How To Be A Frugal Business Owner Without Being Cheap

By Thomas Minieri, an American entrepreneur and artist. Founder/CEO of Minieri & Company marketing agency and franchise system.

My experience working with franchisees and small business owners has given me a unique vantage point when dealing with common problems that ail many entrepreneurs. A very common trait I’ve noticed in small business owners is their struggle discerning the difference between smart financial decisions and blanket cost-cutting.
While cutting costs may be beneficial, it can also be fatal if done without careful consideration of outcomes. Companies do not grow by cutting costs; they grow by increasing sales. Therefore, if the owner, in an attempt to lower expenses, deprives essential business systems of needed capital, then it could lead to stagnant growth or negative cash flow. It’s important to consider the unintended consequences of not spending money on important business systems. Many business owners may think they are being frugal when in reality they are being cheap. Frugality leads to efficiency, while being cheap leads to a whole host of problems.

Go Beyond The Essentials

Only spending money on things that are essential will make your company bland and indistinguishable from competitors.
For discussion purposes, consider a restaurant business bathroom. Can the owner get away with white walls, a standard sink and a standard toilet? Sure. While extra nice fixtures in the bathroom may seem frivolous to some, many customers will be positively impacted by a high-quality bathroom experience. It may make a lasting impression and send the message that the business exudes quality and has a unique personality.

Just because something isn’t absolutely needed doesn’t mean you shouldn’t invest in it. Your company’s image is worth the money!

Market And Promote

In my experience, small business owners all too often don’t spend enough money on proper marketing and advertising.
My personal rule of thumb is to spend 5 to 8% of your goal gross revenue. This means that if you want a company that generates half a million dollars in sales, then you should start spending $25,000 to $40,000 in advertising now.
Once fueled with proper marketing spend, your company should be on its way to achieving your goal. Avoid spending based on where your company is today; instead, spend based on where you want your company to be tomorrow. If this formula is legitimately not possible for your business, then take it in stride. The idea here is that the common 5% to 8% of revenue philosophy may be too low for actual growth, especially if you are a startup with low revenues or a business in a highly competitive industry. Alternatively, consider two marketing spend percentages: one that sustains your current gross revenue and another that promotes growth.

Never Neglect Insurance

Smart business owners use insurance as a hedge against losses. In my experience, many business owners get hit with life circumstances they did not foresee. A simple umbrella plan or policy that pays you cash if you can’t work due to injury or illness can make all the difference when faced with the unexpected.
It’s not frugal to ignore insurance; it’s cheap. And it may cost you everything. If you don’t have adequate insurance, get it today. It’s simply not worth the risk.

When It Comes To Marketing, Cover All Your Bases

Make sure that your customer service and sales teams have every tool they need for success. This is what I call marketing insurance.
The idea is to take every action possible to ensure that your marketing dollars (the 5% to 8% of goal gross revenue mentioned above) actually turn into sales.
It’s bad business to spend money on marketing only to ignore things like training your receptionist who answers the phone or buying tools and materials for your sales team who closes deals with customers. It’s almost always money well spent when it comes to communications systems with customers, sales presentations for product clarity and modern equipment for your workers.
In short, if you’re going to spend money to get the phone to ring, make sure there are no broken links in your sales process chain.

Not Everything Can Be DIY

In general, I believe too many people are overconfident when it comes to projects that should be handled by professionals. The desire to save money and “do it yourself” often comes with unintended consequences.
Unfortunately, in business, many of those unintended consequences are not easily identifiable. For example, the business owner who decides to save money by building their own website may never realize that their company is suffering due to their desire to save a few thousand dollars. Branding and marketing DIY projects often backfire because they tend to yield low company credibility.

Construction and repair projects can also prove costly if not handled by professionals. I once had a new franchisee who asked me about a plumbing issue. I told them not to mess with plumbing or electrical despite the temptation to save money. They ignored my advice, and like clockwork, I received a desperate phone call when this franchisee’s brand-new facility flooded with water. My advice the second time around? Shut the water main, and call a plumber!
While some DIY flops can create those “we’ll look back at this someday and laugh” moments, many can seriously stifle company growth due to lack of awareness. The smart business owner knows their strengths and hires professionals to fill in the many gaps.

Learn From Those Who Came Before You

The cheap business owner avoids spending money when they can and should. Being frugal in business means you look past the short-term solution and consider the big-picture consequences with respect to time and money.

If you think about how spending or saving a small amount of money today will impact you tomorrow, then you are well on your way to becoming a savvy entrepreneur. The last tip in this article is to remember to seek the advice and guidance of those who have gone before you. Education and training, especially from successful entrepreneurs, is always a smart investment choice, and one that may not only save you money, but help you grow and scale to your heart’s content.

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Customer Experiences That Get Social Media Attention

Factors of a Memorable Shopping Experience

In its latest study, Avionos exhibits a streamlined experience, convenience, and simplicity in online and in-store purchases factor high among consumers. It highlights both sides have something to teach each other when it comes to satisfying customers’ expectations.

Avionos had 1,250 online shoppers who have shopped online within the past year. It reveals shoppers prefer traditional retailers over digitally native brands when it comes to relationship building and loyalty programs. This is despite digitally native brands having the edge over traditional retailers in terms of in-store experiences, highlighting the need for them to brush on their customer experience.

To start with traditional retailers, need to work on their eCommerce experience as just 52% say they were keen on that index. Conversely, 70% of shoppers see a secure and straightforward e-commerce experience as their top priority when shopping online at digitally native brands, according to the survey.

Digital brands also deliver great in-store experiences, with 75% of customers giving them the nod over traditional retailers. The report says terrible customer experience is detrimental to brick and mortar retailers. Of those surveyed, a significant number (67%) say unfriendly or unhelpful store employees will make them more unlikely to return.

Traditional retailers have a leg up on the social media battlefront. Nearly a quarter of customers (23%) say talking about products with friends or on social media is one of their favorite things about shopping online with traditional retailers. Only 17% say the same for digitally native brands.
“While we see the world change, retailers need to take the time to get the fundamentals right. That means personalization, streamlined experiences, quality products, and convenient shipping options. Without that, there’s no way traditional or digitally native brands will be competitive,” said Dan Neiweem, co-founder and principal at Avionos.
Lessons for Digital Brands and Traditional Retails
Traditional retailers first built their brick and mortar shops and followed through with eCommerce platforms. On the other hand, digital retailers took the opposite route. Despite their differences, there are lessons that each can draw from the other.

Digital brands have a competitive edge in selling online, fast shipping, and streamlined online experience. At the same time, traditional retailers, for their part, excel in relationship building and loyalty.

Additional perks digital brands offer includes a smooth delivery process (60%) and relatively easy return policies (55%). Brick and mortar retailers, for their part, offer faster check out (60%), relative ease of finding products (56%), and a wide range of stocks on offer (54%).
Though distinct, according to the survey, many customers don’t see much difference between the two. When customers were asked to identify their favorite things about shopping online with both models, four of the top responses were the same. Irrespective of the business model, customers rate convenience high. With 66% saying fast shipping gives a business strong points in their book. In terms of fast and free shipping, digital brands (56%) gets a slight edge over traditional retailers (50%).
Similarly, when it comes to personalized product recommendation, the difference was marginal between digital brands (32%) and traditional retailers (36%). There is a significant consensus irrespective of in-store or online the need for streamlining and simplifying experiences. Failing will not keep customers returning long-term, no matter the number of perks or benefits.

The Importance of Customer Experience in a Digital ecosystem
Digital customer experience encompasses all the digital interactions between you and your customer. And the impression that a customer gets from those interactions. Businesses who place a higher premium on producing a better customer experience will be rewarded with more customers, sales, and loyalty.
As more and more customers rate their experiences through customer reviews and word of mouth, businesses should tap into these insights to deliver their offerings better. Companies have to focus on creating further organic buzz to increase brand recognition and customer endorsements.
There is a need to have a better understanding of customer purchasing patterns. And follow through with timely promotional offerings and product recommendations. You can achieve this only if the business has a deeper understanding of the consumers’ interests and preferences. By increasing your customer’s touchpoints and engagement, you can help understand your customers better. And this will allow you to offer your customers the products and services they are looking for.

3 Ways, The Pandemic May, Make Your Business Stronger

During a crisis, for instance, a pandemic like COVID-19, some businesses will thrive, some will survive, and others will permanently shutter their doors. Those businesses that are open to adjusting the way they do business and seize opportunities to adapt and change will be more successful than those that do not. Change is necessary, and especially during troubling times, companies need to reevaluate where they are and where they need to be to remain viable.

Right now, it’s merely not business as usual, and any company with employees needs to install safety protocols, so employees feel valued and protected. Consumers are also looking for assurances that your business is protecting them and that you’re committed to providing your product or service with protections in place to safeguard their health. Consumers during COVID-19 are more careful and more invested in which businesses they patronize, and companies must work hard to retain their trust. While COVID-19 represents a discouraging future to some companies, it also offers opportunities to others. Here are some ways businesses can take on the challenge and turn it into an opportunity.

1. Learn to adapt, and you’ll become stronger

COVID-19 requires businesses to adapt or face failure. Take stock of your business and brainstorm ways to be innovative and strategize. Try new ideas, find ways to execute faster and more efficiently, and be proactive, not reactive.

2. Put your employees first

If you don’t put your employees first already, it’s time to make a change. Your employees’ health, safety, and wellbeing should be your top priority. One could argue all businesses should have been doing this anyway. Still, those who do and truly embrace this as a core fundamental will become an employer of choice for talent, retention, and professional development.

3. Be prepared to handle emergencies

Businesses who are oblivious and unprepared for emergencies like a health crisis, a natural catastrophe, or another emergency could end up closing permanently. The key to overcoming COVID-19 challenges is to inject your business with flexibility and adaptability to weather any disaster and come out on top.

Its possible COVID-19 could be a game-changer for the way businesses will conduct themselves in the future. It has already changed the way customers make purchasing decisions. Those businesses that see potential new strength in pandemic and post-pandemic environments will be the ones who successfully emerge from the current epidemic stronger and more resilient.

4 Business Principles That Endure The Pandemic

COVID-19 has turned our ordinary lives upside down. It has produced fear, uncertainty, and a massive loss of life. The basic principles of doing business successfully and ethically remain a rock-solid foundation for business owners during these tumultuous times.

Businesses that run based on core underlying principles know their customers well and maintain a close connection with them. They also stay agile and adapt to changing market forces. After the initial shock, it’s essential to look beyond the present day and adjust your business as quickly as possible. Here are four strong business principles that have survived the pandemic.

1.People Matter
As always, your greatest asset is your team. Organizations with a robust and loyal group who genuinely believe in the business mission can power through anything. Take care of your employees, first and foremost. Please make sure they are safe, healthy, and provided for. You never know when another challenge will arise, and when it does, they will have your back if you have theirs. A strong team wins every time.

2. Listen to Your Customers
Nourish the customer base that you know so well, contact often, and gain feedback regularly. Leaning on the strength of your customer relationships can help shore up your business during times of crisis.

3.Plan, but Stay Flexible
In any business circumstances, it pays to do strategic planning as long as you stay open to market changes. It’s true that those who fail to plan, plan to fail. It’s no different in a pandemic or other disaster. If you have the necessary plans in place, be sure to build in the flexibility to pivot with different scenarios and stay ahead of other businesses.

4. Look to the Future
Always be on the lookout for methods and technologies that can position your business for success in the future. Stay ahead of the game. Look at innovations that will enable remote operations, alternative work environments to keep your services going in case of another crisis.

In times like these, organizations and individuals need to stick with their guiding principles, maintaining their company culture, and doing what they know is right. A lot has changed, but these truths will always remain.

Article Credit Forbes https://www.forbes.com/sites/jeffbevis/2020/06/24/4-business-principles-that-survive-the-pandemic/#17c1b806778a

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How Should You Advertise On A Small Budget?

There may not be much money left over for advertising once you get your business off the ground. Traditional print advertising, direct mail, and online advertising can be costly and hard to customize.

Once you’ve registered your business for free on the top search engines such as Google, Yahoo, and bing, there are many other relatively inexpensive things you can do to get customers.

Pay-per-click
Pay-per-click search engine advertising, in which you create an account and pay each time a customer searches for specific phrases, finds your web site, and clicks through to visit you, can be very inexpensive. Each click can cost you as little as a penny. It’s essential to be very specific with the search phrases that you specify and are willing to pay for. Using terms that are too general, such as “wedding gift,” could result in too many people clicking through to your web site only to discover that you do not sell what they are looking for. More specific multiword terms, such as “environmentally friendly wedding gifts” result in fewer clicks, but those you do get will be from customers more likely to buy what you’re selling.

Organic search
In addition to pay-per-click, there are things you can do to raise your company’s standing in the nonpaid (also called “organic”) search engine listing. Frequently referred to as SEO (search engine optimization), there is a whole industry of consultants built around this concept. There are a few things you can do on your own to improve your organic search engine listings and, therefore, drive customers to your site. To improve your search engine standing, you should continually update your website with new information and blog posts, Whittington told BusinessNewsDaily. Continuing to update your site with relevant information will get you repeatedly noticed by search engines.

Social media
Social media outlets, including Facebook, Twitter, and YouTube, are venues that allow you to target particular groups of customers for very little investment. You can create a Facebook profile for free and post videos on YouTube, also free of charge. You can also create very explicitly targeted Facebook advertising for a small fee.
Be warned, however: If you are not familiar with social media, learning to use these sites can take time, and using them regularly can be time-consuming. Success depends on many factors, including whether or not your potential customers are the type who use these services and how effective you are (think talent and time) at using them.

Article Credits https://www.businessnewsdaily.com/