3 Words You Need to Know to Sell Your Business
Teachable. Valuable. Repeatable.
Those are the three key attributes you need for your business whether you sell a product or a service according to John Warrillow, author of Built to Sell. Good book, quick read.
Take a look at the video where he talks about this with my favorite growth guru, Verne Harnish:
The New 1099 Regs – IDIOTIC
Confession. I am absolutely obsessed with systems and workflow documentation as well as continuous improvement activities (or rather, continuous destruction of non-value added activities).
And that is why I was absolutely livid when I heard about the new 1099 rules passed in the 2010 Health Care bill.
Remember those little 1099 forms your accounting department moans and gripes about each January? Yeah, those. Well, their nightmare just worse. And you will be paying for it.
Our wonderful and intelligent leaders in Washington thought you did not have enough busy work to fill your day. So instead of only sending 1099s to mainly service providers for expenditures over $600 by vendor, the new rules now apply to payments made for goods. I just bet the controllers down in Bentonville (Wal-Mart) threw a party when they learned about this.
Bob Jennings, CPA, is a nationally recognized tax speaker and runs Jennings Seminars which is based in Southern Indiana. He has given me permission to provide an excerpt from a recent newsletter. But here are a couple key points:
1. There will be an additional 40 million filers as a result of this new rule.
2. And that will result in some 8 billion new forms that will be submitted to the IRS.
Dumb, dumb, dumb. Sorry, had to keep this from G to PG-13.
Here’s the excerpt from that newsletter:
In the same newsletter, Mr. Jennings provided the letter he wrote to his senator and representative. With permission, he is allowing that document to be re-printed here. Please take time to read this. There is a CPA version of his letter, and I took the liberty to add another page for business owners like you.
Just slap this on your letterhead and let’s flood senators and representatives with these letters to get this ridiculous law taken off the books.
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No, Health Insurance is Not Taxed in 2011
One newsletter I look forward to reading on a regular basis is the one published by Bob Jennings of Jennings Seminars (an absolutely fantastic tax seminar speaker … and more on this in a minute).
In his last newsletter, Mr. Jennings clarified (and many thanks for doing this) that health insurance paid by employers WILL NOT BE CONSIDERED employee earnings that are taxed in 2011.
Instead, it can be added to the employee’s W-2 for information only on a volunteer basis.
Below is a excerpt from that newsletter. Owners, you may want to drive this point home in an upcoming staff meeting.
Excerpt from October 2010 Jennings Seminars Newsletter which is Copyright (C) material. The excerpt above has been used by permission from Bob Jennings, CPA.
About Jennings Seminars: Years ago, I asked Duane Gravley about his favorite tax training. He said Gear Up. Accordingly, I bought several seminars on CD, and Bob Jennings was one of the speakers. Wow!! This guy was awesome. Entertaining yet masterful at communicating a dull subject and keeping you awake. Now, Mr. Jennings runs his own seminar company, and is a partner at Hurst, Jennings & Co., LLC., CPAs based in Southern Indiana.
Let me offer a couple suggestions about this talented man and his organization:
1. Get the newsletter (CEOs, that goes for you too): Click here to sign up.
2. Fellow partners, office managers, accounting managers, CFOs, and Controllers, consider buying seminar CDs or DVDs either annually, or every other year at a minimum. All content is CLASS A. Click hear to see what’s available. You will not be disappointed. No, your goal is not to be a tax pratitioner. Instead, you want the big picture. While his seminars are for CPAs and Enrolled Agents, you will gain many solid takeaways from his material.
3. Similar to the point above, I love his technology seminar (I have to get it via self-study). Like much of the content above, it’s available on DVD at a reasonable price like all the materials.
Can Your Gross Margin be too High?
Yeah, I think so.
Looks like my local Break Time is working a tad tooooooo hard to bolster their margins.
And no, I’m not their CFO, so I certainly did not suggest this. But my advice to them would be that they are sacrificing turnover for the higher margin.
Joe Gaboury over at Traxia, thanks for sending this pic.
I look forward to seeing this on Leno.
Do You Have a Social Media Strategy?
Time. Not enough of it.
That seems to be the biggest problem when it comes to marketing in cyberspace. Over the past year or so, I’ve either been directly or indirectly involved in the website creation process or the overhaul of an archaic system. But when it comes to maximizing the value of the content on the site, that’s where my clients hit a wall.
Why? First, we’re not trained in such matters (such as integrating the site with Facebook, setting up a Youtube channel, or rolling out a blog). And second, who does it? And where will that time come from?
I”m a partial fan of outsoucing this work, but only with caution. And here’s why. Who knows more about your business than you do? Sure, you first, then your stafff. And who cares the most about your business along with that emotional attachment to the company? Again, same answer. That’s why I still prefer doing this work in-house.
Accordingly, here are my suggestions (the two I’m experimenting with for a couple of my clients):
1. Go ahead and hire an expert to help you with a social media strategy. Let that person explain these tools and how they can help your business. Sorry, you’re on your own for finding the right person. Ask around. Ask people you know. You’ll eventually find that person.
Over the weekend, I read with interest an article in the Harvard Business Review called What’s Your Personal Social Media Strategy. Probably one of the best articles I’ve read on this topic. It starts on page 127 in the November edition.
2. Now here’s the tricky part. Consider hiring a college kid that loves to write and is right-brain dominant–someone with creative skills. Give the kid about two weeks to learn the business, inside and out. Then put them to work. Have them execute your strategy. Make sure you have milestones for each month.
For example, month number one could be getting the blog rolled out with about 15 or so articles written and 20 to 50 more in the pipeline. The next month could be focused on Facebook. You get the idea. And what do you have to lose?
Still Not Sold on Social Media?
I wasn’t either until David Hilton of Freedom Business Advisors passed along this video. Very compelling message. David, I’m sold.
Convinced Now?
If so, here are two more suggestions.
Have that kid (that you will hire), read Inbound Marketing.
Then have them read everything they can at www.hubspot.com (HubSpot was founded by the authors of Inbound Marketing).
When hundreds of thousands start hitting your website each year, drop me a line.
What is Integrity?
A few weeks ago, I wrote about the business books I had my kids read when they were teens (Drew is still on my reading program). The stinkers–they left out one of the business classics: On the Waters of the World by Robert Flood.
Anytime I think about integrity or hear the word, I think of the Meloon family. They founded the ski boat company called Correct Craft sometime in the 1920s or 1930s.
They were pioneers in their industry and some 3,000 Correct Craft boats were sold to our government during World War II leading to many lives being saved.
But times turned for this incredible family. During the Korean conflict, the family refused to pay bribes to a U.S. inspector. Contracts were cancelled, and that one act forced the Meloon family into bankruptcy.
I don’t have time to share all the details (read the book), but in short, the family survived and so did the company.
By 1965, the Correct Craft was released from bankruptcy.
End of story, right? Not so fast. The Meloon family made a commitment to pay back every creditor, IN FULL. Some 20 years later, mission accomplished. Done. Debts satisfied. All of them. Big ones–yep. Small ones–yes, those too.
As a young man reading this at the time, I was amazed, impressed, and moved. They did what was right, and they did it when no one was looking. The author goes into much detail as to how the family labored to find all of the creditors. As a CFO for other companies, that’s the kind of client I want.
So here’s the point.
Never talk about integrity. If it’s in your core values, it’s fine to have that term as a guiding beacon for your employees, but don’t share it with the world. No one will believe it.
You don’t talk about integrity. YOU LIVE IT. It’s a lifestyle. It’s a way of life. It’s a path for the steps you take each and every day during times of success, during times of despair and during times of navigating uncharted territory. It’s about DOING the right thing when no one is watching.
Actually, there is a time you talk about integrity. You talk about it when you coach your management team. But still, showing is a better teacher than telling.
The Meloon family, I salute you, and I’m proud of everything you stand for.
Two Critical Questions in Prepping for 2011
This past week I worked in South Central Washington. Wow!! I love the lanscape. So open. Vast. I love the mountains, although Bill calls them nubs. And the way farmers have developed the land for orchards and vineyards is truly a sight to see.
At left is a picture from my hotel room overlooking the Columbia River. Each morning, I stepped out my patio door to look at this beautiful God-created river. Lewis and Clark were once closer to their destination at the point where I focused my camera.
Looking at the river for some reason caused me to reflect several times over my past year. And questions started entering my mind–questions every CEO should be answering about this time of the year.
CEOs, as you start thinking about 2011, here are two of my favorite questions in my strategic toolbox. Simple, but powerful. In fact, these questions should be the raw material for your business planning for the upcoming year. Here’s the first one:
That’s right, what went right this past year? And better yet, why? By doing a few things right this past year, you now have a starting point for building on the successes you enjoyed in 2010.
By the way, do this in private. Not with your team. Not with the co-owner if you have one. Just yourself. Write down your answers.
Here’s the next one:
Be honest. Again write it down. Honesty takes courage. CEOs, you absolutely have to nail this one down. This will help you to focus even more in 2011.
Like I said, great raw material for planning ahead. Don’t skip this step as we move into the heart of the final quarter of 2010.
The Recession is Finally Here – I've Been Hit
Yeah, I’m speechless.
Here’s what happened.
I’ve been staying in the Hampton in South Central Washington. I never like to carry money with me, especially change (don’t ask … I’m not even sure myself).
So every morning, I leave my change on the table where I work at night. Every night, the change is there, not that I’m keeping track (I always delegated petty cash recons to somebody else when I was a controller).
But then it happened the night of October 21, 2010. The recession hit. The change was gone. Sorry Brock and Julya, Christmas time will be slim this year. Emily, you’re on your own with college. Bubba, sorry, you have to pay for your clothes, academic fees at Heritage, your own gas (and I’ll think of more).
But then I found this note. Looks like the maid just ended her recession.
Marketing 101 – It's Not that Hard
Unfortunately, I’m extremely left-brain dominant. Can’t help it. Guess my mom drop me on the right side of my head when I was born.
Maybe that’s why I enjoy reading and learning about marketing. I especially like hanging out with really creative marketing geeks. Man, they’re so, so idea driven.
But as I step back, my left-brain mindset kicks in. Marketing isn’t just about glitz and glamor. Bottom line, it’s about getting noticed. Period. When that happens, the message, the people, and the brand promise have a chance to generate that all-important sale.
The best way to describe getting noticed reminds me of these pictures below. Below, we have three furniture stores on the same city block. In fact, they stand side by side.
Like most furniture stores that do their going-out-business sale about three times a year annually they stay in business, notice the store on the left gets the great idea to hang a large sign on their building. These guys are going to kick some ____ (sorry, censored).
Well, that makes another store owner really upset, so they decide to counter. Here’s what they do the next day:
Hmmmm. Wonder what the middle store does.
Looks like they are hosed.
Wait a minute. Here’s what they do:
Marketing. It’s about getting noticed.
A little creativity doesn’t hurt either.
Again, I’m a left-brain dominant thinker, so I have no creative bone in my body. So I wish I could take credit for the concept above. Years ago, I found a cartoon showing something similar to the above. I wish I would have kept it. I do not remember where I saw it. I’ve Googled about every key word combination I can think of and nothing pops up. If you find the cartoon, let me know, and I’ll provide the proper due to the creator.
Owner Pay – How Much?
I get this question a lot. How much do I pay myself?
Seems really simple to me. What’s not simple is the discipline.
Let’s talk mindset first, then we’ll address how much.
1. You are an owner, not an employee. So don’t pay yourself like an employee.
2. And finally, you pay yourself from the profits.
Yeah, I know, seems like common sense. But it’s the two items above that cause problems for business owners entering the adolescent stage of their business. I continue to encounter owners paying themselves a set amount regardless of company profits. And next, I see owners treating their business like it’s bank regardless of the company profits.
This needs to change. Curious? Then check out the presentation I use with my clients.
Remember, you’re an owner, not an employee. So pay yourself like one.
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