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2012

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by Iris Dorbian. 

 

Sometimes the best small business partnerships can be fortuitous, born in ways that have nothing, at least, outright, to do with commerce. For Matt Forsman, a San Francisco-based running coach, that was the case. As owner of Marathon Matt, a coaching program he launched in 2005, his company’s fruitful partnership with the nearby PSOAS Massage/Bodywork, a massage clinic, had nothing to do with instigating huge profit margins. Says Forsman: “I engaged them primarily to provide some stretching clinics for my runners.” 

 

The affiliation has become a positive community mainstay that has benefited both operations. Marathon Matt’s clients, who Forsman says have quadrupled from 30 to 40 per year to between 150 and 200, are referred to PSOAS, which as a courtesy, extends a 20-percent discount to Forsman’s customers. “They've told me I generate more business for them than any other training organization or club in the San Francisco Bay Area,” says Forsman. 

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In addition to providing discounts to Marathon Matt’s clientele, PSOAS reciprocates their end of the deal by promoting their partner’s programs via e-mail newsletters and in other collateral pieces posted in their neighborhood. They also co-sponsor the shirts Forsman provides runners in his programs.  

 

Though the ROI is hard to quantify in terms of dollars and cents, according to Forsman, each party in this symbiotic pairing has reaped enormous dividends nonetheless: Marathon Matt gets increased visibility through PSOAS’s promotional efforts, while the latter enjoys a larger customer base as a direct result of the relationship.

 

In other words, both companies get the best of all possible worlds. So, for small business owners looking to broaden their reach and attract more consumers, what are some best practices to find the right fit for a such a symbiotic relationship? 

 

Seek out related businesses  

If you’re seeking to carve a niche in your community or seize a healthy market share of your specific sector, then working in tandem with a rival business would probably not be a savvy business move (unless of course, you’re planning on buying that business and taking ownership of the existing clientele). However, if you team up with a business that can complement your own while filling a void (such combining a caterer with a wedding planner), then it could be the makings of a win-win situation.  

 

This is a key lesson learned for Jane Coloccia Teixeira, president of JC Communications LLC, a small Pennington, New Jersey-based PR and marketing communications for the hospitality industry. “I have friends who have complementary businesses and we have teamed up so that we can go out and offer a complete resource for potential new clients,” she explains. “My graphic design-agency friends tell their clients they have someone who can do copywriting so I get the work and then I can tell a prospective client I have [about] someone who can do web design or ads so my other friends get work.” 

 

Find a company whose marketing and messaging mesh with your own 

Justin Lee, a co-founder of TheSquareFoot, a commercial real estate leasing firm in Houston, Texas, which targets small to medium-sized businesses, says a prime takeaway to widening his customer base is to leverage the networks of other small businesses that also serve his market. Because TheSquareFoot has been in operation for only 18 months, Lee and his small staff know efforts to promote their nascent company would only take them so far. 

 

After admiring from afar the marketing and social media campaigns of Bounce Energy, a Texas-based electric company that focuses on smaller commercial users, Lee contacted their marketing directors via LinkedIn to broach a possible partnership.  

 

“They loved our platform and our vision,” says Lee. “And they certainly saw the parallels between our two business models and who the target customer was. [As part of the exchange], we did things like trade blog posts [on our respective company’s sites] pertaining to commercial lease language about energy consumption and how to be more energy efficient at work.  We have leveraged all of the small businesses who are part of their network and have let them know the value we provide.” The strategy has resulted in a surge of leads for TheSquareFoot.  

 

Think of the synergistic value a partnership can provide to customers 

This idea may sound counterintuitive, but if you place a higher premium on offering quality service to customers as opposed to brainstorming a “what’s in it for me?” scenario, then profit is inevitable, says Jeremy Fitzgerald, owner and operator of Bar 145, a restaurant in Toledo, Ohio.  

 

To promote culinary arts in the city, Bar 145 invites guest chefs from other restaurants for their "Pinot on the Patio" events on Tuesday evenings. The guest chef partners with Bar 145's chef to mix up the weekly specials, which go beyond the menu’s traditional dishes. Fitzgerald and his partners feel that cross-promoting local restaurants will help the restaurant business as a whole. They also utilize social media to promote the event, tagging the guest chef in posts to reach more people. Since starting this event, Fitzgerald says Bar 145’s sales have swelled up to 40 percent on Tuesday evenings, a typically slow night of the week.  

 

“Small businesses need to consider why they [want to team up with each other] first,” says Fitzgerald. “They should team up with others with the intention of helping the customer by filling a void or offering something original and unique. If this approach is taken when teaming up with other businesses, all parties involved will be successful and the overall customer bases will increase.” 

 

Pair up with reputable businesses  

Teaming up with a company that has a dubious reputation or offers shoddy services will only end up hurting the way your brand is perceived in the marketplace in the long run. Don’t do it. Make sure the company is your equivalent in service.  

 

“Look for quality rather than quantity,” says Forsman. “I'd much rather have five to six quality partners than 10 to 12 mediocre partners.” 

 

Don’t be afraid to negotiate specifics 

Be very clear on how the partnership with work, counsels Teixeira. “Will you pay them commission for work they forward to you or will they [want you to bill directly to a client]?” she asks. Make sure everything is spelled out before you shake hands and call it a deal.  

 

For small business owners seeking to broaden their customer base, pairing up with complementary companies might be an excellent move. But like a marriage, exercising caution and care is imperative before you proceed into an arrangement that may end up splitting prematurely due to irreconcilable differences.  

by Robert Lerose.

 

It doesn't matter whether you run a brick-and-mortar store or an online operation: To boost sales at the register, the process should begin from the moment a customer enters your establishment or visits your website.

 

White-in-article.jpgButWait_PQ.jpgFor retail stores, first impressions are especially important, beginning with the "decompression zone," the space where the customer makes the transition from the street or the concourse of a mall to the store itself—such as the 3' x 6' space inside the door where a mat might sit.

 

Because customers are in a period of adjustment from the outside world to the store's environment, this is not the time to aggressively sell or bombard them with messages.

 

However, there are things a business can do to facilitate this transition to its advantage.

 

"[The store] can change the texture under people's feet, which gets them to slow down faster. That's the reason why mats exist," says Paco Underhill, author of Why We Buy: The Science of Shopping. "It can manage sight lines. It can adjust lighting levels. It can also use some physical cueing as to where somebody slows down and what they see first."

 

How the customer reacts to the changing environment in these few seconds can influence their mindset for shopping. For instance, Underhill says that it's appropriate to greet customers, but it's a mistake to immediately ask if they need help, which could elicit a negative response.

 

Lead from the front

After studying the shopping habits of thousands of customers over the years, Underhill found that most stores work better with a counter-clockwise circulation pattern. One theory ascribes this to the fact that the majority of people are right-handed, (and thus are more apt to act on their right side) while another says it's due to the prevalence of driving on the right side of the road. Regardless of the direction, all stores should be clean and organized, he adds. Customer service, which should be highly visible and engaged, begins from the top down.

 

"I can't stress enough that a small business owner has to lead from the front," Underhill says. "He or she is providing leadership to the rest of the staff in terms of the level of customer service that's delivered. You need to remember one reason you wanted to be in retail is to have people-to-people contact."

 

One problem of modern life is the overabundance of options. Choice is good, but too much of it can lead to paralysis and lower sales.

 

Underhill's research has found that selling five great things at checkout is too distracting for consumers, whereas two great things are appropriate. For example, you could offer a basic package that whets the consumer's interest, and then push a well-accessorized luxury package.

 

Also, every store should change the items they merchandise at checkout on a regular basis, depending on the number of consumer visits, according to Underhill.

 

"If I'm a small local independent drug store, I may want to change out every two weeks. If I'm a local wireless store, maybe I do it every month. If I'm a local convenience store, I might even do it daily, based on the kind of road I'm sitting next to," Underhill explains. "If you think about a small convenience store in a rural setting, where you may see the same customer more than once a day, having some subtle changes in the register offerings is part of what brings a level of freshness to it."

 

Focus on core strengths

It's natural to want to push ancillary products or do cross-selling at the start of a buying relationship, but some businesses achieve better results by waiting and growing their operation first.

 

Take SurePayroll, an online payroll service for small businesses. Today, it offers a number of products and services in addition to its main payroll business. But SurePayroll held off from adding those products and services for the first three or four years of the company's existence until it had a larger customer base and could spend the additional resources and energy to go after their existing clients.

 

It comes down to focus.

 

"You can't have an online payroll service unless you're online, so I could potentially sell you website hosting services because I'm an online service," says Michael Alter, president and CEO of SurePayroll. "But my customers aren't likely to buy that from me. It's not a natural thing for a payroll company to sell. So you've got to make sure there's a true natural linkage, not a linkage just because you can make money in it."

 

According to Alter, SurePayroll has added more than 35,000 small businesses to its customer base since being founded in 2000. It uses live sales reps and encourages them, through incentives, to generate cross-leads for other sales forces in the company. They're trained to use a variety of tools to find out where a customer is open to buying something new.

 

"Certainly asking them what else they need is clearly an opportunity," Alter says. "Some of it is trial and error. If it's a logical add-on, they're more likely to buy it from you than to add another vendor to their mix."

 

Businesses that run an automated e-commerce site, such as Amazon, can also use technology to upsell by offering special offers or showing other products purchased by customers with similar tastes.

 

Investing in lifetime value

At a time when independent stores are under serious threat from the larger chains, Zane's Cycles in Branford, Connecticut makes sure that customers are greeted when they walk in and has employees float around the store in plain sight—paving the way to healthy sales and enduring loyalty.

 

"My average sale when I first started 20 years ago was $250 to $300. Now, I'm guessing it's got to be in the $700 to $800 range," says Tom Girard, director of retail operations. "I just sold a $14,000 bike. You can buy a BMW motorcycle for that."

 

A 14-foot copper-top coffee bar and a new section with clothing, bikes and accessories specifically for women reinforce the store's helpful, family friendly vibration. 

 

Founded in 1981 by current owner Chris Zane, the eponymous store has pioneered policies and procedures that result in a sale and a pleasant, enjoyable experience for the customer.

 

For example, they offer a lifetime warranty on each bike and its parts that exceeds the manufacturer's limited terms. They also guarantee the lowest price in the state for 90 days after purchase. And, customers have 30 days to test a bike without risk. If they're dissatisfied for any reason, Zane's will take it back unconditionally and give them full credit towards another bike.

 

"There's truly no reason why you shouldn't buy a bike from us," Girard says. "We kind of analyze the customer in a short five minutes, what kind of ride [they want], and what they're going to be doing. Then we figure out how to guide them through what's going to make them comfortable. You want to make it as pleasurable as possible for them."

 

Zane's policy of servicing any bike it sells for free for as long as the customer owns it—a $75 value every time a bike is brought in for a tune-up—enriches the customer experience and also doubles as a shrewd strategy for igniting foot traffic.

 

"They have to bring the bike in, so they have to walk through the store. They have to then come back and pick the bike up when it's done. I get them in the store twice to look at all the new stuff by offering free service," Girard explains.

 

"It doesn't matter if [we] spend an hour [with a customer] on a three-dollar [purchase]," Girard says. "If we made that guy's or that woman's day easier, they're going to come back to us and they're going to buy something from us. Whether it be big or small, a bunch of small transactions add up. But there's always a big one in there, if you think of the lifetime value of a customer."

Body_SellingNotSales.jpgBy Iris Dorbian.

 

It’s hard to escape their unblinking notice the moment you enter their lair and become prey. Like a heat-seeking missile, they make a desperate beeline for you, refusing to retreat even after you tell them point-blank that you’re not interested. From the opaque gleams in their steely eyes, the fixed, taut smiles that exude creepiness rather than genuine assistance, and the rote sales pitches, they never take no for an answer.

 

No doubt you’ve encountered this unedifying species—the pushy salesperson—while browsing through a store or perhaps picking up your cell phone sans checking the caller ID. Their sales tactics are annoying as they are aggressive. But how can you, as a small business owner, avoid having your staff act like a battalion of dollar-hungry, bottom-line-obsessed automatons every time they’re in the company of a prospect? What are some takeaways that will help build and maintain a healthy customer base without incurring undue alienation?

 

PQ_SellingNotSales.jpgDon’t compromise your standards

Kelsey Meyer, senior vice president of the year-old Digital Talent Agents, which helps clients get published online to improve their branding, says many firms, particularly her own startup, are guilty of employing desperate sales tactics when seeking to sign a coveted client. She cites a recent example in which her company signed a “high maintenance” client and charged her 30 percent of what Digital Talent Agents normally charges just because they wanted to sign her on.

 

In hindsight, says Meyer, it was not the best decision, but she did it anyway because she felt that, at the time, her company was at the stage where it needed clients.

 

“We quickly learned that giving huge discounts right away and changing processes and billing standards for people because we were scared they wouldn’t sign on, not only made us look desperate but could kill our company,” explains Meyer whose company currently has 24 people on staff.

 

Now Digital Talent Agents has become more selective when it comes to signing clients and as a result, says Meyer, they have become more successful. “When clients feel that you are interviewing them as much as they are interviewing you,” she says, “it's a more mutually respectful relationship and leads to more sales and better sales.”

 

Build the relationship with the prospect first before the sale

Rather than treat your clients or prospective customers as disembodied dollar signs, view them as people with whom you can cultivate and foster a productive, long-term business relationship.

 

Kent Wakely, managing partner of Fruition Interactive, a digital marketing agency founded in 2001 that has a staff of 22 (which includes part-timers), subscribes to this tenet when dealing with both clients and prospects. Although he concedes that his company was fairly aggressive early on in its client acquisition tactics—by pitching their solutions and services from the get-go—he and his colleagues later felt they might have better success if they employed a different strategy.

 

“So now we've put in place a process that is a little bit longer,” he says. “This incorporates several stages where we progressively commit more resources to a sale over the life of the process and that focuses mainly on educating and building trust with the prospect. We don't actually start to have a sales conversation as part of the sales process until after our third ‘date.’”

 

The benefits from this slow but steady sales approach have been enormous, says Wakely.

“Our cost per sale is down,” he notes. “We spend less time and money talking to prospects who we weren’t able to start building a trusting relationship with or weren’t a great fit for us because we're able to disqualify them earlier in the process.”

 

Also, because Fruition Interactive, which works with mostly small to mid-sized clients (although it has clocked in hours with well known brands like Home Depot and Bacardi) now invests time in building relationships, it more easily earns their trust. As a result, clients are now more likely to act on the agency’s advice and bring more of their business to the company long-term. 

 

“To use a dating metaphor, yeah, you can probably have a one-night stand by using a quick pick-up line,” he quips. “But you build long-term relationships by having more open, two-way conversations.”

 

Ease up on pressuring clients

Some sales people freely admit that when faced with imminent deadlines, they have often pressured clients for a response. But often that might not be the smartest strategy to utilize, particularly when dealing with a tentative prospect.

 

Lori Karpman, founder and CEO of Lori Karpman & Associates Ltd, a 10-year-old management consulting and law practice that caters to small businesses, agrees. She recalls encountering problems with clients when she has pushed them into a commitment by saying they needed to give her an answer sooner rather than later due to time constraints. 

 

“While the fact is usually true that because I have a small firm, I can only take on so much business, most prospects feel pressured by that tactic,” she maintains. “They say no right away, or completely ignore my deadline. In either case, I have boxed myself into a corner and it’s very hard to go back to them after the deadline to re-open negotiations. I have done it but by then I lose some credibility.”

 

Now Karpman’s solution is to tell clients that because she’s a small firm they need to give her a reply quickly because she is currently handling other projects and is pressed for time. “This way seems less pushy and they are happy to oblige,” she says.

 

Be confident in what you’re selling

This may sound like an obvious takeaway, but it is a basic sales precept that should never be given short shrift.

 

"If you know what you're offering adds value,” advises Meyer, “you won't come off desperate and you won't need to discount your product or services down 50 percent just to get somebody to sign on.”

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