Brent Leary

As is often said, the heart and soul of our economy is small business.  The vast majority of new jobs created over the years have been generated by this sector.  And while many of the headlines focus on the exploits of the big guys, it’s the small business community who keeps us afloat.  According to research firm AMI Partners, small and mid-size businesses (SMBs) account for 90% of the world’s workforce, and more than half of its gross domestic product.

But as we all know small business is suffering mightily, as the economy has taken its toll on everyone and everything.  Eventually the economy will get back on track, with small business leading the way.  According to a study released by Microsoft last month (PDF), tech-savvy small businesses will be an important group acting as a catalyst for the overall economy.  And while cost-cutting in the face of economic downturn is essential to survival, many small businesses are turning to IT to lower costs.

According to the study of more than 600 Microsoft Small Business Specialists (MSBS), general economic conditions and declining revenues are actually driving interest in IT at the small business level.  And while 45% of those surveyed expect their SMB customers to spend less on IT in 2009, 30% expect spending to hold steady, with 25% expected actually increasing their IT spending.

Even as some companies decrease the amount they expect to spend on IT this year, their dependence on technology may actually be growing.  The study found 40% of SMBs expect the technology they do implement to reduce overall costs while increasing employee productivity and efficiency.  In fact the survey expects a 20% increase this year in spending on software as a service (SaaS) products. 

Also, technology that enables workers to work remotely will grow in importance as it will allow people to work from anywhere, decreasing costs on both the employer and employee.  And with technology being used more strategically, SMBs will be more efficient in terms of bringing on new employees at the appropriate time to handle tasks core to the growth of the business. read more

It is the best of times, it is the worst of times. It is the age of wisdom, it is the age of foolishness. It is the epoch of belief, it is the epoch of incredulity. . . etc, etc, etc. Charles Dickens must have been channeling Nostradamus as he wrote A Tale of Two Cities 150 years ago, because it sounds like life in 2009.

However, even in the face of a seemingly never-ending supply of economic bad news, small business people are still a pretty optimistic bunch, according to a recent study of 1,000 small business owners performed by Network Solutions and the University of Maryland’s Robert H. Smith School of Business.

According to the study, 69% of the respondents said they turned a profit in 2008, with a slight majority feeling the economy will either stay the same or possibly improve in 2009. That’s pretty optimistic compared to the sentiment of the general population. They’re even more optimistic about the future, with 70% of them expecting to still be in business five years from now – 66% believe they’ll be even bigger by then. Now those are truly great expectations, considering the vast majority of small businesses never see year five.

The study launched the Small Business Success Index (SBSI), which will be a barometer of the overall health of the nation’s small business sector. The index tracks 28 indicators, broken into six main dimensions, to come up with an overall score on a scale of 0 to 100. Of the six main dimensions, which include computer technology, customer service, compliance and workforce, the two most important areas capital access and marketing/innovation.

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Not only are small businesses struggling to find and keep good customers, they’re also having a hard time predicting when an opportunity they’re working on will become cash. And having a good handle on when to expect the cash to come can be just as important as how much to expect. Why do you think Popeye would always lend Wimpy money to get a burger? Because he knew he’d get his money the next Tuesday.

If you can gauge about when it’s coming that can help you plan a more effective money management strategy. And a good way to start improving your ability to predict when deals your working on will become $$$ is to define a few things. Take a look at the image below:

Milestones and Stages

If there is more than one person responsible for selling and/or interested in knowing what’s in the pipeline you’ll definitely benefit from identifying a few basic milestones you may go through when trying to close a deal. The above diagram lists a few as an example. Don’t get scared thinking you need some long drawn-out sales process to follow, but think about maybe 4 or 5 stages you go through on a regular basis when selling. Once you identify these come up with a short description of what it means when the deal is in this stage of the game. read more

Before the Internet, when business was literally done with a firm handshake, small business types relied solely on local customers. The Internet has changed that forever. It allows us to communicate in ways unimaginable only a few years ago. It also makes it possible to discover an endless supply of information with just a few clicks. And these clicks, performed by strangers half-way across the world, may lead to new customers. But there is no possibility of converting clicks into customers if they can’t find us, which is still a challenge frustrating the majority of small businesses.

Back in the day of the firm handshake, the principles espoused in Dale Carnegie’s landmark book, “How to Win Friends and Influence People,” were used by millions of business people with great amounts of success. Although the book was originally written in 1937, it’s as relevant today as it was back then. In fact technology amplifies Carnegie’s philosophies allowing them to impact more people than Carnegie himself could have ever imagined.

And quite possibly the best example of winning friends and influencing people in a Web 2.0 world is President-elect Barack Obama – who many feel has just completed the most successful Internet marketing campaign ever. Here are a few ways Obama’s campaign infused Carnegie’s original concepts with Web 2.0 tools and strategies in order to win and influence millions of people.

Make the other person feel important and do it sincerely

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One thing we as entrepreneurs and small business people recognize is that we have a bit of an identity problem – meaning we don’t have one. At least that’s what it feels like sometimes as not enough people know who we are and what we do, which means they can’t turn to us when they need products and services we could provide them. And in the current economic conditions it is critical to find ways to make it as easy as possible for those looking for the help we can provide to find us.

With that in mind, it’s important for us to understand a new reality. We may think we’re in one business, but now we’re really in two. Yes we’re in financial services, health care, sanitation and other traditional businesses. But in today’s Web-driven world, not only are we running these kinds of businesses, but we’re also running a media firm of sorts. That’s because your customers and prospects are turning to the Web to find help. In fact the 2008 Cone Business in Social Media study recently found Sixty percent of Americans use social media, and 85% those users believe a company should not only be present but also interact with its consumers via social media.

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We don’t often look to a news network for entrepreneurial lessons, but CNN’s Rick Sanchez recently gave us a big one.

Making Customers Feel Valuable

Every customer wants a positive experience when they pull their wallet out to buy something. This experience goes way beyond a low price. Customers want helpful information, a friendly environment, and timely assistance. More importantly, they want to feel important and valuable to the businesses they frequent. Not just for the dollars they spend — they want businesses to show interest in them.

Businesses of all sizes are recognizing that their customers have social needs. read more