Regarding my upcoming book, Company Growth by Acquisition Makes Dollars & Sense, a good friend asked me why I bothered having a print edition, implying most book sales are now electronic. I answered it was because most of the sales for my two existing books are the print versions.
And, according to the Association of American Publishers, as recently noted in the Wall Street Journal, last year printed book sales grew by 4.5% while e-book sales declined by 17%. Maybe there’s a reason why Amazon is now opening brick and mortar stores. Could it be for all those printed books people are buying?
Preconceived notions can be dangerous. No, they’re usually dangerous.
- I’ve heard people question why they should do a marketing action because, “It didn’t work for someone I know,” ignoring the fact it’s worked for most other people.
- Business buyers constantly make judgments about target companies with only high-level information. I tell them to ask (about everything).
- Salespeople wonder if they should call prospects, so they don’t.
This isn’t like fake news, it’s rushing to judgment, and because of it we make mistakes or miss out on opportunities.
“The other day I was thinking, ‘I just over-think things.’ And then I thought, ‘Do I though?’ ’’ Demetri Martin
The big news in the NFL earlier this year was the best player in the NFL, Aaron Rodgers, was injured and will be out at least eight weeks. I was listening to a press conference as his coach described how they weren’t going to go after a veteran quarterback to replace him, how he had two and three years invested in the quarterbacks on the roster, and felt comfortable moving forward with them.
Then a reporter asked him if he would try to sign Colin Kaepernick. The room took a sudden chill as the coach glared at the reporter and said, “Didn’t you just hear my answer to the previous question….?”
A brilliant example of when people are so busy thinking of what they’re going to say they don’t listen to whomever they’re speaking with. At a recent conference, we discussed building a relationship, as soon as possible, when you meet someone. And a great way to do this is to listen and ask intelligent questions related to what the other person says.
A great illustration of this is when, after a 15-minute conversation where the other person talks for over 13 minutes, they tell you how you really understand their situation or their business. It’s why I tell business buyers and sellers they have to get to know, and like, the person on the other side of the transaction. And you start the process by listening.
“Silence is the ultimate weapon of power.” Charles de Gaulle
Reading about the University of Washington’s big victory over rival Washington State I noticed the following from UW defensive coordinator Pete Kwiatowski, “When you beat the guy across from you, it’s a simple game.”
It always comes down to doing the basics. As I’ve told my clients for years (and mention in my book, Buying A Business That Makes You Rich) when you do the things you’re supposed to do, good things happen.
For business buyers, this includes implementing a comprehensive search system, building a relationship with the owner/seller, realizing the vast majority of sellers care about their employees and legacy, and recognize you want to pay a fair price for a great business.
For business sellers, the number one overriding “simple thing” is making sure your business is ready for the buyer’s in-depth analysis. My top four things are – show growth, reduce dependencies (especially on the owner), have solid financial systems and accurate financial statements, and demonstrate how you attract and retain great employees.
And for increasing sales, whether you’re an advisor, banker, business owner, or employee, it comes down to constantly and consistently getting the word out about the value you provide. You may set a goal of increasing revenue by 18% but if you don’t market, make telephone calls, or see people how the heck will you achieve your goal?
Here’s a good way to lose customers. Change their agreement, which renews annually, without telling them and have the new agreement greatly reduce the customer’s benefit.
This happened to me with my executive suite. I’ve been with them almost 10 years and found out in November how my August renewal dramatically changed what I get. No notice, nothing.
A large corporation bought the locally owned company a few years ago, I was waiting for rate increases, and figured they’d at least tell me in advance. I have to “not renew” with three-months notice but they don’t have to notify me of changes.
I’m in the market for a new executive suite.
The Wall Street Journal recently published an interesting article on how banks are reducing the number of branches. They explained how Bank of America, using Indiana as the example, is overall reducing the number of branches but the steep cuts are in small towns as they add branches in Indianapolis, especially the more affluent areas of the city.
If we look at car dealers, we see the (ever shrinking) auto section in the paper doesn’t have ads for Lexus, BMW, Acura, Audi, etc. The ads, shouting out low prices, are for Ford, Chevy, Hyundai, Dodge, and similar.
In both cases it’s using data to reach the target customer. The same techniques should be applied to small business, even though most don’t have anywhere near the money or data to fine-tune it as much as big business can. It comes down to knowing where your customers are so you can reach them most effectively.
The same holds true in business buy-sell. Sellers need to know who their best buyers are (the logical buyer) as a quality buyer is worth more than a higher price (a buyer recently lost a deal when someone offered more money and now the seller wants to reopen communication because the higher price came with baggage, that being a not very good buyer).
Buyers need to know what they want, not, “I’ll know it when I see it.” This means a lot more than business type but understanding how they will fit into the operations. For example, a manufacturing engineer is probably not going to be good with a pure sales organization, and a sales guru won’t do well running a process oriented manufacturing business.
Know what you want, who your customers are, and go after them in the best ways possible.
My wife has been visiting our daughter in Baltimore a lot to help with a new baby, three trips in three months. She now has her own “driver service,” someone she met through one of the ride share companies whom she now books direct.
On the radio last week, I was listening to a discussion about how an Airbnb host gave a guest their phone number and said it would be cheaper to book direct.
I’m sure Uber, Lyft, Airbnb, and others plan for some circumventing of the system. It’s not ethical but I’m not sure what they can do about it as the drivers and hosts are independent contractors, not employees.
And I’m guessing there are other issues related to the above including proper insurance, which I believe the parent companies insist on, reliability, and, in Seattle and other places, the push to allow these drivers to unionize (can you unionize someone completely independent?).
All businesses have issues as there’s are no perfect businesses (and in the buy-sell world, no perfect deals). The more business models evolve, the more (new) issues arise.
Small business owners can be isolated, which is why there are facilitated, peer-to-peer roundtable groups, advisory boards, and business coaches. It’s important to have someone who will ask you tough questions, tell you when you’re off base, hold you accountable, etc. To see more on this watch my video, “A Sounding Board = More profit” https://youtu.be/OAawNZYwmpk
The other day I was on a conference call and heard a business seller give a very eloquent explanation of why he wants to sell his business to a particular buyer. He mentioned numerous things, including he’s a good person, he’ll preserve the culture, we share values, I don’t want to sell to a large company, etc.
Every year there’s at least one deal where this happens (the extreme is when the owner sells to someone she likes for a price lower than someone else offered), or a buyer says he won’t negotiate much because he really wants the business, one reason being how much he likes the seller and what the seller has done with the company. Buy-Sell is a microcosm of all business and life, i.e. relationships are the most important thing there is.
I (over)emphasize this in my books, Buying A Business That Makes You Rich and If They Can Sell Pet Rocks Why Can’t You Sell Your Business (For What You Want)?). Small and mid-sized business transactions won’t happen if the buyer and seller don’t get along. Getting along great doesn’t mean there’s a deal, it means you have the potential for one.
Just like life, right? We hire people we relate to, we hang around with people we like, we date and marry people we get along with.
Many years ago, I learned a lot from a program called “Counselor Selling.” Having never been in anything close to sales before it opened my eyes to how important relationships are. Want to do business with someone, build a relationship before talking about product.
A few months ago I bought a new desktop computer (I still like the big screen with a second monitor so I can have four to six programs visible all the time). My old computer was a workhorse but was really slowing down, which always seems to happen as all software and websites get more and more complicated (for example, I don’t know why Office 365 needs to upgrade every week or two with hundreds of megabits).
But the point of this memo is how easy it now is to upgrade and get the new computer fully loaded. I made a backup copy of the hard drive to Time Machine, plugged the external hard drive into the new computer, and restored it. A few hours later everything was there and working. As far as I could tell, the only thing that didn’t transfer was my rules in Mail (and it was probably human error). It was very customer friendly.
On the other end of the ease-of-use spectrum is getting my office phone line to forward to my mobile phone via the website or the app on my phone. The app constantly doesn’t load this feature and the website takes what seems like forever to find the right page (then it’s easy).
I think about this as I ponder my business and the businesses of my clients. How easy is it for others to work with you? I probably put off getting the new computer for at least a few months fearing the disruption. Are people putting off working with you because they fear the process? Let’s hope not.
“To make anything interesting you simply have to look at it long enough.” Gustave Flaubert
It doesn’t take a lot of effort to find examples of poor customer service. It’s all around us and one has to wonder why management and ownership can’t see it.
We were on vacation and late on a Saturday afternoon stopped at a small-town supermarket, one as big and nice as 90% of those in big cities. Plus, it’s part of a regional chain. We got our stuff and headed to check out only to see we were about number eight in line, with only one check stand open. Within a couple minutes there were at least four more people behind us.
My wife unsuccessfully tried to find someone to open another line. I then found a guy stocking shelves, who obviously didn’t like the fact that at his age he was stocking shelves on a Saturday evening, who told me, “That’s not my job.” I asked if he could find a manager to get another line going and was told, “No.” He also told me to find a manager I needed to go to the customer service desk, which I did but it was not staffed.
This town has two very nice stores. Guess which one we’ll be going to exclusively from now on?
It’s not that hard to educate people on how the customers come first. Maybe it was just a bad apple employee I met but I know from our local stores it’s not that hard to get employees to help you get you what you want (other than in the big box home improvement stores where the most common answer is, “It’s on aisle X on the right”).
They did open another line about 10 minutes later.
A while back I read an article about how the staff at Tesla can’t keep up with all the visionary ideas Elon Musk and his team have (and announce). It seems a lot of what’s proclaimed isn’t close to being ready, technology wise. Much like a politician making promises and then facing reality.
This is nothing new. T here’s a fascinating historical novel by Graham Moore, “The Last Days of Night,” which is about the late 1800’s battle between Edison and Westinghouse on the light bulb and electrical transmission systems. Ideas are often ahead of technology, now, in the 1800’s, and before.
In small business, you have to be careful not to do too much too fast. This especially applies to new owners, after a business acquisition. Full of ideas and energy, it can be tough to take the time to learn the business. Most employees are still feeling out the new owner and big change can be disruptive.
I know in my business I constantly get new marketing ideas, outline them, set up tentative plans, and then realize I have to pace myself. I can’t ignore what’s worked for me over the years, I have to blend the new with the existing.
Speed is important. Urgency matters and can make a big difference between getting what you want or not getting it. A client recently lost all chances of a deal because he stalled for a month making sure everything was perfect. At the same time, you have to be prepared so when you move you’re ready, at least 80% ready (there’s a reason Pareto’s Principle is valid after all these years).
“Life is always a tightrope or a feather bed. Give me the tightrope.” Edith Wharton