone else?  Unfortunately that’s just not how the real world works. People with the greatest intentions just may not have the talent or intellectual capacity to do what’s needed. For a great reference on that topic, read First, Break All the Rules: What the World’s Greatest Managers Do Differently by Marcus Buckingham

Ironically, in the six stages of business that Brad Sugars teaches, building your team is the fourth step. In the next year, as I build my team so to replace me, I’ll let you know how that works. At this point it seems it would have been a lot easier to get the right people in the right places first… We’ll just have to see.

So I’m much more cognizant of my weakness at letting people go who need to be let go and in the process have learned the “proper” method to do so.

If you fire someone correctly, a few things will occur:

  1. You’ll maintain a positive relationship. In my experience several people asked for their jobs back a few months after I let them go so obviously they didn’t completely hate me. 🙂
  2. He won’t file for unemployment. It affects your unemployment insurance rates for years to come so it’s worth fighting and preventing.

Firing someone is actually MUCH easier if you plan and prepare properly. Here’s what I suggest:

  1. Make up your mind! If you’re not 100% sure that it’s the proper thing to do, then you probably shouldn’t do it. You don’t want to get in an emotional situation where they talk you out of it. Make up your mind and stick to it.
  2. Gather performance information. Particularly related to poor performance. The reason for this is because if you “fire” someone with reason, they aren’t eligible for unemployment in many states (I’m not a lawyer so consult one if you’re unsure). Otherwise it may be considered laying them off in which case they can claim unemployment. The second reason for this is that when you sit down with them, if they feel indignant and question everything, you have all of your notes and information in front of you to stick to your guns.
  3. Don’t use the negative performance information more than you need to. In other words, you’re already ruining their day, no need to rub it in. Most people know they’re underperforming. At least 3 people I let go didn’t offer any resistance whatsoever and because it was obvious by their performance that they knew it was coming.
  4. Don’t ever use the words “fire” or “quit”. Those are harsh words. Instead use the terms “let you go” or “resign.” Review my blog on NLP if you don’t feel proper word choice is important.
  5. Offer them a choice. If they just aren’t capable of doing the job you need them to, but they otherwise work hard, show up on time, etc. and you feel comfortable doing so, offer to let them choose to resign or you’ll have to let them go. Emphasize that it’s tough to get a job if they can’t use you as a reference. Moreover you can’t lie, so if someone calls to ask why they no longer work for you, you’ll be obligated to tell them they were let go and why. All 4 people I offered this option to decided to resign. Consult a lawyer on this point as this may not be accepted as a legal resignation.
  6. Get any business items immediately. Whether its keys, tools, company credit cards, cell phones etc. Get them all immediately. It may be against the law in your state to hold someone’s paycheck, but if your handbook says so, you can charge them back for any equipment they don’t turn in before their paycheck is ready.
  7. Offer to let them put in their 2 weeks notice. If you don’t have a gross negligence issue and you can completely trust that the individual won’t sabotage you and your business for their final 2 weeks, offer to let them work their last 2 weeks while they search for a new job. Make it clear that you don’t want to regret that decision and that you’d be willing to be flexible on their schedule if they have interviews. As an Ethical Business Builder, in instances where the person just can’t keep up with their work I prefer making this option available. In my business I only made it available to my office personnel and never to service personnel who have my trucks fully stocked with tools and parts to slowly sell off or steal with little oversight in their last 2 weeks.

That’s it. So far I’ve had to let 4 people go and haven’t had a single one apply for unemployment. Two have asked for their jobs back and I hired a another’s father to work with me with no hard feelings (and he’s a GREAT addition to our team).

Properly preparing for this horrible part of being a business owner actually does make it easier and a lot more palatable. It’s eventually going to happen, so don’t put off letting someone go when you know it’ll will be better for your business, customers, other team members, and ultimately the individual.

To your team re-building success, Bryan