Newsletter - 2009 10

Business Success

Brought to You By: BMA Marketing

FINANCE

Small Businesses Have a Range of Financing Options

Although small and midsize enterprises (SMEs) are considered the backbone of business and a key source of economic growth and dynamism, they often have difficulty getting financing to expand, innovate and provide jobs.

There are many reasons for this. SMEs, start-ups and solopreneurships typically lack a long business history and track record of success. In addition, they usually do not have a large asset base to serve as collateral for loans, they often operate in high-risk industries, and they tend to show volatile patterns of growth and earnings.

Seed money to start a business generally comes from personal funds or from friends and family.

However, financing needs evolve as a business grows, and the funding sources used at the start-up stage of development are not the same as those used by established firms that have built up equity and collateral. The range of options for financing small and midsize businesses includes:

• Owners' personal savings, credit cards and lines of credit

• Loans or investments from friends and relatives

• Trade credit from suppliers

• Government loans and grants

• Loans from employees

• Retained earnings

• Business angel financing

• Venture capital

• Bank loans and lines of credit

• Commercial credit cards

• Factoring and invoice discounting

• Equity financing

Increasingly, business angels - such as investors who provide risk capital in return for a stake in the company - are a key link in the financing chain for SMEs, as they bring business experience as well as capital to the table.

SALES

Asking the Right Questions Is Key to Boosting Sales

To be successful at selling, you must engage your prospects with relevant questions and understand what underlies their answers. When someone asks you a question, it's almost impossible not to think of the answer. Try it yourself. What kind of car do you drive? Most likely, the answer popped up immediately. The decision to buy a product or service takes place in a customer's mind. The right questions help focus and shape an individual's thoughts and conclusions.

You might want to add the following types of questions to your sales repertoire.

Interpersonal Questions. Everyone likes to talk about themselves. Asking questions about a client helps establish rapport and build credibility. The information allows you to build upon commonalities such as sports, hobbies and other interests.

Questions about Thoughts, Feelings and Beliefs. Questions and observations about a person's thought process reveals his or her communication style. Does the prospect prefer a direct approach, an informational approach or an intuitive approach? How price-sensitive or brand-conscious is the prospect? Does the person make spontaneous decisions or take time to consider all options? Knowing this information enables you to engage customers in their preferred manner.

Questions about Prior Experiences. Knowing a customer's perception about past experiences will enable you to differentiate yourself from the competition as well as point out relevant benefits and features that will help you close the sale.

Successful salespeople usually listen far more than they talk. They know how to ask questions and what questions to use to penetrate prospects' minds and direct their thinking.

Picture credit.

TECHNOLOGY

How to Design a Winning Business Website

A web surfer typically decides within a matter of seconds whether to linger on your website or move on. To capture the attention of impatient online visitors, your site must be compelling, inviting and attractive. To hold the surfers' interest and ultimately win their business, it must also be functional, easy to navigate and focused on their needs. Here are some fundamentals of good website design.General

• Your website should load quickly and be easy to scan. A common mistake is including too many graphics, pop-ups, banner ads, and flashing or blinking images. These features take time to load and are distracting to viewers.

• Your website should be easy to navigate. Visitors should know at all times where they are on the site as well as where they came from, how to get where they want to go and how to get back to the home page.

• Keep it clean and simple. Web pages should never look cluttered or overdesigned. Good layout employs a balance of graphics, white space and text.

• Use fonts and colors that are easy to read. Overuse of bolding, italics, all-caps and other stylistic flourishes makes reading difficult.

Content

• The content on your site should focus on providing specific information about your services and products. Graphics and other features should not divert attention from the message.

• By refreshing your content regularly you can attract repeat visitors and boost your search engine rankings.

• Be sure that the content and the page headings are grammatically correct. Poor grammar and spelling errors reflect badly on your website and on your business.

Keywords

• Optimize your site. Use keywords appropriately to help viewers determine whether the site is relevant to them. Keywords are also critical to search engine rankings.

• Hone your home page. The home page is what viewers see first, so it should be attractive and welcoming and have useful information.

• From any page on the site, one should be able to get back to the home page by clicking the company logo or business name.

• Include contact information prominently. Visitors should be able to contact you by phone, email or snail mail to ask questions, offer comments and express concerns.

E-Commerce

• If you're selling merchandise online, order placement should be simple and straightforward. In addition, customers should know what they can expect after their order is placed, such as how to print a receipt or track shipping.

In many cases your website is the first impression a customer has of your organization or business. A well-designed website can distinguish you from competitors and attract visitors you can convert into customers.

Resources

• We are seeing many centers successfully using the BPAA's Web Site creation and hosting service. The sites have a clean design and are loaded with useful sections (Hours, contact info, league info, party packages, etc.) and features (built in contact page, photo and streaming video gallery, etc. More info here.

• Our friends at PartyWirks.com offer an instant add-on service for your web site (no matter who is hosting it, BPAA or someone else) - it's an online service that acts as your Online Receptionist, serving online customers 24 hours a day, 7 days a week, 365 days a year. Your Online Receptionist answers questions, takes birthday party and lane reservations, sells party add-ons, emails Online Invitations, notifies party staff, collects information, sends order confirmations and accepts credit card deposits, all easily and effectively...online.

HUMAN RESOURCES

The Pros and Cons of Outsourcing HR Functions

Human resource (HR) functions such as recruitment, training, and administering payroll and benefits can be time-consuming and take special expertise.

As a result, many small and midsize enterprises (SMEs) turn to HR outsourcing to handle some, or all, of their personnel tasks. It enables them to deliver competitive HR services without investing large amounts of capital.

However, the decision to outsource HR functions should be considered in the context of a company's specific needs.

Some benefits to HR outsourcing are:

• Cost Savings: Labor and benefit cost savings can be achieved through hiring temporary employees.

• Effective Delivery: Dedicated providers can offer services such as recruitment and training effectively and efficiently.

• Expertise: An HR provider can be expected to know labor law and best practices and have experience handling workplace issues.

• Focus on Core Business Activities: For SMEs and rapidly growing businesses, noncore and administrative functions are a distraction and a diversion.

• Risk Reduction: Liability transfer is considered a major benefit of HR outsourcing. In some cases, workers' compensation and other insurance risks are assumed by the provider.

Some disadvantages to HR outsourcing are:

• Loss of control over HR functions and standards

• Problems with the provider

• Cost savings may not be realized and HR needs may not be met.

SMEs need to be aware of the potential risks and problems with outsourcing HR functions. Moreover, outsourcing should be limited to noncore or administrative functions that are not central to a company's business.