Rick's Small Business Blog

While people may have different views still good t...

2009-09-24T08:17:19.322-04:00

While people may have different views still good things should always be appreciated. Yours is a nice blog. Liked it!!!

I chanced upon to view your blog and found it very...

2009-09-19T06:35:22.902-04:00

I chanced upon to view your blog and found it very interesting. Great ... Keep it up!

I appreciate the labor you have put in developing ...

2009-08-04T07:16:22.272-04:00

I appreciate the labor you have put in developing this blog. Nice and informative.

I chanced upon to view your blog and found it very...

2009-08-04T07:04:44.244-04:00

I chanced upon to view your blog and found it very interesting as well as very informative, i was need such type information, which you have submitted. I really thankful to you, this posting help a huge number of people. Great ... Keep it up!

Since you seem to be an expert writer, where is yo...

2009-07-28T17:26:17.289-04:00

Since you seem to be an expert writer, where is your article "anonymous"? I think this article was true and relevant; the metaphor was appropriately captured. Before you cap off your comment with a rude "nice try, though" perhaps you should show us an example of an article you've written that makes us care about your opinion.

hello there. you have a very nice blog. your entri...

2009-07-20T06:13:23.661-04:00

hello there. you have a very nice blog. your entries are really nice. what a great read.

As always, profound, necessary & insightful.

2009-06-09T11:44:19.430-04:00

As always, profound, necessary & insightful.

If you want to get philosophical, building a door ...

2009-04-29T13:49:00.000-04:00

If you want to get philosophical, building a door can be seen as a metaphor of putting up a barrier to opportunity. This quote is clever at a superficial level, but not quite robust enough to warrant an article on it. Nice try, though.

Great blog. It discusses a very intriguing point. ...

2009-04-27T07:58:00.000-04:00

Great blog. It discusses a very intriguing point. Small business owners will find it helpful as it encourages them to be innovative in their businesses.

I recently came accross your blog and have been re...

2009-03-28T07:38:00.000-04:00

I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Joannah

http://myscones.com/

I recently came accross your blog and have been re...

2009-03-26T06:40:00.000-04:00

Sorry to hear the client blamed your SBDC for thei...

2009-02-22T19:57:00.000-05:00

Sorry to hear the client blamed your SBDC for their failure. As a receiver of SBDC advice, I realize that ultimately what happens to my business is entirely my responsibility. You don't work it...I do. It's easy for someone to sit back & give advice & much harder to take it & implement it. Which is why at times it may seem that I move at a snails pace. I don't want to make the wrong decision & drag my feet. I would never blame my counselors...might be mad at them...but never blame them.

Excellent post! I couldn't agree more. I typical...

2009-01-21T10:20:00.000-05:00

Excellent post! I couldn't agree more. I typically don't get worked up about politics but this year I did. Maybe it's because he seems to care...seems real...seems to want to do something about our situation. What I got from his speech is that we all have to help get us out of this mess...one man alone can't do it. Millions together can.

Thanks for the shout out Rick! You're right on - ...

2009-01-13T00:33:00.000-05:00

Thanks for the shout out Rick! You're right on - particularly like the comment about Lake Champlain. It is a tough time, yes but what are you doing to manage the area between your own ears will be much more important than how low you can make your margins.

Excellent post. Honestly, I've stopped watching t...

2008-12-29T23:16:00.000-05:00

Excellent post. Honestly, I've stopped watching the news. I only scan the paper & I avoid talk of the recession. All it does is add unwanted & unneeded fear & panic to my life. I don't live with my head in the sand...I know what's going on. But a steady diet of the doom & gloom from the media is only making the problem worse. And I'm sure you're well aware that I produce my own doom & gloom without any help from them.

Finding that "want" item is the carrot I'm after.

And while my new converse aren't purple, they are gold & sparkly :)

Very well said!

2008-11-04T09:54:00.000-05:00

Very well said!

2008-11-04T09:52:00.000-05:00

Very well said!

We've gotten an economic system, with all of these...

2008-10-03T15:09:00.000-04:00

We've gotten an economic system, with all of these financial "packages" as a Ponzi scheme. No real wealth being created; no wonder it fell like a house of cards.
What to do? Haven't a clue!

Rick,This blog is spot on and is not only limited ...

2008-09-16T09:23:00.000-04:00

Rick,

This blog is spot on and is not only limited to small business organizations. Lisa Ford has some really nice media relating to the effective ways to hire, train and reward employees. Your "hire for attitude, train for skill" comment reminded me of some of Lisa's strategies for effective customer service. It is as simple as "customer turnover is directly related to employee turnover". Lisa gives 5 keys to effective hiring and sure enough, # 2 is to hire the attitude. A major mistake both large and small organizations make is that they do not invest enough time in the interviewing and hiring process.

My predecessor at my company made that mistake prior to my arrival at the company. The company was going through serious scrutiny from our external auditors over its accounting procedures, and desperate for "another body" they hired, well, just another body. I was at the company but 3 days, and after 1 conversation with the "body", I called my Controller into my office and questioned his ability to hire. Of course he quickly pointed out that it was not his hire, but rather my predecessors'. Sadly, my predecessors' skills as a CFO mirrored his interviewing skills which I guess explained the accounting issues I had to fix.

I only bring this up to show that larger organizations (we are a publicly traded company) suffer from similar issues as small businesses do.

I would like to add to your blog if I may. Not only is it important for the business owner to "learn not to be there" it is equally as important for the business owner to plan for one or more of their employees to "not be there". And what I am referring to is the importance of cross-training. A well-oiled machine works as well as the sum of all of its parts. What an organization does not want is for its operations to stumble when one part is missing.

As CFO, I have created and implemented a TCE (Train, Cross-train and Empower) program. Each of my employees are not only trained to perform their functions, but are also able to fill in when someone else in the department is out. This type of program satisfies two of my concerns as a manager: 1.) enabling the department to run effectively even when there is absenteeism (or "what happens if you get hit by a bus"); 2.) I am NEVER backed into a corner by a potentially disgruntled employee who has a gun to my head because he/she is the only one who knows the job.

While smaller (and some larger) businesses may not have the wherewithal to produce training videos similar to those of the major fast food establishment you referred to in your post, it is indeed vital for all organizations to invest the time to develop detailed training manuals for all of the functions of the organization.

An organization cannot allow employee turnover to impact customer satisfaction. The best investments a business owner (or manager) can make is the investment of time in the hiring process and the investment of time in training and cross-training.

I am aware that my comments are essentially a regurgitation of yours, but as they say, imitation is the best form of flattery.

Incentives work for any sized company. The key is...

2008-09-11T11:28:00.000-04:00

Incentives work for any sized company. The key is to only reward bonus performance. If they are pushing a certain product line, see if your sales rep will give you something to give your employees as incentive. If you are just trying to increase performance, set benchmarks that you hope to exceed. If your breakeven sales are $1,000/day and you make a 40% margin, consider giving something valued at a few percentage points of every sale over the $1,000.

Rewards could be cash, gift certificates, product or anything. It's up to you to figure out what motivates your staff more.

I read a lot about sales contests for employees, b...

2008-09-11T10:20:00.000-04:00

I read a lot about sales contests for employees, but it seems to be McDonalds...The Sharper Image...big places. Do they work for very small employers? For instance, would you give them a goal to reach for the day, such as selling so many of a certain product? Or do you try to get them to exceed a dollar amount? What do you do if they fail? And is the reward monetary? Gift Certificates? Product? Very interesting food for thought....

You've said it perfectly. Thank you.

2008-09-11T10:16:00.000-04:00

You've said it perfectly. Thank you.

Hi Rick, I appreciate you posting my article and y...

2008-08-28T08:07:00.000-04:00

Hi Rick, I appreciate you posting my article and your advice. To clarify my point, you don't offer coupons and discounts to people who don't know you. There are plenty of cheap people out there who will take advantage of them. It doesn't work as a long-term marketing strategy. However, I do believe in coupons, rewards, bonuses, free gifts, etc for people who already shop with you. Much like frequent flyer mileage credit cards, you want to build loyalty when they are already loyal to you. For more tips, visit my website www.retaildoc.com or read my blog at http://bobphibbs.wordpress.com

Just what I needed today. Thank you!

2008-08-26T10:20:00.000-04:00

Just what I needed today. Thank you!

I personally do not invest in the stock market (ex...

2008-08-21T10:04:00.000-04:00

I personally do not invest in the stock market (except the portion of my mutual fund that is dedicated to a company managed stock portfolio). The reason is because I am uncomfortable with the dual value of stocks. The initial premise of the stock market was to allow companies that have developed a profitable business concept to grow to larger proportions. It should be a win/win scenario where investors who haven't come up with their own ideas can invest in those companies who have proven formula for success and want to grow. The problem is that stock prices get tied to "market" factors outside the actual performance of the company.

For example, there was an earning report on Home Depot stating that their profit went down 24% compared to last year. Negative news, so their stock price lost value. Home Depot today is trading at about $30/share. Last year at this time it was at $40/share. So if you had Home Depot in your portfolio and held on to it, you lost 25% of your value. But let's look at Home Depot's performance last year. They did $77,349M in sales and made $7,242M in operating profit. That's a 9.3% net profit margin. Pretty good from my stand point. There were about 1,849M average shares of Home Depot last year, which results is a $3.92 earnings per share (this is based on operating profit, not net profit). So from operations, if you bought a share for $40, you would have made a 9.8% return on investment. If you got in at $30, it would be a 13% return on investment. Both are pretty good numbers...better than you would do putting that money in your money market account. So why the decrease in stock value? Well earnings are decreasing, people are worried about the housing market (let's not forget the "home" in the name) and investors make their evaluations on stock based on those factors, not just the return on investment potential. So people start selling off Home Depot stock so they can invest in something that will give them a better return. Home Depot no longer has cash from investors, so they have to borrow money to grow (don't forget the old saying, "grow or die", hence, the lower net profit to pay for interest to borrow that money. This brings the earning down to $4,395M or about $2.37/share.

My opinion is that if you hold on to this for 10 years, so many things can happen to increase of decrease the value of your investment that are not directly related to Home Depot's actual performance. You are counting on their executives to make wise business decisions with the capital available. You may find out that they made an accounting error and really didn't earn what they stated and the following year they have to "write off" other losses. Even being profitable, if the Dow index plunges, people might sell off Home Depot shares, thereby decreasing the stock value. To me, it's just hard to speculate.

GM five years ago was at about $26/share, now it is hovering around $10. Here are my four darling companies that I have been tracking and would have invested in if I was willing to play the game...BP, Southwest Airlines, Johnson&Johnson and Church & Dwight (they make Arm & Hammer Baking soda...located in Princeton NJ). J&J went from $51 - $71. BP from $15 to $69. Southwest from $16.5 to $15. Church & Dwight from $22 to $61. I would have done pretty well, except for the Southwest. But I am still holding out for Southwest to improve. Why these choices, not because I believe the stocks will gain value, but I believe in their products/services and company philosophies. Part of me thinks it is pure luck looking at these performances, but another part of me thinks it has to do with me caring about what the company's business model rather than wondering whether I would make money. I like Southwest's flair and how they approach air travel better than all their competitors. I got to know some BP executives when I was working in Alaska and I just liked their company philosophy (they truly are investing in alternative energies). I like the fact that baking soda has so many applications and I still think J&J is on the cutting edge of developing great home health care products (plus I still haven't found a generic band-aid that matches the comfort of a J&J brand!). But aside from performance to date, my opinion remains that these values are still at the whim of the market and could plummet at anytime.

After this long winded explanation, my conclusion is, don't listen to me for investment advice! I don't want that responsibility. May I suggest reading some of Warren Buffet’s books? Or investing in a small business that has a good plan and gives you the opportunity to take part in the decision making process.