Thursday, November 15, 2007

Marketing Your Business: is it time for you to go on-line?

This article was written by Ben McCulloch, SCORE Orange County Vice Chairman

Measured by what’s being spent, it seems like everyone is doing it. Spending on on-line advertising has surged 60% to nearly $10 billion, while ‘off-line’ advertising is decreasing (according to Fortune Small Business, July 1, 2007). If you don’t already have a ‘web presence’, should you? And, if you do, is what you’re spending resulting in higher sales?

The lure – the web’s potential reach and impact – seems clear: the e-marketplace is as much local as it is worldwide, and it’s ‘always on’. As with any marketing activity, your e-marketing goal is to satisfy a customer’s need. Though this medium may be different, your first challenge is their awareness that you exist.

Can you even be found?

Awareness begins with presence which, of course, requires a website. But, the customer must be able to discover you without specifically looking for you. Using ‘off-line’ marketing tools, such as the yellow pages, the customer looks within given categories. You must choose which categories to be listed.

While fixed ‘yellow pages’ types of listings can be found on the web, most customers search using a web browser and a few key words. Instead of a fixed list, each customer defines the ‘category’ that makes the most sense to them; your challenge greatly increases: you must anticipate – and match – how your customers will describe their need. Clearly, your choice of the keywords that describe your website is of huge importance. A ‘match’ – even a partial one – between the customer’s keywords and yours means you can be found.

But, will you be noticed?

A web search of ‘web marketing’ using the popular search engine, Google, returns 402 million websites matching these keyword criteria; at ten results displayed per page, that’s a lot of pages to view. Studies show that web searchers, on average, do not look beyond the third page of results. If so, to be noticed, you need to be among the first 30 results. Page ‘ranking’ is a process totally controlled by the search engine, in this case, Google.

How search engines rank individual web sites is a well-guarded secret. However, it is widely believed that, among the possible ranking factors, the frequency that a web site is mentioned or linked-to by another web site is the most influential. The search engines determine these frequencies through continuous assessment of the entire web; as your site is increasingly mentioned or linked-to, your rank should rise. So, to stand out from among others whose keywords also match the customer’s, a high ‘page rank’ is crucial.

Will they look? More importantly, will they stay?

You’ve made the cut. Now you must convert a web searcher into a visitor by compelling the potential customer to click on your web site. Your original choice of web domain name plays a factor; obscure names may confuse the prospect and cause them to proceed to a site that is more recognizable.

The average visitor stays at a web site for just a few seconds before clicking the ‘back’ button. Getting visitors to stay at your web site longer involves your product and message, and how they are presented on your site. Once they have landed on your page, web site design – appearance and navigability – becomes a critical factor in keeping visitors aboard, and potentially converting them into customers.

A new set of tools to conquer a new marketplace

E-marketing involves new technologies, new unknowns, and new decisions to be made. Fortunately, strategies and tools have evolved to guide a credible web presence and monitor its effectiveness. Included are terms you may have already heard or seen: ‘natural (or organic) keyword search’, ‘paid keyword search’, ‘search engine optimization’, ‘pay-per-click’, and ‘web analytics’, for example.

If it is time for you to go on-line, or just to learn more about the strategies and tools that you can use, arrange a session with a SCORE counselor or attend one of our ‘Internet Marketing’ workshops. We hope to see you there, and to visit your site sometime soon.

The Lease Clause Worth Paying For

This article was written by Dick Ginnaty, CPA

For a lot of businesses the biggest dollar commitment made at the start of the business (and periodically thereafter) is the lease that is signed. A $1,500 per month lease for five years means you are making a $90,000 commitment usually guaranteed personally by the owners of the business. In my experience, the lease commitments are one of the biggest reasons for bankruptcy, and it may be avoidable if the lease clause and considerations described below get negotiated and included in the lease.

It is very, very difficult to feel absolutely secure when committing to a long term lease in the startup of a business. Too many things can happen that may make the leasing decision the wrong one. Owners can get sick and can’t continue with the business. The partnership breaks up. The nature of the business changes. The location’s traffic isn’t right. Spouses change jobs and locales. Divorce happens. Anyone of these events can make the lease a financial albatross.

What’s the solution? First, only commit to the least timeframe possible (get a two year lease with a three year option vs. a five year lease). Remember options don’t cost you but give you the right to continue in the space. Second, document the promises or assumptions made by the management company (i.e. the big anchor store will stay, or will move in, no competing store will be allowed to lease space in the building or center etc.). Third, negotiate a cap on all aspects of the rent (base rent, annual increases, common area charges, property tax increases etc) and finally, try to negotiate the inclusion of an escape clause.

An escape clause is a clause that says the lease will terminate early if certain pre-defined events happen. One event that can and does happen is death of the owner. Negotiate that the lease will end a set number of months after the event. There is nothing more tragic than the remaining family facing a long term lease obligation after the breadwinner is gone.

Be realistic in the negotiations. The landlord needs time to re-lease the space and it needs to be ready for renting before they can market the space. Having said that, it is hard to imagine that six months of rent (perhaps paid when the escape clause is exercised and the space is vacant and returned to leasable condition) would not be reasonable. To incentivize the landlord (or management company) to consider your requested clause, I would wait until all else is negotiated and agreed upon, to ask for the escape clause, and I would offer them a few cents more per month (or a reduction in the tenant improvement allowance) for the flexibility. The more events that would trigger the escape clause (i.e. the greater the flexibility on your part), the greater the incentives that will probably be required.

Always remember to calculate what you are offering. A reduction of the tenant allowance of $3,000 over a five year lease amounts to a 5 cent increase per month to the landlord on a 1,000 square foot lease.

Good luck and here’s hoping it “all adds up” for you.

(If there is any area in accounting or tax that you think needs to be addressed in this newsletter please e-mail Dick at and if it is of general interest, he will address it in future articles).

The Employee Retention Challenge

This article was written by Bern Lefson, SCORE Orange County Management Counselor

“I just lost my best performing employee and I don’t know why?” Does this question resonate with you; if so, join the many who struggle with this issue.

Companies spend a great deal of time and money recruiting and training employees, and the cost of replacing staff members lost through turnover is great. The monetary cost of replacing one employee is generally estimated to range from 50 percent to 200 percent of the annual salary for the position, and may even be higher in very specialized fields. Additionally, poor employee retention can have a negative impact on workplace productivity, job satisfaction, and overall morale.

In order to figure out how to improve employee retention, employers need to first identify the reasons for turnover. It’s important to realize that some turnover is inevitable. It’s natural for some employees to choose to pursue different career paths for a variety of different reasons. When turnover is excessive, however, employee retention problems may be a symptom of a larger problem that exists within the organization.

There are some common reasons why employees leave. One of the most common is feeling unappreciated. Managers who want to keep their best employees are well advised to recognize employees both for outstanding accomplishments and consistent, on-target performance. As is said time and again; “people don’t leave jobs, they leave supervisors.” Other common reasons include:

  • Concern regarding promotion opportunities.
  • Harassment concerns
  • Misunderstanding about job performance expectations
  • Personality conflicts among peers and/or supervisors
  • Perceived lack of appreciation for employee.
  • Supervisors in need of managerial training
  • Workforce morale problems

Some innovative benefits programs that are gaining favor in today’s workplace and can have a positive impact on retention include:

  • Flextime so that employees may better juggle the stresses between work and their life
  • Training opportunities so that employees feel appreciated and valued. This also aids in keeping employee skills current and marketable

Managers who recognize the importance of taking proactive steps toward keeping their best people motivated and satisfied can have a positive impact on employee retention. They can begin by evaluating their own management styles, and taking steps to make sure that all employees feel appreciated.

Additionally, managers focused on learning how to deal with turnover problems should encourage their companies to implement an exit interview program if one does not already exist. The results of exit interviews need to be evaluated on an ongoing basis, to identify patterns of organizational behavior that need to be corrected.

Getting Disaster Help from the SBA

What You Need to Know About Disaster Assistance

  • If you are a homeowner or renter, FEMA may refer you to SBA. SBA disaster loans are the primary source of money to pay for repair or replacement costs not fully covered by insurance or other compensation.
  • SBA offers low-interest disaster loans to homeowners, renters, businesses of all sizes and private non-profit organizations.
  • Homeowners may borrow up to $200,000 to repair or replace their primary residence.
  • Homeowners and renters may borrow up to $40,000 to replace personal property.
  • Businesses may borrow up to $1.5 million for any combination of property damage or economic injury.
  • SBA offers low-interest working capital loans (called Economic Injury Disaster Loans) to small businesses having difficulty meeting obligations as a result of the disaster.

What You Need To Do

  • Homeowners and renters must begin by registering with FEMA. If you haven’t already done so, call (800) 621-3362.
  • Homeowners and renters who receive a disaster loan application should complete and return it to SBA, even if they are not sure if they will need or want a loan. If SBA cannot approve your application, in most cases they refer you to FEMA’s Other Needs Assistance (ONA) program for possible additional assistance.
  • All businesses should register with FEMA.

Contact SBA

  • SBA representatives will be at all federal/state Disaster Recovery Centers (DRC). Call the SBA at (800) 659­2955 for information on DRC openings, hours of operation and locations.
  • Submit your completed application by visiting the SBA desk at any local Disaster Recovery Center (DRC), or by mailing it to: SBA, 14925 Kingsport Rd., Ft. Worth, TX 76155. For additional information visit our website at .