small business issues

What does it take to start a home-based business?

As a member of a large organization that helps small businesspeople, I often get the opportunity to communicate with new business people about the businesses they want to grow. In most cases, this is via email, but occasionally, I have the opportunity to meet with one of these clients in person. And, yesterday at Panera was one of those times.

Jill (not her real name) had a couple of product she wants to market on her e-commerce site. We did not spend much time discuss the merits of any of these products. (She had determined my role to be the “web” advisor.) She already had her business set up as an LLC. She had spoken to her accountant, and she was focused on getting her product out on the internet and selling. She told me she had discussed getting a logo and website designed for over $2,000. And, she assured me she was willing to spend less. Her accountant had recommended a program like Quickbooks. And, beyond that, I tried to recommend within those limitations. The bullets below are the point we left the meeting as actionable items:

PayPal: Frankly, I was surprised Jill had not set up an account already. Short term, PayPal was going to be her credit card processing. She could sign up for the “virtual machine” and other features that would allow PayPal to process all credit card transactions. And, if she ever needed to refund a payment, this was easily done with PayPal. And, since her product mix was limited, she could create the buttons within PayPal that would allow PayPal transactions to easily process.
Google (base & Adwords & blogs): Quite a few things for Jill to keep in mind here….
- Adwords: This is not for everybody. BUT, if you know the right techniques, you can make sure the money spent to get traffic has a higher percentage of results. (Don’t let your ads show up on “Adsense” sites.)
- GoogleBase: Based on your products title, you can skip to the top of Google search results!
- Webmaster Tools: Depending where her website was hosted, this could be very helpful. When you know how your site is being found, you can try to bridge the gap and do what is necessary so you can be found using other keywords.
- Blogger: Although there is some writing required, it is a good way to let information trickle out about your product expertise.
GoDaddy (or any other registrar): Jill already knew what domain she wanted, but after discussing other website options, she wasn’t sure she needed to register her domain name. I don’t know if she was sold on the idea. But, when you are a small company and want to look big, having multiple email addresses at your domain (i.e. sales@yourdomain.com, info@yourdomain.com, etc.) is a quick way to achieve this.
Ebay: (newsletters, etc.) After our meeting, Jill believed this was the least expensive way for her to get her website. For less than $20/month, she could load up her store and begin selling. Ebay has many features a regular e-commerce site would have, but it is just not your domain name. I really believed this to be a good quick solution for Jill as she seeks the right product mix.

Well, after our meeting, I emailed Jill the information I had on my logo designer. She replied back that ebay did not seem to be the right venue for her products. So, she wants the name of the designer I have used for some of my websites. I don’t believe I would have success with Jill’s products, but me and the other SCORE volunteers are willing to help her as much as we can. Maybe I can spend some more time on the right “products” in the future….

Will this teach them entrepreneurialism?

Despite my existing website and other projects, I like to look over ebay and see what kind of businesses are available. And, if any of them are in the right price range and meet my other requirements, I may open up a email discussion. And, depending how that goes, we might talk on the phone. And, occasionally I may end up purchasing one. Well, recently this happened. And, what follows is my logic for this investment….my sons need to learn business skills, and I think I have the vehicle.

My father was a very well meaning man. He worked very hard. However, he had no desire to work for himself. He had the energy and the smarts, but he did not have the tools or the belief he could succeed. I don’t want my sons to feel they are unskilled an incapable of owning their own business. So, since they are often short on motivation, I want them to have a short term incentive (money) and a longer term investment-ownership.

Since I am early in the process, I am sure my preliminary logic is missing factors that will influence the eventual success or failure of my plan. But, until then, this is why I think my recent purchase of an ebay business will be beneficial for my sons:

Teaches quality: As my sons worked the first night after the “equipment” arrived, they were not familiar with the equipment being used. And, unfortunately, this resulted in a cutting the product incorrectly. They asked, “Dad, it is close to the right size. Won’t it be alright?” And, after I said “no”, I went on the explain how important it is to give your customers the best you can give them. In the days of “cheap” products, I hope other dads are trying to teach there sons the same lessons.
Teaches discipline: After school activities and a very busy day, there were orders that needed fulfilled. And, rather than saying, “tomorrow will be okay”, they stayed up well past their normal bedtime to get it done. Our/their customers chose to buy their product. The customers had other choices, but yet gave them their money. If you can’t take care of your customers, then your priorities are wrong. And, if at the end of the process, they don’t want to be responsible for taking care of customers, then they would have come to that conclusion based on experience.
Teaches marketing: Why do people buy from you? Is it your ebay feedback? Is it your price? Is it being at the right place at the right time? It could be a combination of all of those things. As we learn this product together, we can discuss those issues. And, it will not offend me at ALL if they out think me. If fact, it will let me know the experiment is on track. (And, that the teacher isn’t completely crazy!)
Teaches Profit: What happens if we lower our price? Can we switch suppliers or talk to our present supplier and reduce our product cost? Can we reduce our shipping cost? Their labor may be cheap, but that doesn’t mean they can’t think about the bottom line and understand how they can contribute.

If this experiment is of interests to you, please let me know! Give me your experiences or your ideas to challenge them. Regardless, I am hopeful additional posts will follow….

Once bitten, twice paranoid

As a small business owner, I have my small staff AND a few consultants I use for a variety of efforts. Recently, I hired a consultant to help me with one of my website efforts. After we met via web conference, I decided to go forward. The price was agreed upon, and the exchange of requirements began. After the requirements were agreed upon, the work was scheduled to begin.

And, it is here where things got a little crazy….

I emailed my contact a couple of times and I did not get a response. So, after thinking she was busy, I thought I would just call her up. And, after listening to, “This phone number is not in service,” a few times, my paranoia started climbing.

I did a search on the company name. I found some negative information on them posted within the past week. And, I was then “certain” I had been taken–I had already paid a percent of the project costs.
I found the website of the local Better Business Bureau. I punched in a phone number of the company, and I was able to determine they had a satisfactory rating. And, I thought, at least this is one positive thing to “sorta” alleviate my paranoia.
I did a search on the name of the owner. I found 2 phone numbers that were possible candidates to be my “man”. I called the first one and talked to the owner’s mother. She asked me to call her back, and she would provide his cell phone number. I did, and SURPRISINGLY, she answered and provided the number.
I called the number, and he picked up! He told me their phone system was being upgraded, and they were still in BUSINESS!!!
He got back to his office, and called me again. He had my project coordinator email me right away. And, he emailed me a couple times, too.
And, I called the company’s phone number, and it now worked!
AND, the next day, the owner emailed me a longer explanation of the negative comment I had found on the internet. And, he invited me to call/email him with any other questions I may have had.

Conclusion: No matter how many times you have been burnt, there are good people out there to work with. When you are burnt, you can’t just close the doors. With internet consultants being such an important part of a small entrepreneurs cost savings, you need to get wiser each time you take on a consultant. I haven’t learned all of the lessons yet, but I continue to realize the limitation of SignsSeen. And, consultants are the only way that I can effectively make improvements to the site without distracting the rest of us from what we need to do…sell signs!!

Consultants aren’t perfect

I use a consultant who is a pretty good guy. He works inexpensively, and I try and give him good projects. And, he also manages my entire server. So, I try to give him enough business that it is worth his while. BUT, he isn’t perfect.

He “released” my SSL certificate and told me it worked. Well, it didn’t! And, after more patience than I would have liked, it now works.
When one thing works, another doesn’t. These aren’t big things, but they do seem to keep me wondering how much testing he does before releasing. But, did I mention he was inexpensive and that my time is “cheap”?
IT guys are often not the best communicators. He does okay, but he doesn’t always think, “What would my customer think if I don’t respond to him in 3 days?”
He is a shared resource. I am probably his biggest customer, but I am not the only one, so I either need to find a new less busy guy who will probably cost more OR I need to adjust my expectations.
A couple of times I have been sold a module for my shopping cart that will do “everything” I need. But, when it is installed, we find out that a couple things that were supposed to be in this release just “didn’t” make it. So, I get the newest and greatest, but my consultant was just overselling what was oversold to him.

Well, if he is imperfect, why keep him?

He is honest.
When I get him on MY tasks, he is pretty good.
When he quotes a price, he sticks to it even if he missed something when he was scoping it.
He knows my shopping cart inside and out. He can tweak it, write modules, and fix other peoples broken modules.
And, he doesn’t think I am to big of a nag when something is broken….

Good Luck finding the consultant to help grow your business!!

But I have lots of products on my site!!!

After having a goal of placing as many products on my site as possible, I have reached a point where the fallacy of this logic is apparent. And, this is why:

Some of the products on my site became more complicated to order when “many” was the goal. Due to my shopping cart software, I created a separate product for EVERY letter of the alphabet. If I would have had one product for all and had a pull down list for the letters of the alphabet, customers could more easily taken care advantage of tiered discounts. (I have now set my signs site up this way for the LEDGO, LetterLED, and Neo-Link.)
Some products just don’t have much margin. As I begun the site, I thought, “I will put EVERY possible product I can on the site.” Once supplier costs and the cost of stocking non-moving products are figured in (let alone possible returns), it is just not worth the small profit you will make on a product.
Many of the products I have removed from the site were large items that needed some level of expertise to install. As an example, there was a very problematic outdoor LED sign I sold last year. I was very honest about SignsSeen not doing the install. The customer realized this, and did their own install. But, prior to installing, my customer did not test any of the wireless functionality. So, what should have been a very easy process, turned into a couple of weeks keeping a customer happy until the wireless communication issue could be resolved. FUTURE PLAN: I have contacted a new outdoor LED company that works to find the installation company. If this takes place, I will have their products included in teh near future.

What if someone still wants the items I have deleted off of the site? I will either tell them where to go to buy them direct OR I will quote them the product. My goal will always be taking care of the customer. And, if the customer can get a better value buying direct from the supplier, I will let them know. And, if I can’t provide a good value, then I need to find another line of work…

I am just here to help….

I had a customer from Canada yesterday. And, they wanted to buy a sign. After I go through the “shipping will cost more and do you have a broker?” caveats, I sometimes will refer the customer to a similar company in Canada to get a similar sign.

Why would I do this?

The shipping really does cost more. The value of the dollar to the Canadian dollar makes shipping even higher.
If I was making 50% commission, I might pursue these sales a little more aggressively. But, I don’t. Once the potential problems with the purchase are factored in, my margin goes down even more.
The communication with the manufacturer is much greater on orders to Canada. Lets say I am shipping a roadside portable sign to Canada. I always will need to get a shipping costs, but I also need to have broker info. And, besides having to send a copy of the customers sales receipt to the manufacturer, I also need to know exactly where the trucking company will be crossing the border into Canada, and the customer’s broker has to have a presence there.
Customers will occasionally call you and be upset that the GST makes the price of the sign even more. And, I can’t help this.

Don’t get me wrong, I do sell to Canada. And, I enjoy my conversations with some of my Canadian friends. In fact, more than once I have shipped to a US address (i.e New York or Minnesota) and my Canadian customers have driven south of the border and picked it up from this shipping address.

So, if you are in Canada or the United States, just give me a call at SignsSeen…I am here to help.

Watch what you ask for…..

I have been a little bored professionally lately. And, I have told me wife that I was looking for some type of change. (Our marriage is fine, so she did not take change the wrong way.) This only became my hope within the past week, and today I had my hope answered in full or part….

One of my businesses is (was) supplying floor cleaning products for a large national retailer of women’s lingerie products. I bring the product in, and then I ship it to a centralized warehouse where the floor cleaning products are sent out to individual stores. I had a passing thought about this business earlier this week, and the inkling exploded today. This floor cleaning product has been determined to leave a residue on their floor tiles. And, they are stopping all further ordering of the product. Additionally, they would like me to purchase back their remaining inventory of product. (in excess of $10,000)

The facts:

I just ordered and received a sizeable order of these floor cleaning products. This retailer is my only customer for these products. Do I try and return? Sell at a discount on eBay?
Without this product, the need for my warehouse is barely needed. Do I discontinue all cleaning products and end my sublease of my warehouse space?
I have the janitorial supply business and my sign business. If I choose to stop the janitorial business entirely, I can focus more on the sign business……
The same company issued a PO and refused to pay for the product ordered before.
These products have been good, consistent business. But, with the elimination of these products, the effort necessary to keep this customer viable is of questionable worth.

As it stands, I will likely wait to discuss options until April. My business partner in this business is out of the country for a few days, and we can both be more level-headed about it then.

On the positive side, my health or my families health was not impacted. BUT, I will be careful what I ask/hope/pray for in the future…really careful!!

What makes a good supplier?

As I have previously discussed, there are dropshippers and there are companies that you need to stock their products. As I have continued to grow and have many of both types of relationships, these are the factors that make for a successful long-term relationship:

Do they stand behind their product? I had a situation today where I shipped product to Alaska. The item shipped was a module neon system. Two of the modules did not blink as described. I called the supplier of this product, and they gladly agreed to ship the new product up to Alaska for me. If my supplier would have refused to do this, I would have had to order new inventory and ship afterwards. It would have been a couple of weeks before the customer received the product. This would also apply when a supplier issues the call tags and takes care of all product warranty issues where an product exchange is necessary.
Will they ship either 3rd party or use you UPS/FedEx account? Often suppliers will kick up the handling charge a bit when using their own account number. Since my website typically sells things with a set shipping price or a built in shipping price, it is critical I can minimize these extra cost.
How will they receive POs? One of my best suppliers likes to receive faxes. And, since I fax from my PC, this works out very well. Another of my good suppliers receives email POs. Although email is good, I like it when I fax and receive an email confirmation. (I recommend eFax.)
How do they provide tracking information? This is an area of EXTREME weakness. My two best suppliers usually have a tracking number in my email box within an hour OR within a day of shipment. (And, a couple of suppliers also send a hard-copy invoice.) In most cases, I am not provided tracking information. I get the tracking info after being prompted by the customer. OR, I get the invoice from the supplier with the tracking # included. This is an area of excessive busy work as we try to get the customer all of the information they require.
If dropshipping…how quickly do they drop ship? My two best suppliers typically ship same day if the order is received by 1:00. This is of great comfort to both me and my customers. My other suppliers typically are prompt, but since they don’t communicate immediately upon shipment, we are never 100% confident the item has shipped.
Do you have access to “head guy(or gal)” at the company? When I need custom quotes or when I want volume pricing, this is key. No matter how big of a company you are, you look much bigger when you can get the customer information VERY specific to their project.
Do they pro actively let you know about new products? Not many of my suppliers do this very well. Those who do, make me feel guilty if I don’t get new info or new products up on the website quickly.
Lastly, speaking of websites, does your supplier help you get their product on your site? Many will give you graphics and access to their website. BUT, if you find a supplier that will give you a spreadsheet with most of the information needed for your website, you are doing VERY well!

None of my suppliers do all of these perfectly. And, I am not always perfect as well. I am fortunate to have the suppliers I have. And, I will always accept new ones that provide many of the bullets listed above.

Website upgrade headaches

The website, www.signsseen.com, has had its share of headaches lately. The most recent was necessary (upgraded for more secure checkout), but not completely smooth.

Some of the problems encountered:

The error pages were not set up correctly. As part of the secure checkout process, the shopping cart URL was changed to www.shop.signsseen.com. And, many Google, Yahoo and other spidered links were not available. And, the subdomain needed its own set of error pages. So, for about a day, this was broken.
Check out problems. Not sure about this entirely, but I have received calls that the order could not be completed online. A few customers mentioned bookmark issues. And, there is the occasional issue with not providing the correct “bill to” address, so until I see a definite pattern, I will trust this is the case.
Some modules not generating the correct link. When using osCommerce, there are many modules that can be installed. And, it appears the modules may need to be changed when the a sub-domain is added. This should be fixed later tonigh by the consultant…
We are behind a software patch-This has caused the removal of the “breadcrumb” navigation across the top. This occurred due to a combination of things–the subdomain was only a part of the problem-I think…
And, the upgrade was delayed. Certain modules did not work with the subdomain. So, my consultant worked for awhile to make them work before the upgrade took place. I HATE delays…

Now, I hope the only fallout of the upgrade is waiting for Google to catchup. Once this is done, I anticipate more sales, MORE products and MORE upgrades.

Who are you sharing your server with?

At first there were just occasional periods where the site was slow. Then, they became more frequent. Eventually, customers called me and were having trouble getting to the site. And frequent sales of some of my top sellers had dropped off.

I started trying to look for patterns and track. Was there to much load on the server? Was it my chat software? Was the database to big? Nothing was giving me answers until my host told me about my server-buddy. Apparently, he just recently joined me on the server. And, although he was not getting much traffic, he was doing LOTS of database queries. And, when I (or a customer) was trying to access the database server at the same time as he was running his site queries, my loading times went up 3 or 4 times. (I consider anything short of instantaneous unacceptable.)

After excessive Instant Messages to my host, he got the hint. He gave me access to a couple of additional features on the server AND he found a new home for “server-buddy”. Now, the server is again smoking and ready for your orders once again.

Walking Down Life's Road With Andy