Archive for the ‘Business Management’ Category

« Older Entries

The Value of Selling Your Story When Negotiating Commercial Debt

Tuesday, July 27th, 2010

When you are negotiating your commercial debt burden, it helps if you can “sell your story.” What I mean is that the other person you are negotiating with will likely only know you as a voice on the other end of the phone line. If you can inject story elements into the process, you will get the other person on your side to some degree. If you ever watch reality-TV shows, you will notice that those contestants with a grandparent in the hospital with a terminal disease always seem to garner more votes. It is because the viewers are rooting for them. They have successfully introduced story elements into their struggle. This is similar to the effect I am talking about.

After you set the stage, it is preferable to proceed with the process entirely in writing. You have planted the story seed and now you want to control the presentation with written communications.

By submitting a proposal in writing that appears to be a standard settlement letter, this reflects a financially desperate debtor who may not be able to keep his doors open, yet wants to try to “do the right thing” towards the creditor by paying as much as possible (as a matter of character).

These entities are not as motivated to put a lot of time into this particular collection account. Obviously, if the collection attorney or agency cannot realize a large fee, they will take a small fee and dispose of the case. It is clearly an issue of time management relative to the fee they earn.

In order to “sell the story” your position must present the personal side of your dilemma. This may seem contradictory to the preconceived notion that collection attorneys and agencies have no feelings and do not care about your problems. They are only interested in collecting the highest possible amount owed since their fee is going to be larger and that is how they make their money.

However, we know the power of story, so it should be used whenever possible.

André Larabie

www.andrelarabie.com

Posted in Business Management, Debt Negotiation, Debt Reduction | 1 Comment »

The Commercial Debt Reduction Process – Negotiating by Mail Versus Fax

Tuesday, July 27th, 2010

For many years, businesses have negotiated contracts and proposals using the telephone or mail or some combination. This is fine if there is no sense of urgency to reach a quick decision.

And while telephone negotiations are typically memorialized in writing for all parties concerned, it takes time to write up agreements, contracts, etc. It also takes time to make copies available to all of the parties by using US Mail.

That is why courier delivery services such as Fed-Ex, DHL and others have proliferated. They are a viable alternative to US Mail. Delivering documents through a courier service can be timelier, and the delivery times are often guaranteed.

However, faxing your offers is a better method for negotiating with your creditors and it allows for presenting the needed documents to the parties in a timely fashion. You might still want to call your creditors as mentioned in a previous chapter, but you now have an alternative method of communicating.

I have found the facsimile (fax) machine to be a very successful method of initiating the negotiation process. Fax machines have changed the landscape and the time required to effectively communicate information between people and businesses.

Some readers may ask, “What about email?”

My answer to you is that email is also a good method, but you might not have the email address of the business owner, and unless you have a scanner, you may find it difficult to send a signed settlement letter to your creditor or their representative. The logistics of digitizing documents, uploading them to the computer, accessing them with the email program and attaching them to the communications add another level of complexity that you should try to avoid. The negotiation process is difficult enough without introducing these additional procedures.

André Larabie

www.andrelarabie.com

Posted in Business Management, Debt Negotiation, Debt Reduction | 3 Comments »

“Successful Business Turnaround – A Definition”

Tuesday, July 27th, 2010

What does “successful business turnaround” mean?

At first this might seem to be a simple questions, but like many things in business, it is more difficult than it first appears when you get further into the details.

It turns out there are many ways to measure and define a “successful turnaround.“

You might say that keeping your business alive for at least one year means that you have executed a successful turnaround.

You might say that keeping it alive for five years is the definition.

You might say that converting your business from a nonprofitable to a profitable company is the definition.

Or you might say that it is something else.

I am going to define what I call a successful turnaround. A successful turnaround has two elements:

1) Your business has a positive cash flow
2) Your business is transformed to sustain a positive cash flow

I think you could reasonably add a third element to the above definition:

3) Your business has a well-defined plan to restructure and further stabilize

I think this last item reflects that it is not enough just to fix a few problems with the business and nudge your company back into positive cash flow territory. The fixes you implement to accomplish this may be only temporary; as a result, your company may inadvertently fall back into turnaround range. Therefore, further steps are necessary.

If—in addition to correcting your immediate problems and sustaining a short-term positive cash flow—you restructure your company SUCH THAT THE REVENUE STREAMS ARE MORE STABLE AND PREDICTABLE, then you will be on the right track to stabilizing your business and avoiding the need for a future turnaround.

André Larabie

www.andrelarabie.com

Posted in Business Growth, Business Management, Business Turnaround | 2 Comments »

Key Features of a Good Turnaround Consultant – The People Factor

Monday, June 28th, 2010

When hiring a turnaround consultant, there are certain features you should require. First and foremost, this should be a person you feel comfortable with. You should like this person in a way that you can only assess personally. Some people are likeable and others not. I can’t explain exactly how to determine this, but if you feel comfortable with them, that is usually a very good indicator.

As a business leader and entrepreneur, I think you know what I mean. This feature may also have something to do with leadership qualities or charisma or trust, but it is probably the most important characteristic because the last thing you want to do is bring in someone that your employees don’t like and have this person irritate the situation worse than it needs to be.

Advanced degrees are nice, but they are hardly the most important credential. Someone who has an MBA or a CPA will certainly be a benefit, but if they have no experience, those degrees will not add up to much. The turnaround professional you select should therefore have a fair amount of experience with turnarounds (successful ones), and if possible with turnarounds in your business sector.

Ideally, this person should be a self-started and a leader. They should be able to deliver an honest opinion even if it is one you may not want to hear. C-level experience is necessary, and a good understanding of accounting issues would be a huge benefit. This person must also confirm to you that they believe they can turn your company around if you hire them. They should also have a solid grounding in negotiations, and if possible in debt negotiation. Debt negotiation and reduction will play a vital role in a successful turnaround.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Management, Business Turnaround | No Comments »

Your Customers Are The Most Important Asset You Have

Sunday, May 30th, 2010

So it all comes down to this: you must provide a quality product and service. Also, customer perception is key to your success or failure. Without your customers, you cannot be in business, no matter how good your product is, no matter how good your service is. It’s that simple. Customers are the most important component of your business.

And since your customers are the most important component, it is fair to treat them as a business asset. The interesting thing about this is that many business owners do not treat their customers as assets. They just let customers come and go, maybe giving more attention to the ones that spend more money.

When they do this, business owners are missing something big. Let me explain it with an example. I consulted for an Internet business that was in negotiations to sell their operation to a larger competitor.

How do you think the competitor was going to pay them for their business?

It turns out that the payment would be in the form of a per-customer payment. I think it was somewhere in the neighborhood of $300 per customer.

Why did they structure it this way?

Because it makes the most sense. When you think about it, customers are a good indication of the value (and health) of a business.

Now this works best for businesses that are primarily subscription-based, and generally other parameters are used when calculating the worth of another type of business. If it is a distribution business for example, the gross sales or net profit numbers may be used because each customer varies more widely in their worth.

In a subscription-based business, the monthly net worth of a customer is even more than in a distribution business where one customer may spend $10 per month and another $100,000. You can see how the gross sales figure might be more indicative in this case.

In any business, you can look at the customer base and put a “value” on each customer. The key point here is that customers should be viewed as assets and treated as such.

Note that these assets, your customers, do not appear on the traditional balance sheet or income statement, which are probably the two most common financial statements in a business. Even so, they are assets!

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Management | 1 Comment »

Why You Should Be Wary of Online Reviews

Sunday, May 30th, 2010

Shopping on the Internet has become a viable, low-cost alternative to shopping locally. One advantage of cyber shopping is that you can do it from home, and it is much easier to compare products when you can type the name in the computer and get a screen of prices in response. Many websites are tailored to do exactly this: take a product name and return a list of vendors that offer it for sale, sorted in various ways, including lowest price first. Many sites also provide product reviews for a product, so you can read what others have to say about the product. These reviews come in two forms:
- Made by verified purchasers, and
- Made by anyone who claims to know something about your product.

There is a caveat here. Some product reviews are “planted” by the manufacturer of a product, or by companies hired by the manufacturer. Online businesses have sprung up that offer the service of surfing around on the Internet and inserting positive product reviews. For example, suppose that you manufacture and sell a particular hearing amplification device. You sell several hundred thousand per year. If you want, you can just let the consumers judge your product and enter their own reviews into the many product review sites on the Internet. If you receive good reviews, then excellent, your sales will go up because people will read them and see that you have a good product.

But one day, you are surfing around, reading the reviews of your product and you discover that there are many bad reviews of your product; in fact, many are outright lies about your product. After doing some research, you determine that just as there are Internet companies that you can hire to enter positive reviews for your product, there are also companies (often the same ones) that you can hire to enter negative reviews about your competitors, and you suspect that this is what has occurred in the case of the bad reviews of your product.

How can they do this? Isn’t this type of thing illegal?
Actually, no. Many just consider it a new (and rapidly evolving) form of advertising. So in order to stay competitive, you decide to hire a company that will place positive reviews about your own product and negative reviews about your competitor’s product in strategic places throughout the Internet.

I am not saying that all reviews are bogus; rather, I am just trying to illustrate one of the pitfalls of shopping on the Internet. Yes, you can find tremendous deals, but it is a different way to shop. I tell you this story so that you will read these reviews with caution. Sometimes you can find the email address of a product reviewer and you can send them an email with questions about the product.

An advantage of Internet shopping is that you can easily buy products from vendors that would normally be inaccessible. Some vendors have highly unique products and before the Internet was available, you could not easily browse through their inventory. Some of them did print and mail catalogs, but shopping on the Internet is much more interactive and far cheaper than shopping via bulky printed catalogs. Some websites allow you view a 3-D rendered product from all sides and even zoom in for a detailed view.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Management | 2 Comments »

Using Video Marketing To Market And Grow Your Business

Sunday, May 30th, 2010

Have you noticed how more and more Internet videos are finding their way onto prime time television news shows? It is nearly impossible to watch the nightly news without seeing such a video.

These are called “viral videos” and usually they arrive on national TV because they were interesting enough to be passed around on the Internet. Several top websites carry and rank these videos daily based on viewer popularity. YouTube is one of them.

Viral videos can also be a force in marketing. Consider the Arm Blanket, a simple product consisting of a blanket with two sleeves. The owner puts their arms in the sleeves and “wears” the blanket.

After only a few months in existence, the inventor of this product realized millions of dollars in sales, and this popularity was largely due to viral videos that showed people “wearing” the blanket in different venues.

Before the advent of the Internet and viral videos, to launch such a product might have been very costly and so difficult that it may have failed. But many videos made by the owners of the blanket were passed around on the Internet and served to fuel the remarkable sales of these products. Companies exist that can help you use this new exciting form of marketing.

How is this different than traditional TV advertising?

First of all, distributing the video is free, and that is a very big difference. Second, if you are able to produce a catchy video about your product or service that goes viral on the Internet, you can end up with priceless exposure that translates to millions of dollars in profit.

This is not possible with traditional broadcasting means where every minute is sold at a high price.

This “democratization” of advertising is a relatively new phenomenon and appeared with the advent of the Internet, and possibly will not be available in the future.

Certainly, the large network broadcasters are pounding their heads against the wall trying to figure out how to take control of it and harness it. Until they figure out a way to do this you can—and should—take advantage of this marketing method.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Growth, Business Management | No Comments »

Using Social Media To Market And Grow Your Business

Sunday, May 30th, 2010

Social media refers to websites that allow people to congregate, interact, and communicate digitally using the Internet and web browser programs.

Social media sites include places such as MySpace, Facebook, and others, websites that have been specifically designed for members with a common interest. Social media sites are broadly defined, and this term can also include other, more simple (and subtle) places for people to communicate or collaborate.

A store website such as walmart.com can be viewed as a social media with limited membership abilities. Although members can do only a small fraction of communicating and collaborating, nonetheless, it can be important from a marketing perspective.

For example, Wal-Mart customers can leave feedback about products and experiences they have had with those products. Although this is a limited amount of communication, it is something that affects the marketing equation. Specifically, when a customer leaves a rating on a product, others will see this rating and it will thus affect prospective buyer decision-making.

Each product might have an average “customer rating,” which is a number between 1 and 5, and an area for owners of the item to leave comments.

Believe it or not, there are companies that provide the service of visiting such sites and entering positive comments about products. You can hire one of these companies and pay them per entry to visit product review websites and enter positive information about your product or service. Although this might seem like some type of fraud, it is so new that laws are not in place to regulate it and it is likely that your competitors are possibly doing it.

In fact, the same companies that enter positive information about your products will also enter negative information about your competitor’s products and services.

In any case, you should analyze your particular business and see if it can accommodate a social media site.

It is truly a brave new world. This is only one area of the Internet that affects marketing like never before in the history of business. Note that social media is broad enough to be the subject of an entire book, and for a more detailed treatment, you should search out those books.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Growth, Business Management | 1 Comment »

Using Blogging To Market and Grow your Business

Sunday, May 30th, 2010

A blog is similar in function to a forum (or to a lesser degree, a marketing List), but it is less interactive for the visitors. While visitors can comment on the blog posts, they cannot make posts themselves. In a forum, the visitors can post and comment equally. They are free to create a new discussion topic and then interact with other forum members who may comment on the topic.

In a blog the functionality is more one-sided since the visitors cannot create the postings and this function is reserved for the moderator of the blog. The moderator is tasked with adding posts and managing the comments to those posts. Although the rules vary somewhat between different blogs, this is the general functionality of a blog.

To use blogging in your marketing efforts, you should create a blog and moderate it by adding interesting postings. Once you create the blog, you will be responsible for approving or disapproving the comments.

If you use search engine optimized content, you will find that your postings get hits in the search engines and you get more visitors to your blog, and to your main site if you have links from the blog content to the site. You can also direct the search engines to spider your blog after each entry is posted and your blog content will get hits immediately.

Besides generating additional Internet traffic with the content of the postings, you can also “visit” (manually or with the help of various software programs) other blogs that discuss related subjects and you can post comments in those blogs, making sure to include a backlink from your comment to your money website (your order page or landing page main business page). When someone reads the blog entry or comment and clicks on the link to your page, they are following a backlink to your site.

There are several savvy marketing companies that can assist you with this process and help you get started. You can search Google to identify and compare their services.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Growth, Business Management | No Comments »

Use a Tagline to Help Establish Your Niche in Business

Sunday, May 30th, 2010

If you do not have a tagline and you do not really know what separates you from your competition, yet you have been in business for a while and are doing well, then it is likely that a tagline does exist underneath all of it, and you only need to discover what it is! To do so, you can spend some time looking around and asking questions.

First of all, you can look closely at what your business is doing and how it is different than your competitors.

What is your most popular product or service?

How are you offering it differently to your customers?

What makes you different?

If you work at these questions for a while, but still you cannot get answers that allow you to identify the unique features of your business, don’t despair; ask your customers.

Ask them what it is that keeps them coming back or what it is that brought them to you in the first place. They will likely point out some unique features of your products and or services that you can use in your marketing efforts.

Also ask the people who work for you what they like about your company. They will also be able to provide insight because when a company has something good going for it, usually that feature is also attractive to employees; they want to be associated with the company and work there because of those same features that are attracting the customers.

When you find these unique elements of your business, you are exposing and identifying the niche that you operate in. Understanding and leveraging your niche will allow you to further dominate your competition. You can take it to the next level. This understanding will then help guide you to establishing an effective tagline.

www.andrelarabie.com

andre@andrelarabie.com

Posted in Business Growth, Business Management | No Comments »

« Older Entries