2007 December
An MLM, or Multi-Level Marketing, company works on a tier system, meaning that salespeople are enrolled to sell products and earn commissions from sales and from the sales of the people they enroll as salespeople in the company. Salespeople not only receive commissions from their sales and the sales of their recruits, but also their recruits’ recruits and so on (thusly, the "multi-levels").
MLMs have gotten a negative image over the years because they operate similar to a pyramid scheme, which is illegal in many countries. While pyramid schemes make their money by signing on recruits and requiring them to buy a large amount of products (most of which will never be sold), MLMs make their money on products sold to consumers. However, since most pyramid scheme companies bill themselves as MLMs, therein lies the confusion.
Successful MLM Companies
There’s no doubt you’ve heard of Avon and Tupperware. Both of those companies operate as MLMs. And both companies have created thousands and thousands of wealthy salespeople. Of course, there’s been even more salespeople who have walked away empty handed - except for a pile of unsold products. Other big MLM companies are Amway, Pampered Chef, and Longaberger Baskets, most of which operate by having their salespeople host "home parties" or asking friends to host parties, and giving them free products in return.
Even The Body Shop is getting into the MLM business. They recently started a "home party" division of their company that is set up in the exact same way as an MLM.
The Problem with MLMs
MLM salespeople survive because they are fantastic networkers. They don’t mind asking (or pressuring) their friends and family to host parties or buy products; but friendships can quickly become strained or awkward if a salesperson can’t "take a hint" that a friend isn’t interested. Most people are not cut out for the kind of intense socializing, networking and pressuring that being a successful MLM salesperson requires. In order to continually make money, you have to continually have parties and sign on more and more salespeople. The "sit back and watch the profits roll in" part comes way, way down the line - and, for most, it never comes.
Most, if not all, MLMs require their salespeople to purchase a "starter kit". In it is some of the products they’ll be selling or even demonstrating at the home parties. Typically these starter kits range in price from $100-$250.
Spotting an MLM
It’s fairly easy to spot an MLM business. Just ask yourself these simple questions: Do they sell their products at "home parties"? Do their salespeople try to recruit customers to be salespeople? If you answered yes to either of these, then it’s an MLM. Remember, MLMs thrive on salespeople, and they have a hard time resisting asking someone interested in their products to also become a salesperson.
There’s no doubt that being an MLM salesperson has worked for a good many people; but there is also a much, much greater number of people for whom it has not worked out. Knowing whether or not it will work for you means understanding exactly what is expected and deciding whether or not you feel comfortable in that role. You can also Google any company and find out what their past salespeople have to say about their experience.
Tags: advice, management, Marketing, MLMs, multi-level marketing, Tips
Posted on December 20th, 2007 in Marketing Your Business | No Comments »
With some creativity and a heap of old "junk", you could be well on your way to making millions. It’s true, new companies are continually popping up and offering products made from materials that were once deemed for the landfill. Not only is it trendy to be "green", but the best part about starting a recycled business is that most (or all) of the materials are free!
Today’s recycling geniuses at work:
1. MotherBoardGifts.com - They turn old motherboards into sleek products like business card holders, clocks, coasters and picture frames. For engineers and computer geeks, it’s the ultimate gift!
2. VyAndElle.com - These business owners did some serious creative thinking to come up with this idea. They take used billboards and recycle them into fashionable handbags and backpacks. And, yes, they look really cool too!
3. Vinylux.net - Who wants LP records anymore? Well, this company does! They fashion artistic bowls, jewelry, clocks and coasters out of them.
And that’s just a few ideas; there are literally hundreds (or perhaps thousands) of other entrepreneurs making lots of unique gifts out of a variety of used products. There’s furniture made out of seatbelts, bottle cap belts, license plate purses, glass bottle lights…the list goes on and on.
So, how can you start your own recycled products business?
There’s no doubt that creativity is key when dealing with recycled products, not only in thinking of the actual recycled products you want to make, but also in finding a way to get the materials before they get to the landfill!
For instance, let’s take used car and truck tires. Every year millions of tires wind up in landfills - taking up an enormous amount of space and just going to waste. But now, companies are beginning to realize that the rubber can be recycled and used again. When chopped up, they make a great springy mulch for playgrounds. Even homeowners are starting to realize that this recycled mulch makes sense for around the house too!
And what about all those wooden pallets? Those usually never get used again…they’re big and they just get hauled off to the dump. Could they be recycled into the "next big thing"? What about used holiday cards? Or old VCRs? Car radios? The list is literally endless because trash never ends.
The key is thinking of "trash" that you can easily get a hold of. A business idea of using worn Vera Wang shoes probably wouldn’t get you very far. But, taking the orange rind from an orange juice manufacturer might. Big companies throw out tons of trash each and every day, and some of it could very well be used to make other products - your products!
So start brainstorming, you could be just a few ideas away from your very own "trash to treasure" success story. Once you think you have a great idea be sure to check for it on Google - you want to be sure that there aren’t five other companies already doing the exact same thing! But if there are, don’t worry, there’s still a thousand other recycled product ideas waiting to be brought to life!
Tags: motherboardgifts.com, recycled products, start up, Starting a Business, vinylux.net, vyandelle.com
Posted on December 20th, 2007 in Starting a Business | No Comments »
MBAs (Masters in Business Administration) are one of the most popular degrees our country offers. But there is a lot of dissension amongst business people as to whether you actually need one to get ahead and/or to be successful. Numerous polls and surveys have been conducted on the subject, but unfortunately the results are usually skewed.
Graduates of the top business schools in the country say yes, an MBA is necessary but this could be seen as merely a recommendation for their alma mater. But in polls taken from less niche populations, the results are a little less black and white. Many say that while an MBA is a nice neat little package wrapped with a bow, everything you need to know to start and run your own business can be learned sans formal education.
So I suppose the bottom line would be that if you can afford the time, money and effort, an MBA is beneficial, but if times are lean, you can still succeed if you make a point to educate yourself.
What are your thoughts?
Tags: business resources, business schools, entrepreneurs, MBAs, Start ups
Posted on December 20th, 2007 in General Discussion | 1 Comment »
It’s easy to see why more and more business owners are showing an interest in importing, mainly from China. E-commerce is booming and all that competition means price wars, and importing goods in bulk allows companies to get big price breaks. Although, receiving those discounts means getting through the risks first.
As cynical as it may sound, the two biggest pieces of advice when importing are: trust no one and do your research! There have been too many horror stories of buyers losing money, getting fakes, damaged goods or never getting any shipment at all to think that something like that couldn’t happen to you. However, if you are smart and take all the necessary precautions, you can ensure that your importing experience goes smoothly.
Risks to Look Out For
Fraudulent company - Just because someone tells you their company is a "top exporter", manufactures products of the "highest quality" and sells to big companies, doesn’t mean they are telling you the truth. However, having the internet on your side makes fact and reference checking easy. To avoid being taken by a less-than-trustworthy company, you should take the following steps:
1) Do a thorough search on Google using the company’s name,
2) Go to wholesaler forums and ask if anyone has dealt with the company,
3) If they claim to do business with a large company, then call that company and find out if it’s in fact true,
4) Talk to the U.S. Embassy in that country and see if they have any records on that company. For China, the website is: http:// www.buyusa.gov/china/en/ .
Unreliable goods - Unfortunately this happens quite a bit. You are shown pictures of products and assured that they are made from certain materials and of the highest quality, etc. Then, when they show up at your warehouse, they are not exactly the same. You may have ordered leather products, and they may instead be a different color or perhaps vinyl or PU (Polyurethane) leather instead of real cow leather. In addition to taking the precautions listed previously, you should also: 1) Request a sample, 2) Make it clear to the overseas company that you expect the exact same goods you were shown and list out the product specifications in writing 3) Have them take several pictures of the merchandise as it is being manufactured and packed, and then email them to you. Companies who have been in business a long time or who have a good reputation are less likely to try to pull this on new customers.
Branded goods that are actually fakes - If you feel like you are getting a "too good to be true" price on iPods or Sony Playstations, then they are probably fakes. No matter how much the overseas company assures you they are the real thing. Even if they show you a picture and you are convinced it’s real - don’t be. Many times they’ll just email a picture of the real product or a fake that looks just like the real thing. Recently, Consumer Reports magazine printed pictures of fakes next to real merchandise and it was hard to tell the difference - everything from New Balance sneakers to iPods. If your retail store tries to pass counterfeit merchandise off as real, both you and your company will be in big trouble - it’s a federal crime! Learn how to tell the difference by checking out our 10 Golden Rules for spotting fake products .
Longer than expected lead times - Overseas companies are notorious for their long production and shipping times. If they tell you 30 days, expect it in 60 days. As long as you expect there will be delays, you’ll never be disappointed with a ship date that keeps getting extended.
Unexpected charges - Many buyers new to importing don’t realize that most of the prices given are FOB Hong Kong - meaning that the shipping charges to your warehouse are not included. There’s also customs fees, import taxes, etc. Do your research and figure out your actual cost of importing before you have placed your order with the factory or manufacturer. Otherwise, you will be in for a huge price shock!
As long as you take the time to do your own research (and plenty of it) you can avoid all of these risks. The problem most first-time importers have is believing everything they are told by overseas companies and not checking the statements for themselves. Now that you’re "in the know", it’s doubtful you’ll fall prey to any importing scheme!
Tags: china, doing business internationally, importing products, lowering risk, Tips
Posted on December 20th, 2007 in Uncategorized | No Comments »
With over 300 shopping cart companies to choose from, it’s no wonder why the owners of new e-commerce stores are having trouble deciding who to go with. If you first decide on either a licensed or hosted shopping cart, then at least you’ve cut that number in half. Then you can start whittling down the prospects based on price, features, compatibility, recommendations etc.
Let’s take a look at each of the types of shopping carts. There are advantages and disadvantages to both, depending on the needs of your company.
Licensed Shopping Carts
This type of shopping cart is an "off the shelf" piece of software; a one-time purchase of a shopping cart license. It does not include hosting - you can get your own hosting package wherever you want and the shopping cart software is set up to work with it.
The Pros: The low one-time cost is definitely the biggest advantage. You pay one fee and then can use the program forever. If you later outgrow that program, you can sell the software to someone else - getting some of your initial cost back. There’s also a wide selection of software to choose from - many with every feature available, along with continual upgrades. Finally, there’s flexibility in the fact that you can choose your own hosting company and hosting package.
The Cons: Licensed shopping cart software requires that your hosting company meet minimum server requirements, so be sure to check this out before you purchase the software. As long as you’re dealing with a commercial hosting company, you should be fine. Where the problem lies is if your company is getting a cheap hosting rate, because the hosting company is basically a guy running a server out of his basement. If that happens to be the case with your hosting company, then it’s time to switch! You need to have an experienced (and professional) network administrator running the server. Also, since you (or your webmaster) will be installing and running the shopping cart software, it’s possible to delete source files or key pieces of code. As you can see, most of the disadvantages of packaged shopping cart software lie in operator error. If something happens, you can rest assured knowing that you can always call the software company’s tech support.
Hosted Shopping Carts
Consider these shopping carts as more of an e-commerce solution. Basically, you pay a hosting company a monthly fee to use their shopping cart system.
Pros: First off, it’s easy. There’s no software setup or installation and no need to check server requirements. All you do is sign up and begin configuring your shopping cart. And, the best part is that you don’t have to be a webmaster to set it up because everything is user friendly and ready to go! You get unlimited tech support to answer any and all of your questions regarding your hosting and your shopping cart. Updates are usually frequent, so you’ll always be operating on the latest version.
Cons: You have to have the shopping cart company as your hosting company, which means you’re limited to the options and features which they have. You’re stuck with their pricing structure and their willingness to provide extra bandwidth or storage. There is typically a set up fee of about $100-$250. Then, of course, there are the monthly fees - it doesn’t take much to be on a plan that costs $100 or more each month. Also, if you decide to later switch companies you leave with nothing - you don’t get to take the shopping cart software with you.
For those business owners who have little or no knowledge of creating a website and who prefer to not hire a web developer, then having a hosted shopping cart would make the most sense. As long as you don’t mind paying the fees, you can have a shopping cart set up on your site with little effort. However, if you have some understanding of website building (or if you have a web developer), then buying licensed shopping cart software is definitely worth considering. It’s affordable, flexible and customizable to the needs of your company.
Tags: ebusiness, ecommerce, hosted shopping carts, licensed shopping carts, online business, shopping carts
Posted on December 20th, 2007 in Uncategorized | No Comments »
If you work for a corporation or own your own business, this article informs you why you need a business continuity plan (BCP) to protect the financial interests of your company.
According to Ken Doughty, editor of "Business Continuity Planning: Protecting Your Organization’s Life":
"Studies of organizations in the United States that have experienced a disaster have shown that over 40 percent of the organizations struck by a serious disaster never resume operations."
This statistic gives you a staggering dose of reality. Your small or medium business needs a business continuity plan to survive. You may not have thought about the risks threatening your company, but the truth is that it could be severely damaged or completely decimated by a disaster. Consider possibilities like hurricanes, earthquakes, floods, and tornadoes. Consider other disasters like the destruction of your firm’s IT systems. The loss of your infrastructure could put you out of business.
If the threat of losing your business is not enough, consider the fact that many businesses must develop a business continuity plan by federal law to preserve the interests of the stakeholders, including clients and shareholders.
Now that you understand the importance of the business continuity plan (BCP), it is another matter to explain it. A BCP is a comprehensive plan for what steps the company will take if operations are threatened, weakened, or decimated in some unexpected way. How will the company still provide services to its clients? How will the business stay afloat? Will it shut its doors and reopen?
The development of a BCP is complicated, but it includes returning the business to normal operations. Consider possibilities like repairing and reopening facilities, rebuilding infrastructures like technical systems, and financing the cost of recovery. If you have procedures in place for the major steps of recovery, you will be ten steps ahead of the game if a disaster befalls your company.
Remember, the BCP is crucial. Ken Doughty also reports that another 25% of businesses will eventually shut down forever within three years of reopening following a disastrous event.
Don’t let your business become another statistic. Get the help you need to prepare for worst-case scenarios. Protect your financial future and the future of your company.
Tags: business continuity plan, management, planning, preparation, protect financial interests, small business, strategy
Posted on December 19th, 2007 in Uncategorized | No Comments »
PayPal recently introduced the PayPal Security Key. This small device adds a physical layer to the log in process on both PayPal and eBay. The key is the result of a partnership with VeriSign which means that you may be able to register your key with future VeriSign partner websites.
So, what exactly is this so-called key? It’s an electronic gizmo about the size of a stick of gum that you use in conjunction with your regular sign on credentials. The key generates a new six digit code every thirty seconds or so. When you sign on to PayPal, you enter your user name and password as usual and then you must enter this random code which expires after using it once. The codes the key generates are unique to your device and linked account. This means that if someone were to use their own PayPal Security Key to access your account, they would not be able to get in.
Using the security key is easy, but it does add yet another step to the log in process. First, you must order the key from PayPal for five dollars including shipping. Once it arrives, you need to activate it so that the device is linked to your account.
Once activated, any time you log in, you will need your username and password and a six digit code from the key. If you lose the security key, you can still get into your account, though you will need to confirm your account ownership with PayPal first. In addition, if you find that using the PayPal Security Key is more hassle than it’s worth, you can deactivate it by going into the “Profile” tab when logged in and following the on screen prompts.
The PayPal Security Key is designed to attach to a keychain so that you can take it with you and access your PayPal or eBay account wherever you go. However, PayPal recommends that you don’t store it with your computer. This makes sense when you think about it. If someone was to steal your laptop and your PayPal Security Key was conveniently attached, they’d have just about everything they need to hack into your account.
Why do you need a PayPal Security Key? With spyware on the rise, a physical device and randomly generated codes can protect your financial accounts even if a thief has your log on credentials. If you’re concerned about this, five dollars and one extra step logging in are small prices to pay for security.
Tags: ebusiness, ecommerce, online business, online payments, online transactions, paypal, security key
Posted on December 19th, 2007 in Uncategorized | No Comments »
To be a successful manager in today’s world can prove to be a challenge. Even tougher is balancing the role of business owner with that of business manager. The two titles, though seemingly related, can have very different duties, as well as different meaning to your employees. Owners sometimes are seen as figure heads, while managers represent discipline and structure. To successfully meld the two together can be a daunting task to many small business owners.
Here are some tips for the small business owner who also wears the manager hat:
1.) Your Employees are Your Number One Asset: This is the most important and sometimes the most overlooked aspect of management. You will only be as successful as the people who work for you. As a manager, it is your responsibility to lead your subordinates where you want them to go, and then praise them when they get there. Employee moral is the number one success tactic in today’s world.
2.) Look at the Big Picture and Communicate It: As an owner or manager, you often have a solid view of where the company or business is going, or where you want it to go. It is important to communicate the company’s goals and direction to all employees. This will assure that everyone is heading in the right direction and not down their own path.
3.) Do as I Do, Not as I Say: That may sound backwards to some people, but it’s true whether you accept it or not. Many times, managers expect employees to do what they say and ignore what they see. This is like watching a movie where the sound doesn’t match up with the picture. Be consistent. If your employees know what they can expect from you, they will make better decisions.
4.) When It Comes to Decisions, Be Decisive: Common sense? Yes, but many managers fret over their impending decisions and procrastinate. Inaction is no action and produces no results. This is not to say you should make bad decisions or rush into one. Just don’t promote inefficiency or your employees will quit coming to you with their problems.
5.) Realign Business Goals or Standards as Needed: Take the time to look at the decisions you’ve made and how they’ve affected the company. Make appropriate changes in management style, if necessary. Also, periodically re-evaluate your business goals and adjust accordingly. Don’t forget to let employees in on the changes.
Although the above guidelines are just the tip of the iceberg when it comes to management, following the above tips can help keep you focused on where your company is going. Now more than ever, good leadership is an important and fundamental aspect of any successful company out there.
Tags: advice, Hiring and Human Resources, management, managing a smal business, owning a small business, Tips
Posted on December 19th, 2007 in Hiring and Human Resources | No Comments »
For most small business owners, it is difficult to keep up with the broader economic news while still trying to run a company. But as the headlines start discussing the possibility of recession more and more, it’s important for entrepreneurs to pay attention to the writing on the wall and start protecting profits.
So what can you do to make sure that your business is "economy-proof"? Here are ten practical ways to strengthen your business:
1. Make sure your historical record keeping is up to date.
Nothing can bog a business down like drowning in papers. Organize your company’s records and make sure that you have recorded its historical performance so that you can forecast its future growth.
2. Have both a 12-month and a 5-year cash flow projection.
Don’t leave your business’s future to chance. Have a plan and a budget to back it up.
3. Ensure that all processes and procedures in your small business are documented.
Even if the business consists only of you right now, some day you will need to hire employees if you do not want to be forever tied down to your business. Having good documentation helps immensely in the hiring and training process.
4. Hire the best employees possible and invest in their training.
The quality of your staff is critical to your company’s success. Make sure they are well qualified for the task and give them extensive training in customer service as well as the specific tasks they have been hired for.
5. Continually evaluate growth opportunities, whether they arise by purchasing an existing business or customer list, or come from developing a new product or service.
Growth opportunities will present themselves to you regularly. Train yourself in the art of recognizing them when they come along.
6. Formalize your business growth plan and make sure it encompasses all three ways to grow: attract more customers, sell to them more frequently, and sell them more every time they see you.
Leverage your sales efforts. It takes much less time and expense to market to existing customers than bring new ones in the door.
7. Hold monthly management meetings, even if the business consists only of yourself.
If you can explain out loud what happened in your business last month in a way that would make sense to others, you will have a much deeper understanding of your company.
8. Systematize your small business so that it will run effectively even when you’re on vacation or sleeping.
Ultimately, your goal as an entrepreneur is to either have the business run without your daily presence or to sell it for a tidy profit. Both goals require providing a consistent buying experience to your customers through systemization.
9. Test the changes you make in your business to make sure they are effective.
An old business lament goes, "I know I’m wasting half of my advertising money. I just don’t know which half." Make sure that you document the results of any changes you make in your business, such as advertising programs, product or service offerings, or other marketing strategies. Know where your money is going and what kind of a return you’re getting on your investment.
10. Formalize the way in which you and your staff interact with customers to strengthen the relationship and increase sales.
Customers return to franchises like McDonald’s because they know exactly what the business transaction will be. There will be no surprises. They are treated consistently. For your business to succeed, you will have to define how you and your staff will interact with your customers and ensure that they have a consistently wonderful buying experience every time they come to see you.
While you can’t control what happens to the larger economy, you can take some proactive steps to make sure your small business can weather the storm.
Tags: Angie Mohr, growing your business, Numbers101.com, recession, recession-proofing, small business
Posted on December 19th, 2007 in Uncategorized | No Comments »
Would you like to increase your eBay auction sales? In the business world, it’s far easier to sell to an existing customer than it is to go out and recruit a new one. The same holds true in the auction world. A happy eBay customer will keep your auctions bookmarked so that he can come back and see what you’re offering again and again.
What are the best ways to turn an eBay buyer into a repeat customer? Here are some suggestions:
1. Always give the customer a little more than is expected.
When you describe your item, underplay the condition rather than making it sound better than it is. The customer will be pleasantly surprised when they receive it and will make it a point to keep you on their radar screen.
2. Include a quick thank you note with the buyer’s purchase. Have some little cards printed up thanking the buyer for their purchase. Simply sign each one and place it in the package with their auction item. You’ll receive wonderful comments about this practice and it will result in many repeat customers.
3. Give the buyer useful information relating to their purchase.
For example, if he purchases a piece of jewelry, include a sheet on how to care for his jewelry in the package with the item. Make sure your auction I.D. is listed somewhere on the sheet.
4. Consider publishing a monthly email newsletter that keeps the buyer informed about the items you sell. You can include a link in the newsletter to your current auctions. Be sure to get the buyers permission to be on your mailing list before sending out any correspondence.
5. Ship items fast and respond to all questions in a timely manner.
Show off what good customer service you’re capable of practicing. Impress them so they don’t want to purchase anywhere else.
6. Give your customer the gift of convenience. Offer as many payment options as possible. Always offer Paypal, as this is usually the most convenient payment method for the buyer to use. The simpler you make the auction payment process, the more repeat customers you’ll have.
7. Survey your current customers to find out what they want and then offer them more of it. Try to offer new and exciting auction items relating to your buyer’s interests. They’ll keep coming back for more.
Why not use these ideas to turn your customers into loyal, long term customers? Now that you know the secrets of pleasing your customers, you’ll soon be reaping the rewards in the form of increased eBay sales.
Tags: ebay, ebusiness, ecommerce, generating more sales, online auctions, online business
Posted on December 19th, 2007 in E-Commerce and E-Business, Generating More Sales | No Comments »
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