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Retailers

2009-07-29T00:09:00.001+07:00

Retailers are the businesses that sell to final consumers. Providing individuals with the goods and services they use in their daily lives, these are the places where people go when they need or want something, be it food, clothing, personal care and household items, a task performed, or some other purchase. If you have products that are sold by retailers then you need to determine which retailers you want to use. If you’re a retailer yourself then you should know how your business compares with other retailers and the ones that complement or compete with you.

Encompassing a broad array of formats, retailers include general merchandise and department stores, specialty shops, discount stores and warehouse clubs, drugstores, supermarkets and convenience stores. Restaurants and hotels are retailers. So are service providers, such as beauty salons, automobile repair shops and real estate offices. Retailers can have a physical location or sell online from an electronic one (e-tailers) or by phone or catalog. The smallest retailers are kiosks, stands, and vending machines. The largest are big box stores that take up the better part of a city block.

Variable Expenses

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Variable expenses are an important consideration when you're trying to identify what additional income must be brought in to reach your objectives. These are the expenses that increase or decrease with the ebb and flow of revenue. When identifying the target amount that you need to earn, ask yourself what you'll have to spend to generate this additional revenue. Obvious examples might be supplies, the cost of goods sold, shipping costs, sales commissions, promotional expenses, or additional manufacturing costs depending on the type of business you are in. You might simply know off the top of your head what expenses are variable.

If you need a reference source to make sure you've identified all variable expenses, we'd recommend looking at your Profit and Loss Statements. Typically, your accountant, as part of your annual financial statements, prepares Profit and Loss Statements. Identifying what expenses increased or decreased other than normal inflationary increments with a corresponding increase or decrease in that gross revenue number will help you identify all your variable costs

Uploading your cool video

2009-07-17T12:19:00.000+07:00

When you visit YouTube for the first time, May be you wondering what all the hubbub is about. YouTube isn’t a particularly cool-looking site, which in a way is a good thing. After all, the coolness is in the important content, not the interface. Nevertheless, you have to be able to find what you want quickly, which is the hallmark of any good Web design. The YouTube Web site looks inviting enough.

YouTube invites to upload your videos on every page of the site. If you’re a registered user and click the Upload Video button, you can upload a video. However, if you don’t have a YouTube account and click the button, you’re presented with a simple form to fill out, which makes you an official Tuber. After you’re an official Tuber, you get to enjoy all the benefits of the YouTube Web site and become a part of the YouTube community.

When you begin uploading your videos and other Tubers take notice, you’ll probably get some subscribers to your channel. You may also get requests to add the other Tuber’s Friends list. If you’re really lucky, you may get some Tuber groupies. Just don’t let your significant other know.

Fire Insurance

2009-07-09T19:26:00.001+07:00

In a standard fire-insurance policy, your building, the property contained within it, and property temporarily removed from it because of fire are protected against damage inflicted by fire or lightning. This coverage does not extend to accounting records, bills, deeds, money, securities, or manuscripts. Nor are you protected against such hazards as windstorms, hail, smoke, explosions, vandalism, automatic sprinkler leakage, and malicious mischief. To guard excluded valuables and protect yourself against loss from these hazards, you must obtain additional coverage. Neither fire resulting from war nor actions taken under the orders of a civil authority are covered by insurance.

Most fire-insurance policies are written for a three-year period, and both you and the insurer have the right to cancel. You may cancel your policy at any time. The insurer, however, must give you five days’ notice before canceling. In either event, you will be reimbursed for any premiums that have been paid in advance. If you are the one to cancel, however, a penalty as set forth in your policy may be assessed
against your refund. To keep your fire-insurance policy valid, it’s your responsibility to use all reasonable means to protect the insured property both before and after a fire. Should it become necessary for you to file an insurance claim, you will be required to provide the insurance company with a complete inventory list, detailing the types, quantities, and values of the damaged property.

Personal Insurance

2009-06-18T05:36:00.001+07:00

Just as there’s a need to insure your property against loss, there’s an equal need to insure both yourself and your employees. Group health and life insurance, a retirement plan, and key personnel insurance all to do this. The need for these may seem a long way off, but more and more small businesses are offering an employee benefits package that includes health and life insurance as a way of retaining valued personnel. If you decide to incorporate a retirement plan, too, there’s another advantage. Contributions made to the plan for yourself and your employees are deductible from your federal income tax.

Key personnel insurance, long a staple in the insurance portfolio of major corporations, can be just as necessary for the small business owner. key personnel insurance can at least ease the loss. The proceeds from the insurance are exempt from income tax and payable directly to the business. The policy itself has a cash value and may be used as loan collateral.

Business Interruption Insurance

2009-06-18T05:34:00.001+07:00

Many business owners fail to purchase business-interruption insurance because they don’t think they need it. If a building burns down, they think a standard fire insurance policy will suffice. But the loss of business income during the months it takes to rebuild or about the expenses that continue to mount up even though your doors are closed, taxes, interest on loans, salaries, rent, utilities is maybe out of
your plan. You must realize that an fire insurance alone isn’t enough.

Only business-interruption insurance covers your fixed expenses and expected profits during the time your business is closed down. Also, make sure that the policy is written to provide coverage in the event that your business isn’t totally shut down but is seriously disrupted. Some policies pay off only in the event of a total shutdown. You should also remember that an indirect peril could force you to suspend
operations as well. Protection against these hazards can be written into your business-interruption policy, but you have to ask for it.

Personal Selling

2009-06-18T05:31:00.003+07:00

Personal selling involves more than just giving a sales presentation and writing up the order. Today’s top salespeople whom the kind you want to be or to have in your business are problem solvers. Equally good at listening as talking, they are able to correctly identify customers’ needs and match them to the products or services they sell. Rather than assuming what customers want or pushing the products they
want to sell, the best salespeople find out what customers do want and then show them how they can have it. Like any skill, personal selling entails a set of steps that leads to a successful outcome in this case, a satisfied customer. As shown
here, there are six steps in the selling process. What you and your salespeople do at each step will directly affect your ability to make individual sales, to get repeat sales and referrals, and to build a positive image.

Many sales experts consider this to be the most important step in the selling process the search for potential customers, to you can sell your products or services. In developing a list of prospects through customer referrals, contacts, market research, mailing lists, and so on, your goal is to focus your attention on those who can be considered good prospects. Whether you do prospecting alone or you
involve salespeople as well, it must be done. Good prospects are the lifeblood of any business. To expand your customer base and raise sales revenues, you need to actively seek out new customers.

Promotional Strategy

2009-06-18T05:27:00.001+07:00

Forming a business is much the same as inventing a new product. To succeed, each needs to be promoted. You also have a pretty good idea who your potential customers are. Knowing this much is half the battle. Now, what’s left is to convert those potential customers into satisfied customers. That’s where your promotional strategy comes in.

A promotional strategy is a game plan for reaching your target market, those people most likely to use your product or service. At the simplest, most direct level, your promotional strategy might consist of relying on a sign in front of your door and the word-of-mouth comments of your present customers. In some instances, if you’re in a very small town, or if you offer unique products or services, or if you have a long-standing reputation, for example, this tactic is sufficient. Normally, though, customers need more to go on before they are drawn to your business. The goal of your promotional strategy should be to reach the greatest number of potential customers through the most economical use of your resources. This entails using
advertising and publicity to tune in to those channels of communication most widely used by your target customers. It also involves working within the limits of a budget to achieve the desired results. In this chapter, we first discuss the various media through which you can advertise your business and then the ways you can use
publicity to promote your business.

Developing a Corporate Culture

2009-06-18T05:25:00.002+07:00

At the same time that you are building your business, you must also be developing its corporate culture, the combination of values, ethical standards, beliefs, and attitudes that the business strives to uphold. Despite the name, it isn’t necessary to be a corporation to have a corporate culture. Every business has one whether the people in the business realize it or not. A good corporate culture inspires employees, guides their efforts, and unifies their actions. A bad corporate culture creates dissension and leads to employee apathy and poor customer service.

Your corporate culture is critical because it provides a framework showing employees which actions and behaviors will be rewarded and which ones won’t. Though often difficult to define or describe, corporate cultures are easily recognized in the way that businesses conduct themselves, how they treat their employees and customers, their product offerings and promotions, and even such minute details as how the telephones are answered and the assignment of office and parking spaces.

Autocratic Management and Democratic Management

2009-06-18T05:22:00.002+07:00

Business owners who use an autocratic management style keep most of the authority to themselves, making decisions without consulting others. More inclined to give orders than to seek advice, they generally adopt a take-charge approach to management. When the situation calls for fast, decisive action, they are ready to move. The autocratic management style works best in fast-paced, volatile industries where there isn’t time to confer with others and in situations where employees lack experience or motivation. The drawback to this style is that it can generate resentment and frustration among workers who feel that their input is being ignored. Furthermore, by making all the decisions alone, entrepreneurs can end up limiting
their businesses growth potential by failing to develop the employee management talent needed to run a larger operation.

A democratic management style gives employees a much greater say in decision making. Rather than making unilateral decisions and expecting employees to carry them out, the democratic entrepreneur encourages employees to get involved in the process. Business owners who take a participative approach to managing delegate authority whenever possible but retain the final right to approval. The democratic management style works best with employees who have strong job skills and require only minimal supervision. Among its advantages are the feelings of belonging, pride, and commitment it can instill in workers and its ability to tap employees’ ideas and ingenuity for the good of the business. The main disadvantages of this management style are the time it takes to get employees’ input and the weakening or watering
down of decisions that can occur in reaching consensus. Inspiration, you may be surprised at how many different businesses appeal to you.

Setting the Price

2009-06-18T05:19:00.002+07:00

In setting the prices for your products and services, among the facts to be considered are the reactions of your customers, the stiffness of the competition, and the state of the economy. Strange as it may seem, a price that’s too low can be just as much of a turnoff to customers as a price that’s too high. Low prices are often interpreted as signifying low value or inferior merchandise. As for the competition, because your business doesn’t exist in a vacuum, you must recognize
the role of the other businesses in influencing your prices. You may decide to go head-to-head with competitors on prices, matching them dollar for dollar, or to undercut them, or to charge higher prices. The strategy you choose is crucial to your pricing. Take care also not to overlook the state of the economy. Unemployment, inflation, interest rates, government policies, and levels of investment all have
an effect on consumer spending and therefore on your prices.

You must also consider another factor, the profit. If your prices are so low that they fail to cover your expenses, or so high that an insufficient number of people want to buy from you, the result is a loss of profits. Your goal is to meet the demands of customers, keep an eye on competitors and the economy, and assure yourself of satisfactory profits.

Elasticity price

2009-06-18T05:15:00.001+07:00

The first thing you need to find out is how responsive your market is to a change in price. This responsiveness is called elasticity. Products such as eggs, baking soda, razor blades, and medicine are highly inelastic. Regardless of whether their prices are raised or lowered, customers continue to purchase them in approximately the same
quantities. Customer demand for some products, on the other hand, fluctuates with the price. A small change in price up or down, results in a decrease or increase in the number of units sold. This type of response is said to be elastic. For example, television sets, strawberries, clothing, and jewelry are highly elastic. As a rule,
items considered to be necessities are less elastic than those considered to be luxuries. This is because the customer’s need, rather than the product’s price, triggers the purchase of necessities.

For instance, a person with a headache doesn’t wait until aspirin is on sale before buying it. The need to get rid of the headache takes priority over the price. For one thing, the more inelastic your product is, the easier it is to raise your prices without hurting your sales. That means greater profits on the same volume. To increase your profits on highly elastic products, rather than raising your prices,
you might try lowering them. Although this reduces your profit on each unit sold, the resultant increase in sales volume should increase your overall profits.

Pricing and the Economy

2009-06-18T05:00:00.001+07:00

Customer shopping habits reflect the state of the economy. During a recession or depression, customers are at their most price conscious. Worried about the high cost of living, threats of unemployment, and cutbacks in credit, they want to make every dollar count. As the economy improves, customers become more optimistic about the future and are more willing to pay higher prices. When the economy is at its peak and business is booming, customers offer little resistance to rising prices. The general feeling is that there’s more money where that came from.

As a business owner, your ability to recognize these fluctuations in the economy and to adjust your prices accordingly adds to your competitiveness. To keep your prices in line with customers’ expectations, you may add or drop products and services, raise or
lower quality standards, change your markups, or put together some combination of these.