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RapidResource is dedicated to providing you with insightful and useful
information for your business. Small Business Insights is a free monthly
newsletter sourced from leading publications and summarized in a quick,
easy to read format. We hope that this information will help take your
business to the next level.
Headlines
Bright Ideas
"Six Strategies for
Making Smart Hiring Decisions"
"Strategies for Reining
in Energy Costs"
"Bad Breakup: A
Checklist for Employee Termination"
"Small-Business Owners
Learn to Adapt in Economic Downturn"
Grow
"Tips for Business
Planning for the Next Generation"
"Do-It-Yourself
Marketing Creates Surprising Results"
"Strategy Matters: 5
Reasons Why Strategy Fails"
"What Are They Saying
About You?"
Money Matters
"States Give Small
Business More Health Care Help"
"How Financing Trends
Impact Entrepreneurship"
"Strategies: How to
Keep Your Business Bank Accounts Safe"
"Return on Investment:
Get a Big-Picture View of Your Business"
Off Hours
"6 Affordable Beach
Resorts"
"Buying a Gas Grill:
What You Need to Know"
Bright Ideas
Six Strategies for Making Smart Hiring Decisions
Information, Inc. (08/08) Corbin, Kenneth
Business leaders from all industries acknowledge that their staff is
their most valuable asset. Yet the way that many small businesses make
their hiring decisions indicates that they either don't share or ignore
this belief. The fact is that your staff is critical to your company’s
success, which means that you must have a plan in place for the
processes of recruiting, interviewing, and selecting your staff, just as
you have strategies for how you handle vendors, inventory, lenders or
investors, and customers. Here are six tips to help you make better
hiring decisions to ensure that your organization is filled with the
very best people from top to bottom. First, arrive at a definition of
your ideal candidate. It is impossible to recruit the best person for
the job if you don't have a clear idea of what that person would be
like. Next, never stop interviewing. Just as you should cast a wide net
when evaluating potential sources of qualified applicants, you should
never let yourself lapse into the ‘we're not hiring right now’ mode.
When interviewing a potential candidate, be sure to probe the
applicant’s character in the interview. Textbook interview questions
yield textbook interview answers. Try to come up with questions that the
applicant has not rehearsed through his job hunter’s guides. Fourth,
hire the person, not the resume. Remember that anyone can be trained on
the technical aspects of a job, but not everyone has the character and
personality to complement your team. Fifth, don't keep your best
prospects waiting. The odds are that they will be interviewing at
multiple companies, and they are not likely to wait around for your
company to get its act together. Finally, accept the fact that you must
hire people who will do their jobs better than you can. Successful
business leaders across the board agree that it is a vital part of
making smart hiring decisions. Your goal is to have the best possible
staff in place to advance your business, and once that staff is in
place, then your business is poised to rise to new heights in its own,
unique fashion.
Return to Headlines
Strategies for Reining in Energy Costs
Wall Street Journal (07/05/08) Spors, Kelley K.
As energy prices continue to rise, small businesses are scrambling to
find ways to lower costs. While it may be tempting to try a patchwork
approach to saving energy, making slight alterations to a variety of
areas, it is more practical to concentrate on the biggest energy
consumers to save the most money with the least effort. For example,
restaurants can focus on installing highly-efficient refrigeration
systems and lighting, as those tend to be the biggest energy costs, says
consultant Virginia Lacy. Other strategies include energy-efficient
water heaters, switching to high gas mileage vehicles for deliveries,
and giving drivers access to GPS systems or mapping sites such as
MapQuest so they can find the most efficient route to a destination and
not have to drive around to find a location. Once the large energy
consumers are taken care of, focus on small changes in behavior that
could lead to big savings. For example, turn off equipment and lights
when not in use and make sure buildings are properly insulated.
Energy-efficient light bulbs can be a significant investment initially,
but they can pay for themselves in three years or less. A building
recommissioning, essentially a professional building tune-up, can help a
business save up to 10 percent on energy costs by checking for leaks in
heating and air-conditioning systems, among other strategies, Lacy says.
An energy audit can also help save money by helping businesses determine
which energy-strategy project will garner the fastest returns. Energy
auditors thoroughly analyze a business' energy usage by examining energy
bills and inspecting equipment and the building. Many local utility
companies offer free energy audits to small businesses. The power
company can also help businesses find utility rate plans that best fit
their usage patterns.
Return to Headlines
Bad Breakup: A Checklist for Employee
Termination
Washington SmartCEO (07/08) Vol. 4, No. 7, P. 51; Baskin, Maurice
Recent surveys suggest that nearly half of all employment terminations
result in some type of administrative complaint or litigation, and while
there is no way to completely avoid such disputes, small businesses can
protect themselves by better preparing for employee separations and
post-termination actions. Before terminating an employee, go over a
checklist to make sure termination is necessary and that you are
protected from retaliation. Do you have a legitimate reason for
termination, and is there documentation to support it? Has someone
spoken to the employee up for termination to get his or her side of the
story? Have all potential witnesses been spoken to? Is the employee
being treated in a manner consistent with your employee handbook and
established practices? Has the business treated any other employees
differently who have committed the same offense? Has the employee
complained of discrimination, harassment, or failure to accommodate a
disability, and if so were those complaints addressed? Does the
discharge appear to be in retaliation for any previously filed
discrimination claims or "whistleblowing?" Should the employee be
offered the opportunity to resign in exchange for a valid release of any
potential claims? Actions during and following termination are just as
important as preparation. Make sure to have a management witness present
when communicating the decision, and truthfully state the reasons for
termination. Be sure to comply with applicable wage payment laws,
severance policies, administration of benefits, and insurance law
requirements. Consider offering post-termination benefits in return for
a release, and review and possibly obtain counsel with regard to any
proposed responses to inquiries from unemployment compensation agencies
to maintain consistency with previously stated reasons for the
discharge.
Return to Headlines
Small-Business Owners Learn to Adapt in Economic
Downturn
Kansas City Star (07/21/08) Goforth, Alan
Many small businesses are feeling the pinch from a shaky economy,
climbing prices, and low consumer confidence. Small business experts say
small businesses looking to survive difficult times must react to the
times and stay nimble, watch their costs, and be innovative. Innovation
does not mean reinventing the company, but rather looking for new ways
to sell products or services and expanding to new markets. Last month,
for the first time since the early 1980s, small business owners cited
inflation as their leading worry in a monthly survey conducted by the
National Federation of Independent Business, with rising fuel costs
cited as a particular concern. Fortunately, access to business credit in
this tight economy is not a major concern for most small business
owners. In the survey, 35 percent of small business owners reported
regular borrowing activity, which is a typical result in surveys taken
over the past 15 years. Only 2 percent of owners cited the cost and
availability of business credit as their No.1 business problem.
Return to Headlines
Grow
Tips for Business Planning for the Next
Generation
Las Cruces Sun-News (NM) (07/14/08)
The Service Corps of Retired Executives (SCORE) offers several tips to
help small businesses develop plans for long-term growth. SCORE says
that ongoing business planning is critical for operating in a
continuously changing business environment that can offer unanticipated
opportunities as well as challenges. A small business should return to
the business plan every quarter or six months to compare projections
with current realities, update as needed, and adjust expectations for
milestones. Small businesses should keep a close watch on financial
statements by comparing actual cash flow to projections, so that they
can uncover any opportunities to improve performance. They should also
follow world and community events; study their sales records; and
communicate with customers, suppliers, and colleagues so they are not
caught off guard by the fast-moving global economy. Building
relationships with businesses in your field and specialty consultants
can offer a cost-effective way to address immediate and long-term needs.
And passing some routine and management responsibilities to certain
employees can give the owner of a growing small business extra time to
focus on other key matters. Also, entrepreneurs should discuss their
plans with a mentor, and ask for advice.
Return to Headlines
Do-It-Yourself Marketing Creates Surprising
Results
Investor's Business Daily (07/07/08) P. A6; Stettner, Morey
Building relationships has enabled Amy Scherber to market her bread
bakery like a professional, even though she does not rely on a marketing
company or a public relations firm and has no advertising budget.
Scherber, founder and owner of Amy's Bread in New York City, keeps in
contact with friends from high school, and her notoriety among her
alumni community has soared after she was nominated for Alumnus of the
Year and took home the award in 2005. She is also involved in her alumni
network from St. Olaf College in Northfield, Minn., and hosting an event
for an alum has also boosted the profile of the business among the
school's graduates. Scherber develops business relationships with
editors at publications before calling them about potential stories,
provides members of the media with the latest news when they come by to
buy bread, and mingles with reporters at food industry events. "I don't
bombard the media with my ideas," Scherber says. "It's better to know
what kind of stories they like and be selective when you call them." And
joining groups such as Women Chefs & Restaurateurs and the Bread Bakers
Guild of America has given the business more visibility among Scherber's
peers. She also spends about $2,000 to $3,000 a year on items she sells
in her three retail stores, such as T-shirts.
Return to Headlines
Strategy Matters: 5 Reasons Why Strategy Fails
bMighty.com (07/02/08) Merchant, Nilofer
Following a previously successful small business strategy can help your
company grow, but it is also important to understand why strategies
fail, writes Rubicon Consulting CEO Nilofer Merchant. Unsuccessful
strategies fail because there is a mismatch and people can be fearful or
get confused if they have information that contradicts the strategy.
When a strategy does not mesh with what employees know is true, they may
wonder if they should go along with the strategy or speak up and make
others aware of the problems. When employees doubt whether they should
make others aware of problems, the strategy has already failed. Second,
strategies often fail because of a lack of team involvement. Businesses
need to understand that strategies must be deployed at every level, as
often it is people lower in an organization's structure that will be
able to identify problems with a strategy, make others aware of the
problems, and create solutions to the problems. Another problem is that
people may try to implement a strategy without understanding where the
strategy comes from and what its true purpose is. Even the idea of
"flawless execution" assumes there is a target everyone is striving for,
but it is rare to find such uniformly aligned goals among employees in
any business. A good strategy reinforces the ability of people in an
organization to synchronize, know how to adjust, make good decisions,
and feed information back into the system for fine tuning. Lastly, poor
decision making can ruin a strategy if the people in the organization do
not see these bad decision as the source of failure. Too many goals or
conflicting imperatives create situations where every objective is top
priority, meaning the truly important goals are lost in the crowd and
nothing really gets accomplished.
Return to Headlines
What Are They Saying About You?
Fortune Small Business (08/08) Vol. 18, No. 6, P. 63
The Internet offers small businesses a variety of opportunities to
expand their business and engage customers. The Internet has become a
place for consumers to share information and experiences, and some may
be discussing their experience with your business, both the good and the
bad. Consumers trust each other more than they trust advertisers or
businesses, which makes online reviews an incredibly powerful feature
that can affect any business. Small businesses are particularly
dependent on favorable testimonials and word of mouth, so a negative
review or comment about a business online can be very detrimental. The
key to making online reviews, both the good and the bad, work for your
small business is to monitor conversations about your brand. Tools such
as Google Alerts can be used to monitor the Internet for mentions of
your company name. Blog search engines can also be used to find what
people are writing about your business. You can use negative reviews to
identify and fix problems in your business you otherwise might have
missed. If your business is being unfairly criticized, it is important
to respond in a professional manner. For example, if a blog is
wrongfully accusing your staff of being unethical, write a post
explaining your side of the experience, and provide a link to your
ethics policy. You can also maintain your own blog to find out what
customers think about your business, but be sure to write about your
business honestly, discussing both the positives and areas you know your
business needs improvement, to maintain your credibility as a blogger.
Return to Headlines
Money Matters
States Give Small Business More Health Care Help
Kiplinger Letter (07/15/08) Craver, Martha Lynn
The health care packages that several states have enacted to assist
small business owners in providing insurance to employees are less
costly measures that provide subsidies, tax deductions, and affordable
plans. Florida is the latest state to offer basic policies to employers
with 50 or fewer employees in effort to keep costs down. South Carolina
will allow 10 or more companies with at least 50 employees to join
together and negotiate for lower rates. Oklahoma, where the state and
employers cover 60 percent and 25 percent of the cost, respectively, is
expanding eligibility for its program to employers that have up to 250
employees and raising the income cap for workers. In Alabama, businesses
with fewer than 25 workers will be able to deduct 150 percent of what
they pay for premiums from their state income taxes, and employees who
earn $50,000 or less annually will be able to deduct 150 percent of what
they pay for health insurance. Small business owners are unlikely to see
bigger reforms until the economy rebounds and state revenues improve.
Return to Headlines
How Financing Trends Impact Entrepreneurship
Forbes (07/22/08) Rao, Dileep
Small businesses exist in all manner of industries, but working capital
is a constant constraint for every small business, and many are finding
traditional revenues for capital to be unavailable, writes Carlson
School of Management professor Dileep Rao. Regional banks, having rushed
head long into the subprime lending disaster, are trying to recoup
losses by increasing rates on other loans and credit cards. Meanwhile,
the Small Business Administration is cutting back on SBA loans, and
putting the burden on entrepreneurs to shoulder more of the risk. The
U.S. venture capital (VC) industry is also shrinking, with the number of
VC funds in the United States falling to 844 from about 1,200 at the
beginning of the century. Rao says these pullbacks in traditional
funding mean entrepreneurs and small business need to find other
available methods for obtaining working capital. Small businesses need
to find appropriate customization options that can give them the working
capital they need to expand and improve their business.
Return to Headlines
Strategies: How to Keep Your Business Bank
Accounts Safe
USA Today (07/25/08) Abrams, Rhonda
The recent collapse of a major U.S. bank highlights the need to
understand the federal government's deposit insurance protections. The
U.S. government, through the Federal Deposit Insurance Corp. (FDIC),
protects up to $100,000 per individual, but that applies to all accounts
an individual has at any one bank, including both business and personal
accounts if the individual is the sole proprietor. Small businesses can
easily have more than $100,000 in their business bank accounts, which
can include a business checking account, a money market account, and a
certificate of deposit. Some retail operations and restaurants can have
tens of thousands of dollars going through a bank account every month
that could quickly exceed $100,000. Additionally, many small business
owners use the same bank for their business and personal accounts, as it
is easier, and often necessary, to transfer funds between accounts. To
make sure all your assets are protected, it is important to know a few
specifics. The FDIC covers only $100,000 per bank per "entity," which
includes individuals, corporations, and legal partnerships, each of
which can have separate FDIC insurance up to the $100,000 limit. Sole
proprietorships are not separate entities from the individual, so if
your business is not incorporated or a LLC, your business accounts are
not covered separately from your personal accounts. However, if a spouse
is on a personal account, he or she is also insured up to $100,000.
Legal corporations, LLCs, and legal partnerships are separate entities.
A legal partnership is a single entity with a $100,000 insurance limit,
no matter how many partners are in the legal partnership. If you have
more than $100,000 in all your business and personal accounts, consider
switching some funds to another FDIC-insured bank.
Return to Headlines
Return on Investment: Get a Big-Picture View of
Your Business
Smart Business Ideas (07/08) Vol. 4, No. 7, P. 34; Black, Joy
Return on investment (ROI) is a term well known to small business
owners, but many do not know how to properly apply ROI analysis. ROI is
a performance metric designed to help gauge the efficiency of an
investment or to compare the efficacy of a number of different
investments. ROI is calculated using the expected benefit or return from
an investment divided by the associated expenses, with the tally
expressed as a percentage or ratio. ROI can be applied to almost any
scenario, and its straight forward approach makes it a popular
measurement, though it is a very general way of calculating potential
profitability in an investment. For example, a ROI analysis can be used
to evaluate a proposed investment in new equipment for your small
business. A company may be able to save $5,000 in operating expenses,
and raise profit by that amount, by spending $25,000 on new equipment.
By dividing the increase in profit new equipment would bring, by the
expenditure of capital needed to acquire the equipment, a business can
determine its ROI. If the ROI is greater than the cost of the capital
prior to making the purchase, and if there are no other investment
opportunities for those funds, buying the new equipment may be a good
choice. When using ROI analysis, remember that ROI calculations can be
easily manipulated to suit a specific purpose as the calculation is
subject to whatever one choose to count as associated costs and returns.
Furthermore, business owners often fail to comprehend the actual scope
of a business investment, which creates skewed ROI calculations, and
many business owners fail to assign the proper value to their own time,
which should be calculated along with cash and other human resources.
Return to Headlines
Off Hours
6 Affordable Beach Resorts
Vacations (08/08) Vol. 22, No. 4, P. 32; Armstrong, Elizabeth
Don't put away your sunscreen when summer ends. Fall is a great time to
escape to an all-inclusive resort in the Caribbean or Mexico, as many
drop their rates to attract more visitors during the slower travel
season. For under $1,200, you can score a great seven-night,
mid-September getaway for two at the following six resorts. (The prices
are courteous of
www.ResortVacationsToGo.com and do not include airfare.) Iberostar
Punta Cana is a four-star resort in Punta Cana, Dominican Republic, and
boasts a beachside bar, multiple buffets, and a bevy of activities,
including lessons in Spanish, meringue, archery, and diving. The trip
will cost you $1,063. Also in the Dominican Republic is ClubHotel Riu
Bachata. You will pay $760 and may also take advantage of the amenities,
recreation, and restaurants at adjacent Riu Mambo and Riu Merengue. All
the traditional resort activities are available, and the Caribbean
Street promenade boasts a very of stores, a spa, and a gym. Snacks are
offered around the clock, buffets feature cooking stations for
customized ordering for three meals a day, and rooms boast minibars and
liquor dispensers. Point Village is also in the Caribbean, but over in
Jamaica. The three-star resort, priced at $969, has a freshwater
swimming pool in addition to natural rock pools filled with seawater.
Guests can dine buffet-style in the resort's main dining area, at one of
its restaurants, or out on the beach on Wednesday evenings when the
resort throws a beach bash. If you'd rather head to Mexico, check out
the Barcelo Costa Cancun in—you guessed it—Cancun. Kayaking, pedal boat
outings, snorkeling, and a free scuba lesson are all included in the
price, which is $1,190. The resort is kid-friendly as guests 5 or
younger stay free, and children ages 6 to 12 pay discounted rates. The
site offers four restaurants. Over in Cozumel, Mexico, is the 4.5-star
Melia Cozumel, for $1,008. It offers a wide range of recreation for
active guests, a spa, informal classes, and a golf course. Eat at one of
the resort's two specialty restaurants and enjoy a cocktail at one of
five bars. Another 4.5-star resort in Mexico is Riu Vallarta in Puerto
Vallarta. For $887, socialize at a number of lounges or the nightclub,
eat at one of the restaurant's or special-themed buffets, take advantage
of the beach activities, and use the amenities or dine at sister resort
ClubHotel Riu Jalisco.
Return to Headlines
Buying a Gas Grill: What You Need to Know
Food & Wine (06/08) Vol. 31, No. 6, P. 84; Quinlan, Christine
It is often said "you get what you pay for," but you can get a good gas
grill for $300, $1,000, or $5,000, as long as you know what you are
looking for. If you are shopping for a $300 grill, search hard for one
made of all stainless steel, as these will be the most durable, as well
as one that has tube-shaped burners, rather than U-shaped or circular
burners, because they heat more evenly. It might be hard to find a $300
grill with side burners, but it is not impossible. Also, look for a
grill with cooking grates made from stainless steel or porcelain-coated
cast iron. Grills at this price level will almost always feature knob or
push-button ignitions and will be large enough to grill food for four
people. If you are willing to spend $1,000, you should have no problem
finding a grill made entirely of stainless steel. Use a magnet to test
the grade. If the magnet sticks to the grill it indicates that the
stainless steel is lower quality, so look for one where it will not
stick. Other things to look for, but that are not always included, are
rubber wheels with a full axle, individually-controlled tube-shaped
burners, side burners, a smoker or a rotisserie, grates made of
stainless steel or cast iron, and electronic ignition. Grills at this
price level will be larger in size and be big enough to cook for eight
to 10 people. If you are ready to spend $5,000, search for high-grade
stainless steel grills made in the United States by hand with welded
seams, which extends a grill's lifetime. Some grills at this price offer
the option of switching between gas and charcoal or wood, while others
feature infrared burners for high-heat searing, as well as basic
burners. Most of the time, the cooking grates will be made from
stainless steel, otherwise, cast iron. All $5,000 grills should be able
to cook for 12 to 15 people and should include a battery-powered
electronic ignition, side burners, roomy smoker boxes, rotisseries,
halogen lights inside the hood for grilling at night, built-in trays to
hold condiments, spacious side shelves, and built-in storage space.
Also, when shopping, remember that the more expensive the grill, the
longer its warranty.
Return to Headlines
Abstract News © Copyright 2008
INFORMATION, INC.
August 2008
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