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5 Reasons Why Your New Year’s Resolution Should Include Small Business Ownership

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You made it! The Mayans were wrong, your family didn’t drive you completely crazy during Christmas and civilization endures. But, there’s another hurtle left to jump: your list of resolutions for 2013. As the number of remaining days in 2012 shrinks, it’s time for you to consider your future…

 

Will 2013 be the year you (finally) learn to love kale and embrace the treadmill? Is this the year you start– and finish– all of those DIY projects? A year from now, as you reflect upon the past 12 months, will you pat yourself on the back because you did what you finally promised yourself you would do: start your own business and become your own boss?

 

Or, will you let 2013 be a carbon copy of 2012?

 

(The correct answer is no.)

 

If you plan on making 2013 your best year yet (and one of financial independence) owning your own business needs to top your list of new year’s resolutions, and here’s why:

  1. THE FISCAL CLIFF: Despite what you’ve heard or read, the majority of small business owners aren’t so doom and gloom about the fiscal cliff/slope/precipice as you might think. As the backbone of our nation’s capitalist society, small business owners know and live the value of progress and forward movement. They’re unafraid of putting their shoulder to the wheel and know that no matter what happens, they’ll make it work.
  2. FUNDING: Traditional SBA-backed loans remain a touch-and-go source of funding for small businesses. Some find traditional lending to be the best and easiest way to raise capital. For others, banks are unwilling to loan for whatever reason.  As a whole, banks say they’d like to make more loans but it seems that many have upped their standards due to regulatory pressure. Regardless, securing a loan is definitely possible.
  3. YOU’RE A VETERAN If you’re a military veteran you are in high demand– especially in the franchise industry.  Many franchises are so pro-veteran they’re onlyrecruiting veterans to become franchisees, like J Dog Junk Removal. Often, veterans are offered significantly discounted franchise fees, financial incentives and mentorship opportunities “regular” franchisees don’t receive. As an added bonus, Sprigster’s “Boost a Hero” program is specifically designed to help veterans and their spouses become franchise and small business owners through crowd-funding.
  4. YOU’RE A FORMER CORPORATE EXECUTIVE OR SMALL BUSINESS OWNER: Exiled or retired corporate executives and former small business owners make excellent franchisees. Franchisors are always keen to recruit those with business experience, especially those with an entrepreneurial spirit and previous management training.
  5. PREDICTIONS FOR 2013: Again, despite what you may have heard, the franchise industry is yet again poised for growth unseen by most other industries since 2008. The number of franchise establishments is expected to increase by 1.4 percent in 2013, from 746,828 to 757,055 with the number of jobs increasing 2 percent, reaching 8.262 million, according to a study by the IFA’s Educational Foundation. In addition, the same report also projects the gross domestic product of the franchise sector to increase 4.1 percent in 2013 to $472 billion.

Still not convinced? Consider the plethora of available franchise and business opportunities looking for eager entrepreneurs at Veterans Franchise.com.

Senate Republicans Vote Down U.N. Disability Treaty

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A Republican senatorial opposition led to the rejection of a United Nations treaty on the rights of the disabled on Tuesday.

 

The treaty, modeled after the Americans with Disabilities Act, has already been signed by 155 nations and ratified by 126 countries, including Britain, France and Germany. The treaty states that nations should assure that the disabled enjoy the same rights and freedoms as fellow citizens.

 

Former Senate Majority Leader Bob Dole, who was disabled during his military service in World War II, and Sen. John McCain, who also suffered disabling injuries as a prisoner of war during the Vietnam War, were both in attendance along with other Republican heavyweights to vocalize their support for the treaty.

 

The 61-38 vote fell short of the required two-thirds majority needed to ratify a treaty. Only eight Republican senators voted “yes”, 38 voted “no”. Republicans objected to considering a treaty during a lame-duck session and they believed that the treaty threatened U.S. sovereignty, despite explanations from treaty backers that the committee created by the treaty has no power to change U.S. law, only to make recommendations.

 

The United Nations estimates that 650 million people, about 10 percent of the world’s population, are disabled.

 

What are your thoughts on this treaty’s rejection?

Obama Has Been Re-elected; Now What?

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Small firms across America awoke on November 7 to news that their small business champion had failed. Governor Mitt Romney admitted defeat early Wednesday morning, just after midnight.

 

Meanwhile, incumbent Barack Obama won crucial electoral votes from swing states Florida and Ohio, the latter serving up the crushing blow for Romney and the GOP.

 

What can small businesses expect from Barack Obama now that he has won four more years as the President of the United States?

 

The Patient Protection and Affordable Care Act is here to stay.

 

The defeat of Mitt Romney and reelection of President Obama means one major thing for Obamacare: it’s here to stay. Small business (and franchises) would do well to research what this means for their particular firm, especially those with 50 or more full-time employees.

 

Beginning in 2014, firms with 50 or more full-time workers will be required to provide their workforce with health-insurance benefits or pay a penalty. Another proviso of the law enforces an additional 3.8% tax on upper-income households beginning Jan. 1.

 

Taxes will rise for couples making less than $250,000 a year.

 

Tax policy was a particularly important issue for small business owners during the general election as many of them declare their business incomes on their personal returns.

 

During his campaign, President Obama said he supported extending the Bush-era tax cuts for couples making less than $250,000 a year. Mr. Obama also supports letting those tax cuts expire for higher earners and also creating a new minimum tax for those who make $1 million or more.

 

For those who count themselves as ‘higher earners’ that means a top marginal tax rate of 39.6% for salaries and wages. The top rate on dividends for upper-income households would be higher — 43.4%– when the aforementioned 3.8% tax kicks in on Jan. 1.

 

The fiscal cliff still looms.

 

The aptly-named fiscal cliff still looms before the country as January 1, 2013 quickly approaches. The fiscal cliff, created by the laziest Congress ever and Mr. Obama last year in order to lift the debt ceiling, threatens the U.S.’ economic recovery. If the 113th Congress doesn’t do something– and do something immediately — the deep spending cuts and tax increases could push our fragile economy back into a recession– or worse.

 

Both Democrats and Republicans want to avoid the deep cuts but cannot agree on how to replace them.

 

Shocking, I know.

 

Promise on the horizon for small businesses that need capital.

 

Access to capital has been a substantial hurdle for business owners just starting out or looking to expand since the recession as banks — large and small — are slow to lend. The Jumpstart Our Business Startups Act could provide relief as it includes a provision allowing small businesses to raise as much as $1 million in equity funding using crowd-funding websites. Of course, the crowd-funding websites will have to register with the Securities and Exchange Commission, but it’s a step in the right direction.

 

 

What Franchises Need to Know About Satmetrix

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What to do when your customers go from engaged to enraged.

 

The advent of social media has ushered in a new customer service paradigm. Interactions between a business and its customers — positive or negative– are now part of a company’s narrative thanks to platforms like Facebook and Twitter.

 

For businesses, this presents an opportunity to engage with its customer base and obtain feedback on its products and services. Under normal circumstances, this is a good, even great, thing. But, when a customer turns from engaged to enraged, a business is often caught off-guard, especially if a customer chooses to vent his or her frustration publicly. An angry customer is a scary thing; an angry customer on Twitter or Facebook is terrifying.

 

Dissatisfied customers present a unique challenge to franchises. Negative feedback expressed publicly can not only tarnish the reputation of the local outpost, but also influence a potential customer’s perception of the brand overall. As Forbes reported earlier this year, “when you make a decision to choose one brand over another, you’re influenced more by the company’s reputation than any particular product it offers.”

 

So how do you manage your reputation, keep your customers happy, and protect your bottom line? Satmetrix has a suggestion: put your net promoter score to work.

 

There are three types of customers: promotors, passives, and detractors. Customers that support and advocate for your brand are promoters. Those that support your business but aren’t telling their friends and family about you are considered passives. Customers that speak out against your business due to a poor experience are labeled as detractors. A brand’s net promoter score is calculated by subtracting the percentage of detractors from the percentage of promoters and provides a company with a numeric indication of its customer base’s level of satisfaction.

 

Traditionally, a net promoter score was calculated through surveys, which have become so ubiquitous they’re ineffective. Fewer and fewer customers care to respond to surveys because they get so many. Spark Score, a program from Satmetrix, surveys what customers are already saying by sweeping the Internet and social media.

 

At this point, the folks at Satmetrix decided to go a step further. After the net promoter score has been calculated, more questions are asked. In doing so, Satmetrix is able to draw a correlation between the net promoter score and what’s causing a customer to recommend your brand or, in some cases, to not recommend your brand. The goal is to identify the moment that franchises (and other businesses) are dropping the ball in order to fix the underlying error, improve overall customer relations, and ultimately win customers back.

 

A recent study performed by the Gallup Business Journal indicates that bringing on new customers is about emotion, not price or product. It costs more money to woo a new customer than it does to keep an existing one. In addition, satisfied existing customers spend an average of 2.6 times more than one that’s relatively satisfied and 14 times more than one that isn’t satisfied.

 

In the graph below, total revenue is represented by the total sales from passive and promoter customers in a nonexistent company. Total potential revenue represents the total sales from promoters, passives, and detractors who have returned as passive customers after having their customer service issues resolved. On average, the difference between the total and total potential revenues each month is $9,333.

 

The way Satmetrix has designed their program gives franchises the ability to assign each customer type a value, placing into perspective the real cost of a dissatisfied customer. In the case of the nonexistent company above, one detractor equals 2.6 passives and 1 promoter. So, when you lose a customer due to a poor customer service experience, you may need two customers to make up the difference in lost revenue.

 

At the end of the day, it’s more than the loss of a customer and sales; a detractor also has the ability to turn potential clients into detractors before they’ve even become a paying customer. When you’re looking to try a new restaurant or need help mowing your lawn you turn to family members and your friends for recommendations. The same applies to every business.

 

Satmetrix hasn’t stopped at creating a better net promoter score or helping companies assign a value to each customer type. With Satmetrix, sales teams can respond to customer service emergencies in real-time, assuaging a dissatisfied customer’s frustrations before they’ve said sayonara and been welcomed with open arms by a competitor. It’s also at this point that Satmetrix can help companies identify exactly where they’re going wrong in the sales process. As Carol Tice of Entrepreneur magazine points out, two of the best ways to keep angry customers from storming out and never coming back are reaching out via social media and fixing the broken policies.

What the Olympics Can Teach Us About Franchising

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The world’s best, strongest, fastest, and most talented athletes are competing for personal glory on the world’s most public stage: the Olympic Games. Behind the fanfare, sponsorships, and medals lie years of hard work, sacrifice, and standing on the shoulders of your supporters.

 

As a franchisee, your business is your Olympics. While you may not find yourself on a podium decorated with a bronze, silver, or gold medal at the end of each day, your customers, employees and franchisors are judging your performance.

 

The Importance of Passion

Take a page out of an Olympic athlete’s book: passion is paramount. How else could you dedicate 20 years of your life, as Michael Phelps has, to hours and hours of training? To not watching your favorite television show? To not ordering dessert? The only time that sacrifice doesn’t feel sacrificial is when what you stand to gain is greater than what you are forgoing. That, and when what you’re doing still feels like fun.

 

Olympic athletes are often quoted pre-and-post event on the importance of, “going out and having fun.” Without some semblance of fun, the hours in the gym, pool, or at your business, would be unbearable. That’s why when choosing a franchise concept it’s important to be truly interested in or passionate about the business you’re about to buy into. Franchise agreements are written in terms of years. Most are between 10 and 25 years. Can you imagine doing something you don’t really like for so long?

 

What It Means to Be a Part of Something Larger Than Yourself

 

There’s something to be said for being a part of something larger than yourself. Recognizing your place as part of the whole (as opposed to the whole) can be humbling and empowering.

 

As a business or franchise owner your importance is obvious. Without you there wouldn’t be jobs for your employees or services and products for your customers. Then again, if it weren’t you it would be somebody.

 

Embracing this reality and mentality can make you a better manager and franchisee. When you accept that your role, while important, exists only thanks to your franchisor, your customers and your employees, it’s easier to be more appreciative of how your business truly works.

 

Furthermore, realizing your place in something bigger serves as a reminder that you are responsible to and accountable for others—an important inspiration for staying true to your endeavors when you lose sight of your goals. Perhaps this is why Olympians become so overwhelmed with emotion; they see they represent more than just themselves.

 

The Importance of Support and Guidance

Regardless of what you may believe, we all stand on the shoulders of those who have come before us—and thank goodness for it! The experience and knowledge of others is invaluable whether you are an Olympic athlete or a franchisee.

 

Can you imagine going to the Olympics without the guidance or tutelage of a coach? Can you imagine becoming a business owner without support from your family or friends? As a franchisee, you not only have the support of your friends and family, you have the support of a network of franchisees and franchise support systems designed to make you and keep you successful! While your personal and financial preparation is your responsibility, you are not without resources or guidance.