Q: We recently had an issue where a vendor refused to pay an invoice. There were no complaints about the service. Their stated reason was a matter of the vendor’s employee who made the agreement failing to get authority. It was frustrating because a quarter of a billion dollar company that made thousands of dollars off of our promotion refused to pay our $600 fee. We brought 400 customers into their store and watched them ring up dozens of high-end sales. We learned a lesson and will now require prepayment before executing a promotion. But, what should we have done? $600 is not worth suing over. We don’t want to create bad blood. But, they took advantage of us. When should we write something like that off as a loss and when/how should we get more assertive? Carl Ewald, www.ODDysseyHalfMarathon.com
A: As a business owner, you need to choose your battles and determine what you will consider a “lesson.” It sounds like you have done just that. Recognizing an error that could be prevented in the future and making an immediate adjustment is key to being a wise small business owner. Determine how long you are willing to “wait for payment,” what your “cut-off” (dollar amount) is to proceed with legal action or write off, make it all policy and stick to it.
Q: As other one-man business owners know, you have to wear a lot of different hats to get the job done. One of the most painful parts for me is trying to get new clients via cold calling. I hate that “telemarketer” type approach. Do you have any tips for making it easier or getting clients another way? Also, are there any good services that do the calling for you for a fee? Matthias Hager,http://www.2helixtech.com/
A: Is “cold-calling” necessary for you to connect with potential clients? An effective and efficient way to connect with clients is social media and social networking. First, contact your sphere of influence (friends, family, associates, local vendors, group members, people you talk to on a regular basis, etc.) and see if anyone has any potential leads. We are only 6 degrees of separation from those who can take us to the next level. Identify your specific audience, create a marketing message that clearly states the benefits of your product or service, find the social networking sites that your ideal clients use and start sharing relevant information, introduce yourself and make connections and start cultivating relationships. Social media is a very powerful and effective tool when planned and used properly. I can tell you this from personal experience. I’ve never made a cold call and I was only on Twitter for 6 months before I was mentioned in Forbes as one of 30 Women Entrepreneurs to Follow on Twitter. And yes, I have gotten clients from Twitter and other social media networks. However, again, it takes planning and time.
Q: I launched “THAT SHOULD BE ON A PILLOW!” for the holiday season in 2008, right after the meltdown. Not the brightest move, especially selling a “non-essential,” high-priced item. I have consistently gotten rave reviews from all of my customers by over-delivering on product and service. They don’t expect the attention to detail and craftsmanship. The orders are trickling in– 58 items so far this year. Two of which were corporate orders. I think the only way to make money at this is with multiple orders of the same design (corporate gifts, weddings, special events). The individuals who find me by Googling “custom phrases on pillows” are never going to create enough volume to get me out of debt, I net 20% per order. And shipping costs are killing me. Do you think focusing on corporate gifts would be the right move? Would firms be interested in the pillow as a gift idea that could feature a corporate credo, the CEO’s mantra, an advertising slogan, a sales lesson, etc? Are event/meeting planners a good target? Many thanks for your help. Anne Marshall, http://www.thatshouldbeonapillow.com
A: You may want to start by analyzing/profiling your previous sales. Develop a short customer survey. What exactly interested them in your product, why did they purchase from you and how did they find you? You also need to look at your client demographics. In addition, some market research on novelty items and purchases will give you some insight on other potential target markets. You may want to consult with an SEO expert to see how you could incorporate keywords like “novelty” “corporate gifts” “bridal gifts” etc. into your website. The wedding industry sounds like a viable place to market your wares as well (bridal gifts). Are there any potential collaborative partners/vendors you could connect with?
Q: I launched a new iPhone app, ✄ Fabric U ✄, a few months ago with much anticipation. This was going to be the app of all apps. The one that I could bank on, the one I could retire on…you get the idea. I haven’t had an avalanche of downloads since. What I’ve earned could pay a few bills, most of the utility variety. I’m actively promoting my app by commenting on related blogs. That’s probably the extent of my advertising. I also have a t-shirt that says, I app-solutely ♥my✄Fabric U✄ iPhone app! Anyhow, I’m working on another app, ✄Yarn U✄, which I hope will be even more popular…however, I’m haunted by the humbling lessons I’ve learned on my first app. What can I do to learn more about my audience for my first app, which I can apply to my newest product? That said, I don’t know who’s buying ✄Fabric U✄. If I knew more I could re-jigger the content even the app promotional content on iTunes. Do you have any ideas for me? Mary Beth Klatt, http://tinyurl.com/242bua9
A: I would suggest you find a way to capture nominal info (demographics) on your buyers as a starting point. Perhaps as part of the “download” or purchase process. Where are people who would benefit the most from using your application “mingling?” Are they even tech-savvy? Can you partner with another vendor who may have access to your ideal clients (i.e. Joann’s, Michael’s, local arts and crafts stores, etc.) They could add/incorporate your app into their site, marketing, etc.
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