how managing risk can grow sales
“as a small-business owner, i sleep like a baby. i go to bed at 8 p.m. and wake up at midnight screaming my head off.” — unknown
according to the institute for business and home safety, a quarter of small businesses permanently shut down because of business interruptions following a “disaster.” what’s a “disaster?” anything ranging from natural events like floods and earthquakes to human frailties like sickness and injury to technology failures like computer crashes and security breaches.
most small business owners focus on investing their time, money and effort in activities that grow sales. so planning for a “disaster” that may never occur is usually at the bottom of the to-do list (if it even makes it on the list). but what if basic disaster planning can actually position a business to be more successful? well it can, and here are just two examples of how risk management can also grow your bottom line.
did you know there are businesses out in the world that spread nasty rumors about their competitors’ businesses? or that negative reviews posted by dissatisfied customers in a variety of on-line locations can often dominate the results list when people search for your business? how much would your business stand to lose if just 10 customers stop themselves from making a purchase because of what they read about your business?
it’s easy to understand how on-line reputation represents a major risk point for your business, but did you know it can also be an area for generating revenue. how? because effective reputation management dovetails nicely with other on-line marketing efforts (such as content marketing, digital advertising and search engine optimization). coordinating efforts across both arenas makes the resulting impact of both far more substantial.
unless you’re an expert across a wide variety of arenas, hiring a good reputation management service is your best bet for turning risk management into sales. for most businesses it will be a small investment, and you can easily measure how it more than pays for itself within no time at all. [ DISCLAIMER :: reputation911.com is a client ]
what are your contracts really saying to customers and prospective customers?
maybe you went on-line and downloaded contract templates to use in your business. maybe you hired an attorney to create your key documents. either way, they’re bound to suffer from a terminal case of legalese.
no matter how smart or sophisticated your customers may be, none of them want to spend time trying to interpret legalese. or worse, spending money on a lawyer to do it for them.
and when a contract is too long and complex, it will often call your intent into question. a simple, clear & transparent agreement (especially around pricing and deliverables), on the other hand, conveys a high level of trust and professionalism.
all other things being equal, if a prospective customer is facing a contract filled with legalese over a contract that’s simple to understand, which company do you think she’s going to end up doing business with?
so why settle for simply managing potential problems when you can advance your business & its opportunities? yeah, it’s a shameless plug, but it’s also the way a business owner needs to be thinking about business if they want to be successful.
jack speranza is an attorney, small business owner and principal of main street ventures. for 15 years he has helped his companies and his clients strike the right balance between risk and reward by weaving good business, good technology and good law into new services and operations.
the value of a mentor
our focus lies in the realm of small business, but we stay connected to the “big-market” world of venture capital and their “sexy” startups because 1) there’s a lot of talented folks who hang out in that neighborhood, and 2) they’re consistently sharing valuable experiences and insights about growing businesses.
though much of the perspective and advice associated with growing a large market venture is irrelevant to growing a small business, every once in a while we encounter a universal truth worthy of sharing. today we were inspired by an article published by the venture development center at umass boston. here’s our condensed translation for the small business owner ::
- they complete a skills gap :: small business owners rarely have a “team” of high-level thinkers, which means they’re even more behind the 8-ball than a big-market startup when it comes to covering all the skills needed to successfully start and grow a business (think marketing, sales, finance, operations, legal, technology, and human resources). bring in a mentor, however, and many of these skill gaps get plugged.
- experience with prioritizing :: it’s been repeated a gazillion times… to be successful, small business owners need to work on their business rather than in their business. even then, there’s an incredible amount of things to do. the sheer volume makes it particularly challenging for a business owner to prioritize. mentors with years of experience (especially with operating small businesses of their own) have the perspective to guide small business owners towards what they should be spending the most time on.
- making connections :: experienced mentors will have an extensive network — more than the typical business owner. they’re able to introduce the small business to people who can really help make things happen for their business.
- building credibility :: having an experienced mentor can help business owners gain the trust of prospective customers, business partners, bankers and others.
- avoiding mistakes :: mentors have “been there, and done that.” they’ve already made the mistakes every small business runs the risk of making and can help a small business owner avoid dangerous land mines.
the folks at umass rightly posed the question of “how do you know if a mentor has the right qualifications, motivation and time commitment to help?” in response, they came up with a rating system based on four simple questions to help business owners determine if a prospective mentor is likely to meet their needs. again, we’ve made some slight adjustments to account for the variations associated with building a company for “main street” vs. wall street ::
(attach a score to each of your answers, with 1 being low and 4 being high)
- qualifications :: does the mentor have experience successfully building and/or running a small business? has he/she gone through the experience of selling or acquiring another company?
- motivation :: does the mentor really care about helping to build your business or is he/she just involved to do business with your company?
- attitude :: does the mentor spend a lot of time telling you the “right way” to run a company instead of listening to and asking you questions that get you thinking?
- accessibility :: how available is the mentor when you have a burning issue? does the mentor use regular one-to-ones with you as the means of mentorship, or does the mentor swoop in for one-to-manys?
total your score and divide by four. here’s what it means:
1.0 to 2.99 – the mentor is just a contributor.
3.0 to 3.99 – the mentor is, well, a mentor.
4.0 – the mentor is a super mentor, the kind you want.
like the umass venture center, mentorship lies at the core of ZENCubate and all of our other business-building services. we buy into the concept of scoring a “4.0″ on their scale, and you should, too.
special invite for small business owners
how many "hats" do you wear?
- are you the resident expert in marketing, sales, finance, law, technology, human resources & operations?
- are you doing all these things because you want to or because you have to?
- is the guidance you seek out better when it's based on the unique nature of your business or when it's the kind of generic, cookie-cutter advice that's all over the internet?
get specific answers to specific questions from real experts. it's even free. we dare you to find a better return on your investment!
