Depending on the type of start-up you have, there is a financing model to optimally fund your business. If you are running a home-based business then you can use your savings and credit card loans. If your ambitions and ideas are larger than normal, then you may consider other ways of funding your business. Remember to select your financial options carefully or else it can lead to conflicts between you and your financiers which could then lead to a possible shift in control of your business. We have put together a few ways to get business angel funds.

• Approach banks for debt financing – According to a survey conducted by the Federal Reserve, 26% of banks experienced a demand for commercial and industrial loans from small businesses during the fourth quarter of last year. Many small businesses are approaching their local banks and other financial institutions for debt financing. In debt financing, if you have good credit, then banks will provide you the credit you want, but you have to repay the amount in a stipulated time period with interest. “In addition to showing a successful track record in managing their business, we also consider the customer’s existing account relationship with the bank as one of many factors in making lending decisions – and this can also include their personal banking experience with us,” said Brad Baumann, Vice President at Washington Mutual.

• Equity Financing – In this form of funding, private institutions or individuals are willing to fund your venture in exchange for an equity ownership stake. They include angel investors, venture capitalists and friends or family. Let’s take a look at each one of them.

• 1. Venture Capitalists – If your venture is in the second phase of a start-up and you need funds to be injected in your business, then you should go with finding a venture capitalist. Venture capitalists are serious players in the business world and their funding is very time-sensitive, they will only fund a business that shows potential of “fast growth.” However, if you can convince them to fund you along with investments, they will provide you business networking opportunities for a better chance of success.

• 2. Angel Investors – Angel investors are individuals or a group of individuals who are willing to invest in a start-up. They are called “Angels” because they are friendlier than venture capitalist in terms of time. Along with just funding a business, they are very patient and good mentors who value relationships. Angel investors usually make an investment of $25,000 to $1 million. The only major drawback is they may be difficult to find.

• 3. Friends and Family – You can talk to your friends and family about your venture. There’s usually someone among them who would be interested in investing in your business. It is always wise to stay professional when you borrow money from your friends and relatives. It would be wise to ask a lawyer to draw a legal document stating the amount borrowed and other terms and conditions. Remember to inform them of the various risks of your business and also keep in regular contact with them.

• Look out for government grants – Depending on the type of business you are in, you can check out Small Business Administration for various government grants. There are different types of SBA programs such as Small Business Innovation Research (SBIR) and Small Business Technology Transfer Research (STTR) for those who venture into technology and research. You can also check out the SBA loan programs.

• Crowd-funding – This is a new source of funding that is fast becoming a vogue in the financial industry. This is a new strategy where a network of people come together to pool their money and other resources to support those who need funds to kickstart their dream ventures. The advantage of crowd-funding is that the money is a gift and not a loan; therefore, it does not come under taxable income. A point worth mentioning is that you do not have to take on financial partners.

The bottom line is, you need to choose wisely. Remember nothing is as easy as it looks, you need to do you homework to choose the right kind of financing from the right source at the right time.

Flickr image by 401K

Have you exhausted the financial help from your friends and family to take your business to the next level? What do you do? It’s time to start looking for someone who is willing to invest in your start-up. Angel investors are investors or a group of investors who are willing to provide you a second-round of funding or the seed money for a startup. In return for their favor, angel investors will take a portion of equity from your company. However, keep in mind that these investors will invest only a small amount of money but will expect a higher return and also a way out of the business down the line. There are cases where angel investors want a monthly management fee. This is because they are taking a huge risk on a relatively unproven venture.

Where do you Find Angel Funding?

Finding angel investors directly can be a bit difficult because they prefer to stay anonymous. There are a few angel investors who have professional managers screen deals for them. You have to find an investor who understands your industry and is familiar with your business model. We have put together a few pointers that will help you find an investor who will understands your needs.

• Call your nearest university – Universities that conduct entrepreneurship programs can help you find angel investors. You can schedule an appointment with the person who conducts the small business programs. They will help guide you in finding an investor.

• Websites – There are websites such as Angel List and Gust where you can locate angel investors in your area.

• Angel networks – There are certain investors who keep aside funds for angel investments. They form a network of investors who have a professional team to help screen entrepreneurs. Instead of having one person invest in a business, it would be a group of investors who invest in your business.

• Business Incubators – Another place where you can find angel investors is with business incubators. The president and CEO of the National Business Incubation Association (NBIA), Dinah Adkins, believes that there are around 1,000 business incubators in North America and they are more than willing to offer formal or informal access to angel investors.

• Venture Capitalist Clubs – These clubs are usually non-profit groups formed by angel investors. They sponsor events on numerous aspects of entrepreneurial such as writing a business plan, how to obtain SBA financing, current management trends, how to seek capital for your venture and much more.

Some other places to look for angel investors include Chamber of Commerce, Small Business Development Center or the Economic Development Agency. If you are banking with your local bank, they can give you information regarding the angel investments in your area.

It is a fact that Angel investors are a good source of funding for your small business. You should also realize that investors are not going to write blank checks for you. They will want to see a solid business plan, which displays the fact that there is a market for your product/services. No matter what, you will have to make a couple of presentations about your business strategies before you can convince them to invest in your dream project. A good investor will not only provide you your monetary benefits, but also give you their expertise advice as well as networking opportunities. Therefore, choose your Angel investor wisely.

Flickr image by 401k

For many years you wanted to get away from the monotony of your regular day job and wish to venture out on your own. Starting a start up is a dream held by many of us. However, before you become an entrepreneur, there are certain questions that need to be asked. Is your dream project unique? Will it survive in this economy? How soon will it grow? When will it reach the breakeven point and start giving returns? The only way to know is to try it out. We have put together a few tips that will help you prepare yourself, test your idea and improvise before you actually launch your start-up.

• Find the best Industry that fits you comfortably – Choose a field that will suit your style and talents. You should start by talking to industry veterans and counselors. The Small Business Administration (SBA), the Women’s Economic Development Agency and SCORE are a great start to provide you with information and guidance about the industry you are interested in. Other invaluable sources of information are available at your local library, the U.S. Census Bureau and the Internet.

• Know what your competition is doing, so you can do it better – Once you have decided the type of industry that you want to be in, spend some time studying your competitors. This can be easily done by visiting the local store and inspecting the product yourself. Remember to check out the prices and packaging. If they have a website, you can gather more information by visiting their site and putting yourself on their e-mail list. Another way is to signing up for e-mail alerts that are relevant to your products. You can also approach business data aggregators such as InfoUSA and Dun & Bradstreet to get a detailed company profile.

• How will you fund it? Think about it – Have you saved enough to bootstrap your company? Are you planning to apply for a small business loan? Is your family or friends going to invest?  You should know whether there are Angel Investors who would be willing to fund your venture. The sad truth is, no venture capitalist will be willing to invest in your business for the first couple of years. After that, they will take the risk only if your business has a solid business plan and shows future growth potential. Keep in mind, cash is king.

• A good business plan is mandatory – A business plan summarizes your vision and mission statement. It is important because it guides you in operating your business successfully. This is a vital management tool which helps plan your marketing and advertising strategies.

• Never shy away from refining your concepts – If you feel some of your strategies are not working, do not hesitate to turn to your plan B. You should also try diversifying your business. For Instance, if you are a moving company, move away from the traditional practices of a moving company and give value added services such as house cleaning, room reassembling, antique appraisals and charity donations for senior citizens or physically impaired people.

• Understand everything takes time – You cannot become profitable overnight. If you think you are going to break even within six months, you are wrong. It is one of the myths about small businesses. Despite the hours of hard work you put in, there are going to be unforeseen events that will take your forecasted time twice as long to complete.

• Credibility matters – You might be the best in the industry in meeting your targets while working for an organization, however, when you’re an entrepreneur, you are the new kid in school. Here you must build your reputation before you approach banks or other private institutions for financial help.

• People are an asset – In the initial stages, along with funding, you will need the most support from your friends and family. Talk with your friends and family about your business idea to find out who would be willing to give a helping hand during their free time. You would need all the help you can get in the initial stages of your business.

• Put a marketing strategy in place – You should know your target audience and strategize a marketing plan according. Time is valuable, and you don’t have resources to waste on those who are not a part of your target audience. Here are a few marketing strategies that will be helpful.

• Test your idea – Before your business becomes operational, you should do a test-run on your products/services. This way you will understand the preferences of your customers intimately. You can also use the online survey services of Zoomerang.com, Surveymonkey.com and constantcontact.com to get feedback from potential consumers.

Last but not least, don’t forget to give your business a catchy name. Ensure that your business is registered, even if it is small in size.

Flickr image by dierken.

Facebook is one of the most popular social media platforms where millions of people spend hours connecting with their friends and family. With the growth of smartphones, many people can access Facebook through their mobile devices. Facebook advertising is gaining fast popularity among small business owners because they can target ads to specific demographics, which helps increase the web traffic towards the site. We have put together the pros and cons of Facebook advertising for you.

Advantages of Advertising in Facebook

• You can reach out to a global audience – In August 2011, there were more than 750 million active users from around the globe on Facebook. Advertising with Facebook gives small business owners a chance to showcase his products/services to a diverse audience in various geographical location, gender, income and age.

• You can target your audience – Small business owners can have advertising campaigns targeted towards specific age groups, geographical location, status and gender. Owners can target their local consumers by advertising on Facebook. Local communities can reap the benefits of discounts on products or services and take advantage of reward programs offered to them.

• Facebook advertising is cost-effective – You can open a business account with Facebook for free and implement your marketing and advertising. Facebook allows you to purchase ad space based on a pay per click or impression based fee structure. Therefore, you can plan you daily budget for advertising accordingly.

• Make direct sales from the Facebook business page – Facebook is a friendly social media platform that people around the globe are using. Therefore, placing an ad here means your products are visible globally and easily accessible. To make things easier for the audience, you should set up a “product” tab, which makes it possible for customers to make a direct purchase through your Facebook business page.

Disadvantages of Advertising on Facebook

• The fee structure for Pay Per Click (PPC) for niche market is high – There is a misconception that advertising costs for target marketing is low. Online marketers believe that PPC for niche areas is similar to the general pricing of demographic targeting. Therefore, many online businesses think if Facebook optimizes the fee structure for niche market, there can be good traffic to their site.

• Conversion is easier said than done – Though many people may view your ads and click on them to enter your site, not many will go through with buying from your site. It is not easy to convince people to stay on your site so they can better understand your product.

• Irrelevant ads- There are ads that may distract you from what you are trying to look at. Facebook is flooded with ads such as reward programs, humor sites and free giveaways. These make the other important ads look less relevant.

• People spend more time on one page – Another disadvantage is that many viewers tend to spend more time on one page, than going through other pages. Facebook is generally considered to be an ideal way to connect with various people, for businesses who are paying to advertiser, it can be a loss of opportunity.

Even though every click cannot be converted to a sale and what you offer may not be relevant to what people are looking for, but Facebook has one of best online platforms for placing ads. It’s a chance to grab the opportunity to be successful.

Now it is up to you decide whether Facebook advertising is right for you or not.

If you are planning on doing business with someone again, don’t be too tough in the negotiations. If you’re going to skin a cat, don’t keep it as a house cat. – Marvin S. Levin (American Author)

In today’s competitive world, negotiation is one of the skills that everyone, including a small business owner, should possess. A question that is commonly asked by everybody is “What’s in it for me?” Therefore, if you want to get a good deal out of your negotiation, you must be very clear about what you want. You may not always get what you ask for but you can get what you negotiate. If you want to manage or overcome lots of awkward situations, both in your personal and professional relationships, you should possess good negotiating skills.

Qualities of a Good negotiator

• A good negotiator is neither pushy nor aggressive. He gets what he wants amicably without being too demanding or caving in to other parties demands.

• If you know how to negotiate at your workplace, you would be able to get what you want without harming your relationships. Good negotiating skills enable you to be successful in your workplace.

• When you know how to negotiate, there is a less of a chance that anybody will take advantage of you. Use your negotiating skills to maintain an amicable relationship with your neighbors or other members of your community.

• A good negotiator will bring about a good outcome where all the parties involved will feel that they have been treated fairly. It’s important for all parties to come to the negotiating table with an open mind.

Tips to Keep in Mind While Negotiating

• Know what you want – It is advisable to plan ahead if you want the outcome of the negotiation to be a success. An important aspect of a successful negotiation is a well planned strategy. This is applicable in both your personal and professional relationships. If you are sure about what you want, your opposition cannot take you for a ride.

• Realize that win-win situation does not always occur – It is always better to condition your mind that there are winners and losers to every negotiation. If you are a seller, the buyer would always want the best and maximum he can get out of a deal. If you want to get the most benefits, understand what the buyer wants and how much he wants to pay for the product/services. Ask the right questions and remain focused on your objectives.

• Be calm and exhibit patience- Patience is considered a desirable virtue while negotiating a deal. Even if you are desperate for the deal to happen, never show it on your face. Your body language should exude confidence, or else the opposition is likely to force you to agree to their terms and condition.

• Know when to agree and close the deal – If you want to maintain a good relationship and continue doing business with the other party, never be too greedy. It is worth mentioning that you cannot cash in all the benefits. There are times when you have to compromise on certain benefits to close the deal. Therefore, it is important to know when to count your benefits so the other party feels it has been a fair deal.

• Know when to walk away – There are times when it is better to walk away from a deal than give too much up. It is a challenge to walk away from a deal when sales are down or during a recession. However, there will always be someone to buy your products/services at a much better price.

It is imperative that you harness your innate and acquired negotiating skills to get the best possible deal for your business.

Flickr image by U.S. Embassy Tel Aviv

Recently, I had gone to lunch with my husband in a small restaurant near his office. I ordered a Greek Country salad, cheese and tomato pasta and Gap juice (mix of guava and pear). I had almost finished half of my pasta, when I noticed there was a small bit of polythene in my pasta. I called the bearer and showed him the polythene. He took back the pasta and came back with a full plate of the same item. Later, as we were leaving, the manager came over to offer his apologies. I was touched by their customer service. Now I am their regular customer for Sunday brunch. They have found a loyal customer in me.

The customer is the king. He is the one who decides whether your products/services should be a success or not. As an owner of a small business or a customer care manager of an organization, you may have to deal with unhappy or angry customers/clients all the time. Dealing with them is not very easy and they have to be handled with care. However, if you know what to say and how to say it, you might be able to gain their trust. Dealing with unhappy clients/customers can be very challenging. “Your most unhappy customers are your greatest source of learning” says Bill Gates. We have put together certain tips that will help you handle such a situation smoothly.

How to Handle Unhappy Customers

Step into your customer’s shoes – If you realize that your customer/client is unhappy, analyze the situation from their point of view. Adjust your mindset to that of your customer’s and focus on solving the problem for them. Keep in mind that all that matters is that your valued customers are happy.

Active listening is the key – Listen carefully to what your angry or unhappy customers have to say. Do not interrupt them when they are speaking. If a customer has sent you an email or written a letter, ensure to respond promptly. A point worth mentioning here is, when you are actively listening, neither should you jump to conclusion of what had happened nor should you solve the situation immediately. Instead, listen carefully to what the client has to tell you.

Use calm and neutral words to start a dialogue – Once the unhappy client is over with his explanation, you should repeat his concern. By doing so, you let him know that you have been listening to him attentively. You should also clarify your doubts to ensure that you have identified the problem correctly. The anger and stress levels of your customer will come down when you agree on his issues.

Empathize and reassure them – Empathize with your unhappy client once you understand the problem. Ensure that your body language matches the tone of your voice while dealing with unhappy customers. Keep in mind that customers are always right, even when you know they are wrong.

Give the customer a solution – Give a solution to correct the situation. If the customer is not happy with your solution, give him/her the opportunity to resolve the issue. Don’t shy away from asking the client to identify what will make him/her happy. Come to an amicable solution that will benefit both you and the client.

Keep in touch with your client – Once the problem has been resolved, you should not put his records in the back burner. It is a good idea to keep in touch with him/her to know if he/she is happy with the service. Occasionally, send a gift or a discount voucher. This way you can reconnect with them and also let them know that you care about them.

Last but not least, if it was the error on your part that made the customer unhappy, you should know how it happened. Find the root of the problem and fix it without any further delay; so an unhappy customer will not turn up in your doorstep again. You should work on improving your conflict resolution skills so you can handle such situations proficiently and professionally.

Flickr image by aleutia

It is the dream of many to become their own boss. Aspiring entrepreneurs see other small business owners becoming successful and think of starting their own ventures and making it big. Many of us see only the pot of gold at the end of the rainbow. However, the realities of starting up a small-medium business are dwarfed by myths. The reason small businesses close down after a couple of years is because they were not able to meet the challenges of the real business world. To save your time and money, we have put together a few points that will help you make smart decisions for your business.

Small Business Myths Busted

• Myth: I can spend more time with my family

Fact: You will start to feel that 24 hrs in a day is not enough. As a start up owner, you have to put in a minimum of 18 to 20 hours in a day if you want to succeed. Keep in mind, a start up is very time consuming.

• Myth: The federal government has set up grants for start ups
  

Fact: The government does not fund any business directly. They have special grant programs for veterans, minorities or people with disabilities. However, to be eligible for these funds, you need to meet certain requirements. Beware of the firms/institutions who claim they will be able to assist you in getting government funds.

• Myth: I can obtain a loan from SBA (Small Business Administration)

Fact: You are wrong. SBA is an independent government agency which advises people on three types of loan programs that will benefit small business owners. It is not a lending institution and does not lend money to small business. The three loan programs under SBA include 7(a) loans, 504 loans and micro-loans or 7(m) loans. To obtain these loans, you must meet a certain criteria; such as your credit score.

• Myth: A business plan is not necessary because I know what to do/ there is no bank loan involved

Fact: You need a business plan. It will give you a clear picture about your mission, your budget and strategies for your business. Above all, if you want to apply for a loan in the future, banks will ask for your business plan.

• Myth: You can approach Venture capitalist for funding your start up business

Fact: Not a bad idea. However, your business must be a minimum of 2 to 3 years old and have a good track record. Above all, you should have a solid business plan and your venture should show potential future growth.

• Myth: There is no need to register my business, it is very small

Fact: Whether your business is very small or small, you should register it. To legalize your business and to pay your taxes, you should register your business. By doing so, you are creating an identity for your business.

• Myth: People will buy my products/services

Fact: They will. However, you need to market and advertise your goods and services. You should know who your target market is, done your market research and priced your products to be competitive. There are many factors that go into marketing and advertising. You need to have a good plan and fix your budget accordingly.

• Myth: I can take however much I want as my salary.

Fact: Sorry to tell you, you are wrong. As a business owner, it will take a couple of years before you can take a substantial amount as your salary. Cash flow is the key to any business. Hence, in the first few years, you may have to pump in money into your company. This is where you need to have a solid business plan and marketing strategy.

• Myth: Being an expert I will breakeven in the first year.

Fact: Starting a business in your niche area does not mean that you make profit in the first year. Making a profit at the same time as creating a unique brand is a lot harder said than done. There is a lot of hard work and factors involved. Some of the factors are customer preferences, market forces and economic conditions. To get your business on a steady ground it will take years and a lot of reinvestment.

Fantasizing about starting a business is wonderful. However, in reality it takes a lot of hard work and planning to make your big dream come true. If you still want to be an entrepreneur, give yourself a chance to chase your heart’s desire.

Flickr image by Melody Campbell

The motto of any business is profit. “At what point will my company start making a profit? When will I be able to take home my salary from my company?” These are the questions asked by all new entrepreneurs. To give a fair idea about when your company’s marketing and sales graph will show an upward curve, we will discuss the break-even point and break-even analysis.

What is Break-Even Analysis?

When the revenue of the company is enough to cover all its expenses, then you can safely say that your company has reached the break-even point. At this point, there is neither loss nor profit. However, the break-even point is a very important marketing tool to formulate in order to strategize a way to calculate the net profit of your company. The impact of the marketing strategies is determined by the dynamics of the break-even point and the break-even margin. While discussing about the break-even figures, fixed and variable costs have to be mentioned.

How to Calculate the Break-Even Point?

The simple formula to calculate break-even point is given below

Break-even Point = Fixed Costs/ (Unit Selling Price – Variable Costs)

The result obtained using this calculation will let you know how many units of products you need to sell to achieve the break-even point. The end result of the break-even point is used to analyze and revise your business plans. This is known as break-even analysis.

To apply this formula, you should know what Fixed costs, Variable costs and Average/selling price per unit are.

• Fixed Costs - The expenses such as rent, administrative payroll, deposits or contingency funds that do not change from month to month regardless of how many units you managed to sell is known as fixed cost. “Be sure to include everything. People forget about things like deposits or contingency funds, which can add up to a sizable amount,” says Jerry Chautin, business mentor in Atlanta and Sarasota, Florida.

• Variable Cost – The expenses that are likely to rise or fall depending on the volume of your sales is known as variable cost. This will include your inventory, packaging and shipping and sales commissions. To get a fair idea about your variable costs, you should talk to the vendors and the trade associations of your area. Sometimes other business owners in your industry can also help you get an approximate estimate.

• Selling / Average price – This is where market research comes in. You should study the price of your competitors before you fix the price of your product. “You can look at pricing from many different ways. How’s your competition pricing it? Do you want to be at the midpoint, higher end, or lower end? I see people pricing earrings at three times what their competitors are charging. Why would anyone buy that?” says Gwendolyn Wright, a small business coach with The Wright Consultants in San Francisco.

Break-even analysis will help small business owners and marketing managers compare the various cost structures and prices before making their business plans and marketing strategies. Using this relevant information, you can lower the fixed cost, pull out the product from the market or spend more to revamp your advertisements and marketing techniques.

“Price is what you pay. Value is what you get.” – Warren Buffet

In the current economic scenario, small businesses and startups would welcome any financial help they can get. Once they have tapped funds from their friends and family, they may turn to investors who are willing to invest in their business. However, one must keep in mind that investors don’t write blank checks. They will want a detailed business plan and also a way to exit from the business down the line with meaningful profits. You should be thoughtful in your approach towards potential investors because a scattershot approach will turn them off. A point worth mentioning is, never ever lie to a potential investor.

Why you should not Lie to a Potential Investor

• Investors prefer to deal with realistic SMB owners – To get the funding, many entrepreneurs tend to lie and give an unrealistic projection. A shrewd investor would likely see through the flaws and would realize that you have not done your homework because you are too optimistic about the idea of ever failing.

• Give a true and clear picture about the market – Investors would like to know that you have analyzed the market and are keeping a close watch on what the market analysts have to say about the current market scenario. Therefore, you have to explain to investors why you think this market is likely to grow. Any investor would prefer to hear your opinion and feel your optimism and confidence in your pitch.

• Never hype your sales effort – It is always better to give a clear picture to your clients. You can talk about marketing strategies that you wish to implement in the near future to increase your sales. Always explain to them your sales funnel and let them know what you intend to do. It will not hurt to disclose your actual revenue and contracts you have in hand.

• Acknowledge your competitors – Indicate to your investors that there is likely competition in your niche area. You should also discuss your strategies to tackle the competition. This will give them confidence to invest in your business.

• Do not boast about your management team – You should always appreciate the work put forth by your team. However, ensure to never talk to highly about your team or else venture capitalists will think what do you need the funding for if you have such a great team?

• Do not hesitate to ask the investors about their overall strategy – Keep in mind that your potential investor is assessing your capability and also the assets of your business. Similarly, you can also ask them what they are looking for in a company and in what proportion do they wish to work with you. Many investors will appreciate the interest that you show in the way they work.

When you lie to your investors it is proof that you are being unrealistic and that you are not willing to look beyond a certain horizon. It will also show them that you lack the experience to succeed. When you are pitching your business to potential investors, always assume that they have heard what you plan to tell them number of times before. Therefore, instead of lying, tell them about the alternatives that will eventually help to increase your sales and bring in profits.

“Nothing splendid has ever been achieved except by those who dared believe that something inside them was superior to circumstance.” – Bruce Barton (American Author and Politician)

If you want to put in place an effective retention strategy, it is mandatory that you do something to boost your employee’s morale. It is a fact that if the morale is poor and if your employees dread coming to work, they are unlikely to stick around for long. This in turn will reduce the productivity and the profits of your organization. With the economic slowdown, many small business owners are not able to give a raise to their employees; instead there is a hike in their responsibilities. The morale of the employees will hit the bottom when such a situation arises. As a small business owner, what steps can you take to boost the moral of your employees?

How can you Improve Employee Morale in your Organization

• Listen to your employees – When you notice that the productivity of the organization is showing a downward slope, do not hesitate to talk to your staff. When the owner of the firm takes some time to speak with his employees, it will make them feel that they have someone who will listen to their woes. “Acknowledge the stresses and circumstances that your employees are feeling,” says Arlene Vernon, president of HRx Inc, an Eden Prairie, Minn.-based HR consultancy. This is an important way to improve the morale of your employees. When you chat with your staff, you will get the gist of the problems they are facing, whether it’s if they are happy with their job to the training required.

• Appreciate and celebrate their achievements and accomplishments – Appreciating an employee when he accomplishes something is a number one motivator. When your employees put in the extra effort to go an extra mile to accomplish the task, be graceful enough to appreciate them and arrange a small celebration. A raise in salary is not all that matters, small events such as appreciation and celebration shows that you care for them.

• Make time for one-on-one conversations – Whether it is a recession or not, it is advisable that business owners have a one-on-one chat with its staff. This will help you understand the needs of your employees. Many owners are reluctant to do this because they fear they will not be able to satisfy their employees. One-on-one conversations are also important when an employee wishes to leave the company. An honest discussion before he or she leaves will give you an understanding to why he or she is quitting. You can use this knowledge to prevent other staff members from quitting.

• Avoid employee burnouts – Do not overload your employees with too much work. One of the problems faced by many small firms is that when one of the employees leave, his work is handed over to his co-workers. The boss or manager doesn’t even bother to find out whether the other person is able to do the work or not. This will lead to a certain degree of job dissatisfaction. Therefore, the quality and productivity of work will decrease. Owners instead should step up and find out the whether a particular job description will fit a particular employee before handing him the task. “Evaluate your expectations so you’re not burning out your employees — and at the same time not compensating them for it,” says Arlene Vernon.

• Do not forget to have fun – To break the monotony of work, encourage team building exercises and other games once in a while. Organize a potluck party on the last working day of the week once a month. Many employees love the idea of showcasing their cooking skills. Think about arranging a get together on holiday’s or ask your employees to work at a charitable event and later take them out for lunch or dinner. This is one way to create a bond between you and your employees.

• Allow the employees to pursue the project they’re passionate about – Grant your employees with a project they would be passionate about. This will surely energize and boost the morale of any employee. You can set fixed hours on certain days where an employee can work on his personal project and at the end of the month they can showcase their project(s) in a presentation.

• Arrange for training and development programs – One of the reasons many employees leave a firm is due to inadequate professional training and lack of development. You can arrange for training sessions with experts and seasoned veterans once in a while. Another way to boost the employee morale is pay the employee to attend a local trade conference.

• Give small perks – Perks need not always be monetary. Giving your employees the provisions to work from home a couple of times a month or giving them flexible times will have a big personal impact. Instead of giving a $100 bonus, arrange for a fine dinner for your employee and his significant other at a local restaurant. This would be well appreciated and something for him to brag about.

An employer has to be transparent and keep his staff in the loop. This will give them an idea about what’s happening in their firm. Genuine interest and concern for your employees will increase the productivity and profits of your business.

Flickr image by Forest Service – Northern Region

Social media channels are a wonderful platform for networking, exposure, branding and to attracting traffic to your website. A well planned social media campaign will give an edge over your competitors. Are small businesses or online businesses using social media correctly?  We have put together a few useful tips to help small business owners use social media effectively to reap success.

Effective ways to Use Social Media

• Put together a social media marketing strategy – If you wish to make social media work for your business, keep aside a certain amount of time to plan social media marketing. Many SMBs dive into social media with little or no strategy at all. What usually happens here is that they tend to spam their users and don’t know how to create brand awareness. When they end up getting no response, they lose interest and finally conclude it was a failure.  The success of using social media is determined by a strong marketing strategy to engage your visitors in the content you have published.

• Be where your target audience are – Spend some time finding out the sites where your target audience spend their time. This will give you firsthand knowledge about where you should post your blogs and make regular updates. Creating awareness is a way of brand building and lead generation.

• Do not ignore the social aspect of sharing – Search engine rankings depend on social signals, i.e. a link that is shared more times will be ranked higher in search engines. In social media it is not about you alone; you have to return the favor by sharing the link of your followers and they will reciprocate the action. If you are not willing to share the work of others, do not expect your work to be shared. Remember that social media is all about building and maintaining good relationships.

• Talk less, listen more – The aim of having an account in social media is to create brand awareness and expose you products and services subtly. This is a great platform to exhibit your knowledge and expertise of your niche area. When you have a good fan base, it is always better to keep them engaged. Here you can give them tips, suggestions and insights into the goods and services that you deal with. Do not forget to answer their queries and clarify their doubts. When you post something useful and interesting, it goes without saying that you will have the most captive audiences who could be your potential customers in the near future.

• Do not relay heavily on social networking automation tools – Keep in mind that social media followers are not dumb. It is a fact that social media is a platform to showcase your business and your area of expertise. However, if your blogs and posting do not have a human touch, then the followers will understand that it is automated. Eventually, they will tune you out.

• Analyze your social media efforts – It is not just about being on the latest social platforms, it’s important to listen and share great content. You need to take time out to evaluate how much traffic is being generated. You must understand the preferences of the followers of the various social sites and strategize accordingly. You can use that data to generate leads.

Social media marketing is the latest marketing trend. It is here to stay, so it is wise to make use of this because it is very cost-effective, generates new business leads, builds loyalty and is a great platform to share information and connect with people globally.

How are you using social media?

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