Hire, Train, Motivate the Best People - 9/101 Marketing Secrets

Industrialist Andrew Carnegie

Andrew Carnegie, probably the wealthiest man in the world at the turn of the 20th century was also famous for saying:

“Take away my people, but leave my factories, and soon grass will grow on the factory floors. Take away my factories, but leave my people, and soon we will have a new and better factory.”

Show me a thriving small business, and I will assure you that there are quality people doing quality work who are enthusiastically signed on to the dream of the owner.  On the other hand, if the employees are not high quality to begin with or don’t care, that is generally even more evident throughout the enterprise.

No matter how well you are doing on other aspects of managing your enterprise, one bad apple can keep you from reaching success.  On the other hand, one change in personnel can make all the difference in increasing every metric.

Review Your People, Positions, Needs

I have seen this time after time in my own businesses and in the businesses I have consulted.  Sometimes the negative influence is the owner.  Sometimes it is a relative of the owner.  Sometimes it is a favorite of the owner.  But even more commonly, it is the neglect of the management to care enough to hire the best.

I recently had client who had an outstanding salesperson in a retail environment.  This salesperson eventually decided to take another position where he believed he would make more money.  While the salesperson was at the shop, he was the top producer.  Over the next 6 months, the owner failed to replace the position, and admittedly had no one else in the business who cared about selling or who was any good at it.

The owner couldn't understand why his sales were dropping even though our efforts on his behalf were successfully generating high rankings and traffic from YouTubes, the website, blogging, and more.  I repeatedly told him that someone was going to have to sell.  He need to hire someone who could sell.  Eventually, he did, and to everyone's great surprise, sales shot up.  The person he hired was a serious professional with experience in the industry.  He had to pay more than he had to the earlier salesperson, but the results were very profitable.

If Hiring a Salesperson Is on Your Mind, You May Want to Read This Post:  Seven Salesman Traits You Should Look For in Hiring

He Would Be King

Years ago, I had a CFO who wanted to be president.  I even told him he could have my job if he showed me what he could do.  Unfortunately he decided to try and usurp my position before it was offered.  He undermined my authority (or tried to) on the shop floor and in customer service.  He told employees that he knew better than me, and that they should follow his direction, not mine, if in conflict.

Fortunately, my staff was very loyal, and the CFO had no idea how quickly reports were hitting my desk of his inappropriate actions.  He was out in a short time.  But I will admit to holding on to other employees who were sub par or bad apples in order to keep from doing the hard work of replacing them.

Hiring is only part of the equation.  After you make a good hiring decision, is there someone in charge of training the individual, not just in specific product knowledge and skill sets, but also in company culture, the mission, and priorities?

Instilling the Company Mission

When I owned my manufacturing business, we did the very best four-color printing in the industry.  Every employee was constantly reminded and appropriately praised for that industry-wide recognition of what they were doing.  It was our mission and priority to do amazing printing.  That needed to be trained in the skill and in the culture.

However, we couldn't allow speed to drop too much or we would not be profitable.  There was a balancing act that needed to take place between quality and production labor cost.  We trained our people to do the closest possible tolerance work and drilled into them the mission of quality.   After the training comes motivation. 

Motivating the Troops will be covered in an upcoming 10 part series.  If you want to be kept informed of what we are posting on in this blog, there are many ways to get the information:

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Are you only hiring the best, especially in this high unemployment time?  Or do you settle?  Are you training your hires? 

I'm writing this in March of 2013.  The recession is starting to lift.  Housing seems promising.  Retail is up a bit.  The stock market is at all time highs or close, even if that might be Fed Stimulus all the way.  Consumers are probably restless to spend again.  So you have a golden opportunity to hire people at very, very low wages who are "capable" of working at very high levels compared to their hourly cost.

The downside is that this group is way, way out of touch with anything related to a work ethic.  If they have been in college, they probably didn't work their way through, as most did 20 years ago.  They had scholarships or parent's money or unemployment insurance.  Those who used to work had 99 weeks to get back to work.  These folks need to be trained in their skills and in the work ethic you require.  Cut your losses early if they just don't seem to care, which many don't at this point.

In another year or two, it is likely that the economy will find its way back to something like normalcy, unless the leaders in Washington continue to find ways to kill it.  If we get back to 6% or lower unemployment, the remaining available workers are going to be like the ones you could find when we were at under 4%.  Not much good and demanding high wages.  Build now for that future time.

We are very happy to provide you with free direction and step-by-step methods for running almost every aspect of your small business.  Please let others know about us by Tweeting or Google+ or Liking us, etc.  If you do need help with your business, give me a call.  310-910-1848.  I answer the phone.

Business Strategies vs Goals. Why You Need Both!

Most Companies Don't Set Goals - Almost None Create Strategies 

Strategy Defined

What is a strategy?  How does it compare with or relate to a Goal?  Which comes first, a goal or a strategy?  Can you run a business without a strategy?  Without Goals?  Is this post about an academic issue that only applies to Apple and Boeing?

In my last post I laid out the basics of goal setting.  It is a pretty big deal to really sit down and figure out what matters to you personally, and what your major goals are for your business.  Some folks are afraid to do this.  Some just can't seem to find the time.  Some seem to feel that goal setting is not important.  I make the claim that goal setting is the most important thing you will ever do in the marketing success of your enterprise. 

In case you have set your goals, what next.  I know that for me, there is a tendency to immediately go into action.  But going off half-cocked will undermine much of the benefit of having set goals in the first place.  Do I mean by this, that if you set goals, but don't follow through with strategy and tactics, then don't bother to set the goals in the first place?  Not even close!  Goals are the most important, then strategy, then tactics. 

Back to the original question:  What is a strategy?  A strategy is the meat on the bones of the goals.  It is the how of the what.  Each goal should be taken individually from the top priority to the least.  How can the company most effectively use the resources available to it to accomplish the goals.  If the goal is to achieve an increase of 20% in sales, how will the company do that.  Possibilities could include a larger territory, new products, increased prices, more sales units or dollars per invoice, more dollars per client per year, more expensive products, more sales people, etc. 

An evaluation of the choices should result in realistic approaches.  If there isn't much money to spend, then it might be better to increase prices or work to increase the average ticket, neither of which requires any expense.  However, it is important to also measure the likelihood of success of each strategy as you determine which to follow.

At this point you might have a sheet of paper or a spreadsheet with a set of goals, and each of those goals has a list of strategies under it.  You might also include a dollar amount that can be invested in each. 

Hopefully you can see that this process is anything but academic.  If you think it is, tell me in the comments.

Read next:  What is a business tactic?  After the Goals and Strategies, You Need the Tactics

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Small Business Marketing - Marketing Secrets from a Serial Entrepreneur

Small Business Owner?  Who Are You? If You Don't Know, How Will Your Customer?  Marketing Secrets 11-20 Out of 101

The marketing of any company or product should start with the first ten elements that we have just completed in our 101 Marketing Secrets of a Serial Entrepreneur.  Figure out your personal and business goal, add strategy and tactics.  Once those are in place you can review your profit picture, including the cost and the revenue sides.  You will want to evaluate customer service levels, which will be directly related to your reputation, and largely dependent on the type of people you hire.  My last Secret in the top ten was quality.  Determining the quality you want to be known for is a perfect opening salvo into the next ten secrets. 

The quality issue is one of the 11 elements of your identification that we will tackle next.  Your company has an appearance, a personality, a feel, a place, a reach, etc.  Are you projecting what you intend to project?  Are you proactively determining the images you believe will make you successful, or merely allowing the market to decide who you are? 

Starting with the first of the identification issues in the next post?  Let me know in the comments what you think the 10 additional elements will be in addition to quality. 

Profit - What Is Profit? How Do I Do More of That?

Profit Is Far and Away the Most Important Marketing Secret - Ask Your Wife and Banker

A prospective client calls a while back: "I'm trying to decide whether or not to keep my business open.  My wife is getting tired of supporting my hobby."

When we discuss the subject of Marketing, most business owners and their employees, managers, and even customers probably think things like advertising, store layout, packaging, product design, or distribution channels.  Actually, only the very astute think distribution channels.  Nobody counts profit and it's negative twin, loss, as part of marketing.  But unless we make a profit, all of the good intentions, products, customer service, and promotion is eventually going to result in the doors being shuttered, and no one gets the benefit of all the good things you've done.

Have you seen your profit and loss statement lately?  Ever?  Do you know how to read it?  Do you understand how to analyze that P & L and optimize your business based on the information contained in that document?  Have you done regular inventories so that the P & L is accurate enough to provide you good data?  Do you take or give money off books so that you can't actually know the true results?

Recently I worked with a service business that was doing almost $500,000 in sales.  The owner was breaking even.  In two minutes I was able to tell her what needed to be done.  Two years later, after making nothing for her work, she decided to take my direction.  The company now yields $6000 a month in profit, and should move to about $9000.  Does your company have a gold mine just waiting to be taken to the bank?  Many, many companies do.

I recently wrote an article for Bicycle Dealer Magazine that laid out how a brick and mortar retailer should be able to take home $100,000 on sales of $800,000 (Email me if you'd like to see a copy of this article.  RandyKirk77@gmail.com).  Most retailers would be astounded by the assertion, and the truth is some retailers should do even better than that.

Profit is loosely defined as gross income less cost of goods and overhead.  Any analysis starts with the cost of goods.  What does it cost you to deliver the product or service to your client.  Is your cost of goods average or better for your industry?  Should you be buying better.  5% less cost on $500,000 in purchases is $25,000 a year.  Buying better might be worth some time and attention.

Selling price is another big issue.  Are you discounting too much?  Are you selling too many low margin items and not pushing higher margin items out with the sale.  Are your service employees paying their weight.  In most cases you should be paying service workers 1/3 of the gross income from their effort.

If the cost of goods is in line, attack the overhead.  Take it line by line and wonder aloud if you could eliminate that cost if it was necessary to save your business from bankruptcy.  A consultant once helped me cut $175,000 in overhead per year that was all essential in my mind.

Profit is the starting point for all marketing efforts.  What would you propose is #2 of the 101 marketing tips I will cover over the next 3 months?  Tell me your thoughts in the comments.

You might want to catch my new video series on Google Search Engine Optimization
http://youtu.be/vy3GRXmOvsY

 

Local Business Review Sites and Reputation Management

Small Business Owners Who Ignore Business Review Sites Risk Loss of Sales and Profits 

Any small business owner who learned the trade from a great mentor or who has read a dozen decent books on the how to run and manage a business knows the old rule:  If you make one customer unhappy they will tell 10 friends, but you need to make 10 customers happy to get one of them to tell one friend.  

And so it goes today with online reputation.  If anything the results are even more disproportionate.  I have clients with pretty decent customer service and lots of daily traffic with almost no reviews on Yelp, Google+, or any of the other online reviewing search engines.  Then again, I have clients with so-so customer service who attract negative reviews and can't understand why. 

If you are a small business owner, put yourself in the shoes of a potential client.  They search the internet and find a list of potential businesses that say they can fill the need of the moment.  As they quickly scan the list of options, the review scores are significantly different.  One company has 50 good to excellent reviews, another has 8 good reviews, and another has 5, but their score is 2 stars.  What would you do? 

It is a critical aspect of any business marketing strategy today to solicit reviews and testimonials.  You must find clients willing to take a few minutes to write up nice things about you on Google+ local so that the reviews show up on Google Places.  You also need to keep track of the comments being made on Google Places and Yelp.  If you see negative comments, you need to respond.  And that response needs to be courteous, engaging, and written with an eye to the idea that it isn't written to the unhappy customer, but to the others who have just read the negative review.

For more on reviews see http://googleplaceshelp.blogspot.com/2012/07/google-local-basics-410-reviews-will.html

What have you done about reviews?  What has worked for you to get more reviews? What are you doing about Reputation Management?