Business Finance 101

This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on March 17, 2017. For many of us, understanding financial matters is a challenge, and options for financing the startup or expansion of a business may be difficult to grasp. This is a perfect example of a… Read more »

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This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on March 17, 2017.

For many of us, understanding financial matters is a challenge, and options for financing the startup or expansion of a business may be difficult to grasp. This is a perfect example of a great time to contact the Alexandria Small Business Development Center for help. Financial guidance is among the free services offered by the Center.

Astute business owners know that having a financial expert routinely review their financial statements with them makes them better managers. They know that it makes sense to do an annual fiscal check-up. They know that, at the first indication that they need working capital, an expansion loan, or even a startup loan, the most efficient approach they can take is to work through their business plan and loan request with an expert. Some have equated this process with getting coached for an interview.

Alexandria Small Business Development Center Business Analyst, Jack Parker, has been an independent contractor with the Center for 19 years. In that time, he has worked with owners to help them better manage the financial aspects of their business. Over the years, he has helped more than 265 business owners and start-up entrepreneurs obtain loans or investments totaling over $71 million.

As a retired banker, Jack knows what loan officers expect to see in a loan request. He knows that they want those requests to clearly show how that loan will be repaid, and they expect the applicant to provide sound financial projections supported by written assumptions. Some bankers indicate they have greater confidence in the requests that come through working with the Center. Their experience is that Center-assisted applicants are typically much better prepared and are therefore much better credit risks.

Thanks to the Center’s strong partnerships with local banks, bankers often refer prospective borrowers to the Center to obtain guidance. Nine Alexandria banks are currently financial supporters of the Center, and many of their lenders work closely with Jack to connect business owners with the right services. This could include helping business owners develop strong banking relationships, establish lines of credit or seek financing.

Being unprepared for a loan application can have far-reaching effects. Many prospective borrowers might not realize that, anytime your loan application is turned down, it can affect your credit rating. At the Center, Alexandria business owners have access to a free resource who can work with them to fine-tune their loan or line of credit application so that it answers almost every question that a loan officer will ask.  That way, when they approach a lender, they will have confidence in the plan they’re presenting, and have a much greater chance of it being approved.

Whether or not a business owner needs financing, it behooves them to have a strong and confidential relationship with their bank. The Center is glad to have a resource to help Alexandria business owners develop such relationships and better manage the financials of their business. We welcome your contacting the Center for such guidance.

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Spinning Your Wheels on Marketing?

The following blog was written by Heidi O’Leska, Vintage Juice Brand marketing, who presented a workshop on this subject for the Alexandria SBDC last week. More than likely, it’s not the marketing, it’s the message.  I often hear from clients, we spend tons of money on direct mail (or print advertising or social media) and… Read more »

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The following blog was written by Heidi O’Leska, Vintage Juice Brand marketing, who presented a workshop on this subject for the Alexandria SBDC last week.

More than likely, it’s not the marketing, it’s the message. 

I often hear from clients, we spend tons of money on direct mail (or print advertising or social media) and results are less than 1% ROI. No bueno.

So, what’s the answer? 

  • What’s your Why? People don’t buy what you do, but instead, why you do it. They want to be inspired, appeal to their gut feeling/intuition.
  • Pinpoint what your business does differently and better than competition (based on your why).
  • Define what audience is eager for that offering, and within that audience, which is the most profitable
  • Create messaging around that offering that is bold, creative – a true stop them in their tracks and make them think, want to learn more
  • Research and develop a marketing plan to deliver that message or series of messages to your most profitable target audience using the communication tools they are most likely to use.

Differentiators – Best Quality, Best Service, Lowest Prices are NOT differentiators, most people say that, most customers don’t believe it until they experience your product or service, don’t waste time saying it, especially in the 8-10 seconds you have to first catch their attention. What’s the true differentiator? The intersection between what competitors are NOT saying and the true, genuine WHY you started your business. I facilitate messaging workshops with business owners and executives that includes taking an objective look at what competitors are saying and compare that to the true WHY of the organization, as well as its weaknesses. The methodology always results in a differentiator resonates – as well as creative ideas to communicate it.

Most Profitable Target Audience Your business cannot be all things to all people, unless you have a boatload of money to spend (throw away). The most successful businesses start with one very specific target audience and offering. Reaching 10,000 high-income residents within 1-2 miles of your business with a message that appeals to their lifestyle has resulted in 30% response rates vs. a generic message to the entire population with less than 1% return. Even if 1% of a larger population nets the same number of individuals reached as the 30% of 10,000 (3,000) a generic message to all falls flat, resulting in:

  • Lower sales per person
  • One-time customers, never to return
  • Often, bad online reviews. Why? They don’t understand your WHY, they aren’t your audience

As part of our methodology we conduct focus groups and one-on-one interviews with our clients’ various audiences. With data in hand, we narrow down the most profitable audiences and develop personas for each, as the go-to for all new marketing initiatives.

Bold Messaging  – Don’t wimp out. And, don’t try to develop it yourself. Shameless plug, but, creative agencies are objective and well, creative!

Targeted Marketing – With your most profitable target audience in mind…

  • Millennials? – Facebook and even your website is a thing of the past to Millennials, concentrate on Instagram and getting great Yelp and Google reviews. Don’t even consider print advertising.
  • Baby Boomers? – Facebook, Facebook, Facebook – the MOST targeted advertising available. Print in a local magazine that is well respected by residents, with your BOLD message, remember, don’t wimp out.
  • Generation X or Y – A combination of the above, dependent on your product and what is available in your region.

Interested in a 30 minute, complimentary assessment of your brand? Call me (Heidi O’Leska, President, Marketing Strategist, Vintage Juice Brand Marketing), (703) 922-2442.

Branding & Marketing Agency based in Alexandria VA.

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Recognition: Great to Get – Even Better to Give!

On March 23rd, the Alexandria SBDC will celebrate the fact that our colleague Patra Frame of Strategies for Human Resources has won the award as the State of Virginia SBDC Small Business Veteran of the Year. (click here to attend the celebration – all are welcome!)  We nominated Patra for this statewide recognition several months ago… Read more »

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On March 23rd, the Alexandria SBDC will celebrate the fact that our colleague Patra Frame of Strategies for Human Resources has won the award as the State of Virginia SBDC Small Business Veteran of the Year. (click here to attend the celebration – all are welcome!)  We nominated Patra for this statewide recognition several months ago because not only is she a decorated Air Force Veteran who paved the way for many military women who came after her, but also because she is an outstanding small business owner who never hesitates to help others, give advice, etc.

Patra’s award is a formal award that had a formal nomination process, etc.  But how many folks do you work with who could use a little recognition themselves? Most of us these days are overworked and underpaid – that is, sadly, a fact of life.  However, most of the small business owners that I know, especially those in Alexandria, realize the benefits of promoting all of us.  We just don’t always take a few minutes to do it. What is the culture of your company?  Do you “work and play well with others”?  Do you empower your employees to act positively either to your customers or to each other, and do you recognize them when they do?  A “good job on that project”, said with genuine appreciation, can go a long way to making an employee feel good about their job.

Likewise, it never hurts to publicly appreciate the other small business owners around you.  If customers in your shop are talking about where they will go for lunch, do you encourage your employees to suggest some of your neighboring restaurants? If one of your vendors does a particularly timely or efficient job, do you take a minute to acknowledge that and thank them?  Did one of your colleagues, or competitors have a really terrific window display or put out an extra-informative newsletter this week? E-mail notes are easy and effective – brief handwritten notes are even better (and many of our local shops have very attractive Alexandria-themed notecards for a reasonable price). Let them know that you recognized their extra effort.  It really only takes a few minutes, but it will make both of you feel great!

Register for Patra Frame’s celebration at this link: https://nvite.com/BunkerBrews/eoerym

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Save yourself grief: Ask questions and seek advice

This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on February 23, 2017. Savvy entrepreneurs recognize that their expertise has limits and that they don’t know what they don’t know. Surviving and thriving depend on learning how to ask questions and knowing where to look for… Read more »

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This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on February 23, 2017.

Savvy entrepreneurs recognize that their expertise has limits and that they don’t know what they don’t know. Surviving and thriving depend on learning how to ask questions and knowing where to look for help. We hate to see businesses run into serious problems that could have been prevented with a simple conversation.

From their earliest business concept, entrepreneurs benefit from objective feedback and learning about approaches they might not otherwise consider. The Alexandria Small Business Development Center has expert consultants who are adept at identifying problems that even the best of plans might overlook.

Careful planning is always enhanced by a fresh perspective. With comprehensive feedback at the earliest stages, strategies become much better defined. Best of all, services at the center are without cost, so precious resources are conserved for other startup and growth expenses.

During these early-stage consulting sessions, entrepreneurs often learn about issues that require further research. These include zoning or other locational considerations, licensing, permits, and potential restrictions. Forewarned of these requirements, entrepreneurs can make better plans with fewer expensive surprises.

The City of Alexandria has designated small business facilitators to help entrepreneurs with preliminary and detailed planning — hopefully before leases or other obligations are signed. Their focus is on helping people through permitting and licensing processes. They can be reached at 703-746-4213 or 703-746-4268.

The Alexandria Economic Development Partnership’s expert staff is familiar with the city, the real estate market, rental rates or sales comps, and can assist businesses with the site selection process. Its services are free and an essential stop before anyone considers, much less signs, a lease.

Additionally, the small business development center has further leasing guidance and a Leasing Checklist on its website. Both economic development and small business center staffs are able to advise entrepreneurs on Alexandria neighborhoods, their civic and business groups, and how to make the best entry with their business.

Financing is another area where entrepreneurs often need expert advice before making a formal application. Every application you make could affect your credit score, and being declined reduces your prospects with other lenders.

Meeting with the small business center’s business analyst — a former banker — can help strengthen your presentation to a loan officer, much like being coached before an interview. The earlier that preparation takes place the better.

There are other professionals whose expertise will save new entrepreneurs many headaches — and dollars — if they are consulted early on. Attorneys and accountants should be part of your management team from the start.

Human resources consultants can help you avoid potential pitfalls as you start hiring employees. Marketing professionals can advise you on your branding and social media presence. The SDBC keeps lists of reliable professionals for a broad range of small business matters and it can advise you where to get help for a variety of circumstances. Feel free to contact us for referrals.

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The 11 Basic Rules of Window & Interior Merchandising

Several days ago, visual merchandising expert DP Miller presented a workshop at the Alexandria SBDC on the 11 Basic Rules of Window & Interior Merchandising.  The speaker stressed that you must know the rules, and the reasons behind them, before you can “break” them.  This is the first of a three-part series on this subject… Read more »

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Several days ago, visual merchandising expert DP Miller presented a workshop at the Alexandria SBDC on the 11 Basic Rules of Window & Interior Merchandising.  The speaker stressed that you must know the rules, and the reasons behind them, before you can “break” them.  This is the first of a three-part series on this subject – upcoming sessions will occur in April and May and will go into more detail of the practical steps to be taken to have impressive displays.  More information about these sessions and registration will be listed on our events page.  A brief summary of the rules follows:

Rules 1 – 3 – The Relationship Rules

  • Rule 1 – Approachability: Avoiding the Wall
  • Rule 2 – Psychological Perspective: Removing Virtual Obstacles
  • Rule 3 – Shopability: Making it Easy

Rules 4 – 11 – Practical Merchandising

  • Rule 4 – Dynamic Presentation: The Waterfall Effect
  • Rule 5 – The Golden Pyramid: Giving and Playing with Height
  • Rule 6 – Repetition: Of Color, Shape, or Item
  • Rule 7 – Graphic Use of Color: To Pop, Contrast, or Playing with Shade
  • Rule 8 – Negative Space: Finding Rest in the Void
  • Rule 9 – An Odd Rule, or the Rule of Odds: Couples can be Boring
  • Rule 10 – The Golden Rule to Understanding Visual Weight:
    • Short to Long
    • Light to Dark
    • Left to Right
  • Rule 11 – One Less Line: Avoiding Visual Noise

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How Is Your Business Doing?

So, you have had your small business or nonprofit organization up and running for at least a few months and someone asks you how your business is doing.  Do you have a response – and no, “Fine” is not a response.  At this time of year when people are working on their tax returns and… Read more »

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So, you have had your small business or nonprofit organization up and running for at least a few months and someone asks you how your business is doing.  Do you have a response – and no, “Fine” is not a response.  At this time of year when people are working on their tax returns and renewing their business licenses it is important to ask yourself if you really have a handle on how you are doing.  It often takes a while for small businesses to be profitable, but business owners need to keep track from the start to understand their situation.

Do you know how many customers you had last year?  Your total sales?  If your business is a consultant or government contractor, you may have had only a few rather significant clients, and these responses may be easier to give.  If you are a retail, restaurant, or personal service business with many customers you should be able to pull this information from your point-of-sales system – do you know how to do that?  Other Business-To-Business firms, or Business-to-Consumer companies should also have systems in place, through QuickBooks or a similar product that can give business owners the information that they need to make good decisions.  Many small business owners have an accountant or bookkeeper who manages “the books” and does the taxes.  However, as a business owner, it is important that you review what they have done and understand it.  Remember that help is available from your SBDC in areas such as cashflow analysis if you are not sure about your company’s finances.

As mentioned at the end of last week’s blog, it is also important to measure your marketing campaigns.  Do you ask your customers how they found you?  Have you activated and regularly use Google Analytics and similar programs to measure how successful your website, social media and ad campaigns are at bringing in customers?  Remember that an informed business owner is more likely to be a successful business owner, and make it a point to measure and understand your business operations!  You want to be able to respond to the question in the title with “Great – we doubled our profits this year” or “we expect that our current marketing campaign will finally put us in the black”, and not “I don’t know”.  Ask questions, set up your systems, and be informed!

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Marketing Trends for 2017

Recently, the Alexandria SBDC presented their annual Marketing Trends Workshop, featuring Maurisa Potts of Spotted MP (Marketing + Public Relations).  Among the trends that were highlighted for the upcoming year are the following: Interactive Content – Get people participating in your business even before they are a customer. Interactive content includes activities such as polls,… Read more »

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Recently, the Alexandria SBDC presented their annual Marketing Trends Workshop, featuring Maurisa Potts of Spotted MP (Marketing + Public Relations).  Among the trends that were highlighted for the upcoming year are the following:

  • Interactive Content – Get people participating in your business even before they are a customer. Interactive content includes activities such as polls, surveys, infographics, brackets, and contests.
  • Visual Content – Over 90% of marketers believe that visual content is essential for 2017. Content can be in the form of video, infographics, photos, chats, GIFs or Memes.  It is important to establish a content strategy and budget for crafting visual content.hand-1148981_1920
  • Influencer Marketing – Who are the thought leaders in your industry who establish credibility through social and traditional media outlets? Remember that a brand is no longer what we tell the customer it is – it’s what customers tell each other it is. Who is blogging in your industry? Who has the FaceBook, YouTube, Twitter, and Instagram followers and what are they saying about your business?
  • Embrace Mobile Video – It is here to stay! Make sure that the content you put out is mobile-enabled, and capture the metrics by views, reach, and reactions.
  • Live Broadcasting will continue to push boundaries with FaceBook Live, Periscope, and Instagram stories. Be strategic on when to use live broadcasting, use a face, and keep it short and meaningful.
  • Virtual and Augmented Reality – Businesses are testing how to use virtual and augmented reality to drive business results. How can you use these to create a differentiated, personalized customer experience?
  • Keep it short! – Content that is short in length, such as video clips, can appeal to internet surfers’ limited (8 second) attention span. Check out Snapchat, Vine or Instagram stories. Remember to keep it simple and use images.
  • Personalized Marketing – Consider leveraging data analysis and digital technology to deliver individualized messages and product offerings to current or prospective customers.
  • Direct Marketing – Remember that this is still an important tool, used in over 50% of marketing campaigns and still growing. It is important for your direct marketing materials to include pictures and to be targeted to your ideal buyer.
  • Test and Measure! – Above all else, pay attention to what works and doesn’t work for your business and your market. Set up metrics goals for marketing initiatives and track your conversions.

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The Business Plan: The imperative to stay current

This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on January 27, 2017. Over the past year, there was considerable discussion about the impact of online competition on Alexandria small businesses. To be sure, Amazon and other online retailers give shoppers options that force our… Read more »

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This post is written by Bill Reagan, Executive Director of the SBDC and first appeared in the Alexandria Times on January 27, 2017.

Over the past year, there was considerable discussion about the impact of online competition on Alexandria small businesses. To be sure, Amazon and other onlibusiness-man-1031755_1280ne retailers give shoppers options that force our small business owners to up their game.

Often, that means providing legendary service or expertise, or a hands-on experience that lures shoppers away from the at-home convenience of point and click.

Small business owners must stay attuned to the latest trends, technologies, fads and fashions. Even more intently, they must follow their particular business niche to see what others are doing — all around the world.

Ideally, this is something that so excites the owner that they can’t help snooping for more ideas. But if this research is beyond their comfort zone or schedule, then it’s time to engage friends or family to do it for them, or hire the expertise. It simply has to be done.

The hallmark of entrepreneurship is constantly living in the shadow of things that need to be done, while not necessarily having the skill set or adequate time to do them. Here are some suggestions to broaden your horizon: become active in your industry and search pertinent journals; attend gatherings of fellow business owners and talk candidly with them to exchange tips and tricks; and pursue social media discussions. Business sections at public libraries and online searches might turn up other ideas.

Staying current does not just apply to your commercial niche. It also requires you to be vitally aware of what’s going on around you, both in the nation and in the region. Whether or not you’re a newshound, you’re a much savvier entrepreneur if you’re tuned-in to current affairs.

It’s essential to become engaged in your community. Whatever media you prefer, you need to actively use all avenues to keep abreast of active issues, and particularly ones that impact businesses.
Community newspapers and Alexandria’s eNews and Point.Click.Connect email bulletins help fill in the details. Business and civic organizations, commissions, economic development activities and city government departments periodically hold information sessions.

These public issues are complex and cannot be fully captured in letters to the editor. It is vital that you become involved in the texture of the community, learn the details, and provide candid and constructive feedback.

The city-funded economic development programs — the Small Business Development Center, Alexandria Economic Development Partnership, and Visit Alexandria, have websites and programs to inform or educate business owners, help them improve their operations and marketing, help them solve problems or help them make vital connections.

The persistent challenge is that so many of Alexandria’s businesses are not connected with these free resources, and too many businesses are not even connected with one another.

Alexandria has so much going for it. Recent consumer surveys show that shoppers much prefer doing business with independent merchants rather than big box retailers. They also look for a sense of place and authenticity. Alexandria is all of those things in spades. It’s time to connect and become part of your business community.

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