Here is Bob Parsons of GoDaddy talking about 5 steps to building a hot business and how they have worked for him.
I thought I would try to go back to basics this week and publish articles to help the small business person get started. So to start, this post will discuss starting a business.
Anybody can start a business in the United States, and surely anywhere in the world with few exceptions. However, I will tell you that if you want to get rich quick, a business is not the way to do it. Often it takes 2 to 5 years before you will begin making a profit, if even then. So a business is much more of an investment in your future rather than a way to escape your financial condition now. In fact, most ways to “get rich quick” are schemes created by other people to take whatever money you have left.
A business can be your way to improve your future. And starting a business is fairly easy. If you use your name, you don’t even have to register your business in most places. The next step is finding or creating a product or service to sell. Finding the right product can be tricky but opportunities abound. If you can’t create your own product or service, there are tons out there that you can resell. Next time I will write more about choosing the right product.
Please review the following resources for more information:
Back in the 1990’s when we were first starting our business, guys were starting “.com” businesses and investors were just throwing money at them. Having an internet website meant money, sometime in the future, even if you didn’t know how you were going to get it. Putting a great site on the internet meant a great future for the company, and investors were buying the Brooklyn Bridge over and over again. Then, people came to the realization that these businesses they were investing in didn’t make any money, and they probably wouldn’t into the foreseeable future.
And that is the problem. Doing business on the internet is still about doing business. About selling a product. About making a profit. It’s business. And being an entrepreneur is about starting and building a business. It doesn’t matter whether that business is built on the internet, or if you’re building a business using a multi-level marketing plan. It’s still business.
Starting a business is partially about motivation. But it is not all about motivation. Having a certain set of skills in your bag of tricks is important. Knowing how to market and sell is exceptionally important early on. Finding good information. Executing your business plan. These are all very important skills to learn. They can all be learned “on the job”, so as you are starting your business you learn the skills you need at the time. Sometimes, though, you don’t know what you need to know… so it is a good idea to study general business concepts.
You can do it. You can start a business of your own and be successful. Just remember that no matter what you do and how you do it, it is still a business.
This year, 2010, may be the best year in our personal history to start a business. Why? Because we are coming out of the worst recession I have every known and that is usually a period of exceptional economic growth. Businesses will be growing like crazy and hiring the umemployed hopefully, and things will really begin to hum. The time is now to start that new business!
When trying to decide what to do, remember that in business we sell a product or service. Will you invent or create a product, or will you sell somebody else’s product? Will you be a salesperson for another company or will you sell for your company? These are all important questions to answer and are the foundation of your business.
Another important question to answer is: What is your budget for promoting your product and business? Are you starting with nothing or do you have a few hundred dollars a month to spend? If you are starting with nothing, it may be best to be an independent reseller of another company’s product line because they often have everything you need to promote the products. They have materials and advertisements, they may have a website you can use, and they may have an existing customer base that can be sold to.
Multi-level marketing often offers you a good commission for personally selling the company’s products plus a bonus for bringing other sales people into the business. It is a way to start small with real potential for growing big. Success is not going to be handed to you but multi-level marketing offers some real benefits. The downside of multi-level marketing is that there is often competition for the market for the company’s products. The trick is to find a way to either appeal to a new market segment or find undiscovered customers. Often, though, small business people want to sell to local customers and don’t care about building a multi-billion-dollar empire, so selling with little startup is appealing.
Good luck to you and follow through with your New Year’s Resolution to start a new business. Small businesses make up the majority of commerce in the United States and we can sure use the boost right now.
I have been talking about a lot of different things on my blog, but today I thought I would like to give a high-level summary of what it means to be the big fish in your multi-level marketing company. Being the big fish is about image which is made up of several different things:
You are building a business so having a business name and business cards are important. How you present yourself, especially during official business, is also extremely important. The way you dress, how you groom, and if you have showered recently, are all important elements of creating a professional image. Having your own web site can contribute to your professionalism and your image to others.
2. Marketing Method
The way you market your company contributes to your image. If you pester your family and friends over and over to join or buy your product, you are probably creating a negative image. If you create a marketing plan that identifies your market and seeks to deliver your marketing message to your market, this will create a positive image to those who matter most to you: people who would be your customer or distributor.
3. Marketing Effort
People who go 1000% into executing their marketing plan will create a positive image for their company. They are fully committed to their product, what their company can do for others, and they don’t hold back (i.e. for fear of rejection). This is having the faith in yourself to believe you will be successful no matter what others say.
4. Management Execution
You will create a positive image for your company when you can fulfill orders in a timely manner, get people information when they ask for it, answer your telephone professionally, and be there for your distributors. Creating the right image cannot be all about sales and recruiting, it is about doing all of the right things for the people who depend on you.
5. Selling Yourself and Your Company
You personally and your company are what matter to the prospective customer or distributor, not your upline or your MLM company. What are the features and benefits of doing business with you?Â What can you do for your customer? What can you do for your distributor?
Put yourself in your customers’ shoes: What do you expect from the people you do business with? Spend a little time analyzing what you can do better and how you can sell that as a service.
6. Believe That You Are Already Successful, Believe In Yourself
Pump up your ego a bit and believe that you are something special, because you are! You are the person with the company that is going to help thousands of people become successful and financially independent. You are only held back by your beliefs, do a little self talk and make your dreams come true.
Now I am NOT telling you to get yourself all worked up and go out and do a bunch of stuff that means nothing to your business. Get yourself pumped up and work your plan. Find ways of working your plan that don’t cost you a lot of money, or any money if you can. This may take a little creativity but it can be done.
Regardless of what you do and how hard you work, building an MLM business is harder and takes longer than you will expect. Enjoy the little gains and the joy of your customers, and eventually your business will pay your salary and more.
I am thinking of business only a little today. We will get together with my wife’s family this afternoon for a pre-Christmas Santa visit. It is a great time of year to socialize with family and I personally think that it is no time for business or work talk unless I am pushed into talking about it. It’s Christmas for goodness sake!
I do appreciate all of our visitors and I have to tell you that I was pressured to put up the notice about Watkins Products. We have had so many people find us through the internet and they want their baking products! Everybody else in our area has given up but there are so many customers around, we just want to be there for people who need us.
We did pull most of our Amazon.com ads this week because the load time was too slow. We don’t find that Google slows us down much so we are leaving them for now. It really has been a fun journey to start up this blog and see the number of visitors jump day to day. We are starting to use Google Analytics now to give use more detail. If you are interested in measuring your blog traffic, go to http://www.google.com/analytics to learn more.
Merry Christmas to you all! I’m sure I’ll be chatting on my blog before New Year’s Day so I’ll wait for the Happy New Year until later. Can you believe that it’s almost 2010?
In my business life, I have only created two types of business entities: A sole proprietorship and a corporation. In a sole proprietorship, you are not allowed to use the Inc. behind your name. It is also considered a “doing business as” name, i.e. Brian Satterlee doing business as Satterlee Marketing. This means that you personally are responsible for any liability resulting from the operation of your business. You typically register a sole proprietorship with your county agency, run a announcement in the newspaper, then get paperwork from the county so you can open a bank account. A sole proprietorship is reasonably inexpensive to start and you fill out a schedule C on your tax returns for profit and loss.
A corporation, on the other hand, allows you to put the Inc. behind your name, such as Satterlee Marketing, Inc., and is treated like a separate person. You register for an EIN with the IRS and file its taxes separately from yours. Since a corporation is separate from you, it also shelters you from liability provided you follow the rules for a corporation. I used MyCorporation to set up my corporate name and it was around $100. Corporations are usually set up with the state rather than a county. Follow the link below to learn more.
Because I have not dealt as much with LLC’s and other business entities I am not going to try to write about them. Check out this link from the IRS though:
In starting a new business, I would be concerned with liability and professionalism. This is why I chose a corporation as my new business. Corporations look much more professional than sole proprietorships and, because they act as a separate entity, they force more responsible behavior with personal versus corporate assets. There might be other entities that are more fitting for your situation so you might want to chat with an attorney to come up with the right one.
So you have just joined a new multi-level marketing program? What should you do now to help you be successful?
1. Become a business. Being in business has a better image than being an MLM representative. You don’t work for the MLM company do you? You work for your own business so you should have a business name.
2. Get business cards. Exchange them with other people that you meet for their business card so you can stay in touch.
3. Announce your business to your family and friends. Let them know that you are going to sell your products at cost to the people you know and ask if they would like samples. Along with the samples make sure to get them a product brochure or catalog. Note that your family will give you free publicity to their friends, who you also can give samples to, but sell at full cost or at a minor discount.
4. Begin networking your business. Ask people you know for referrals of others who would like the products or might be interested in a business opportunity.
5. Get a web presence and a twitter account. Facebook, twitter, and other social networking sites are nice places to promote your business. You may or may not get orders but you can give it a try. You may also be able to use an affiliate web site set up by your MLM company or an upline distributor to promote your MLM business.
6. Set up a web site, if you can afford it. Having a web site name will improve the image of your business, especially a .com site. Having a web site name can cost you as little as $10 a year, you can either forward it to an affiliate web site for about $10 additional per year, or you can buy web space for about $120 or so per year.
7. Learn by reading books. Marketing, Sales, and Business Management are areas you want to concentrate in. You may also want to read MLM or Network Marketing specific books. Use the library because most books you can buy will also be found there.
8. Remember that you want to market and sell, but don’t forget about the management of your business. You will need to be able to fulfill orders, take telephone calls, and various other support functions for your business. Your business policies will assist in the success or failure of your business.
Make sure to have fun with your business and avoid spending money when you don’t absolutely need to. Good luck to you!
I have much more to talk about with regard to advertising, but I thought we would take a break today. And that is what you need to do sometimes because you have to enjoy your life. We get so busy beating our head against a brick wall in business that we do not realize we still need to be social, we need other activities, and generally we need to do things we enjoy. If you cannot both live your life and run your business, you will not be someone that people want to be around. It might also be a good idea to avoid business talk in social situations, where we are getting away. Note that we sometimes use social situations strategically for business, but there is a time and place for this.
It can be hard to stay motivated and getting away is one thing we can do to remain motivated to keep pressing on with our business. It is tough going day after day networking to build your business and have nothing happen. I am sure you ask yourself whether this is worth it or not. To determine whether it is worth it, perhaps you measure by looking at sales per contact or new distributors per contact. Personally, I would set the bar a little lower. How many contacts are you making? Of these contacts, how many act interested? You can use this to gauge warm leads per contact. If you are getting any warm leads at all, you are doing pretty well and you should pat yourself on the back.
If you are getting no warm leads at all, perhaps your demographic profile is a bit off. It might be a good idea to look at this and make adjustments. Are you contacting enough people? If your demographic is good and you are contacting these kinds of people, at least one in ten should show some interest. If you are contacting random people, your ratio may be as low as 1 in 100, which can be very discouraging, so make sure to contact the right people.
Metrics is about measuring, as we were measuring warm leads to contacts. We can also measure many other things and try to improve these measurements. However, remember that we want to sponsor the right distributors not just anybody, so we need to do things properly to make sure the right people join. This may mean that only 1 in 100 contacts join but that is ok. Better one hard working distributor than a bunch of drop outs or MLM junkies.
One thing about selling product that you probably need to know. Once you have a lead that wants or needs your product, you need to ask for the sale. I like something like this: If you buy today I can offer you a 10% discount. This creates a little urgency and offers a bargain to the customer. Closing a sale is important in selling but the opposite is true in sponsoring. People will sign up in their own time and you should be there when they have questions. They need to want to do the business, so let them sign up when they are ready.
I have probably spooked you into believing that it really isn’t worth it to do multi-level marketing. The main reasons to join a multi-level marketing company and work so hard is that you can make a lot of money and become financially independent. That is not to say that everyone who does multi-level marketing is wildly successful because they aren’t. You really have to know what you’re doing. But if you do know what to do you can make a ton of cash.
We had a total group of around 350 distributors and made between $14,000 and $20,000 in monthly commissions for two full years. That is what multi-level marketing can do for you. Unfortunately, we were working with a dietary supplement company that had the #1 product in the 1990’s, but in 1999 imploded because of issues with the health of its users, lying to the FDA, and getting a lot of bad press. I am not going to mention the company’s name but if you know the industry you can probably figure it out.
Our group was about 50% dropouts who never did anything, 45% small salespeople who sold a little product, and the rest hard-working sales people who could both sell and sponsor. We probably had three big fish who could really sponsor. We were part of the distributor advisory board for the multi-level marketing company and met people who did over $1 million per month in commissions, so we were not the largest by far. So the company had really, really big distributors and really, really little distributors (and dropouts), despite the major success of the product.
So how do you go from being the little guy to being the big fish? You find what works and you do it over and over, and bigger and bigger. Spending money is out of the question when you first start, but money can give you leverage to grow larger quickly once you have gotten to a certain level. You just don’t want to spend it foolishly, and spending it on big unproven advertising campaigns is always out of the question. I will post more about advertising in the future, but for now, spending money on advertising is out of the question when you are just starting. In fact, spending money on anything that you can do for free is out of the question.
Back to the multi-level marketing company for a minute. The company’s product was great, but the company’s business practices and attitudes caused them to run afoul of the media and the government, and ultimately their customers and distributors turned on them. This is sometimes what happens with a quickly growing company. They don’t know how to handle the growth and end up destroying themselves. This is not a good situation when you are depending on them for all of your income. Sometimes going with the tried and true is a better idea.