Saturday, April 04, 2020

Welcome to the "Not My First" Rodeo

Like most of you, I've spent a lot of time on Zoom in the last week. And it's hard not to talk about the economy - and speculate about where it's going. Are we in a recession? Technically, no. But we will be soon.

So the big questions are: What will you do? What will your clients do? How can you stay in business without taking too much money from your clients, since you also need them to stay in business?

And so forth, and so on.

I also noticed this week that the people who owned a business that survived the last big recession have a very different approach to the uncertainty than those who don't share that experience. They don't have any more certainty, but they seem to have a lot less stress.

I had a bit of luck in the 2008-2009 recession (I had raised my rates early in 2008). I also had some bad luck due to clients downsizing or being gobbled up by their competition. I made some mistakes, and I made some good decisions.

Overall, I probably did as well as anyone else who kept their business alive at the time.

We Know Some Things

I also learned a lot in the last recession. And that knowledge helps me be a little more at ease this time. I still don't have a crystal ball, but I do have a pretty good idea of the "stages" we need to go through. That's why my last blog post encouraged you to go get all the money that's owed to you right now: The next thing that's going to happen is that some people will stop paying their bills.

After that, there will be layoffs. You might have to lay off some of your staff. Your clients will certainly have some down-sizing.

People who rely on recurring revenue will now have the best cash flow. Use it wisely. Those who trade dollars for hours will see work disappear much more quickly. As everyone begins to hoard cash, discretionary spending will decrease. If you are "discretionary spending" then your work will decrease.

Some businesses will cease to exist. Talking to other people in this industry, there's general agreement that about 25-30% of all IT service providers disappeared during the last big recession. Some closed their doors intentionally. Some sold their businesses to the competition. Some just took jobs when they could find them.

I don't know if we'll see that much drop off this time, but I'm sure we'll see some.

. . . and then one day, without any notice, things will begin to improve. Old clients will call and ask for a quote. The number of tickets in your system will creep up. Sales will slowly appear. And eventually, things will become the new normal.

There's Plenty We Don't Know

There are also plenty of unknown factors. We don't know how deep or how long the drop-off will last. I also survived the 2001 recession, which was almost entirely an implosion of an over-sold stock market. The underlying economy was still strong, and we got back on our feet very quickly.

Until February, we were in the middle of a massive mergers-and-acquisitions feeding frenzy at all levels. IT consultants were gobbling each other up. Vendors were gobbling each other up. Private equity companies were gobbling up everything they could find. THAT wasn't the case in 2008.

Some of these companies are well run, have a long-term vision, and will be partners you'll want to keep when the storm has passed. Others will focus 100% on their bottom line without regard for their "partners." You might drop them during the recession or shortly after.

Some vendors and distributors have lots of cash. That gives them lots of options. We'll see what they do with it.

Another "new" element this time is the level of information we have about our own industry. There are blogs and podcasts that call out vendor missteps and praise vendors who do the right thing. I think (I hope) this will help vendors who are on the fence to come down on the side of helping partners survive.

The Bottom Line

In the end, we all should know this: The recession will end. It will run its course. With luck, the virus will fade away and we'll all get to get together at a conference. We just don't know when right now. But it will happen.

You may have never gone through a recession as a business owner. That's okay. After all, it's not something you'll look back on fondly anyway. BUT you can rely on the advice of those who have successfully trod this path. In the natural progression of the universe, many of these survivors are now bloggers, authors, podcasters, and coaches.

Listen to their words and watch their actions. But remember that you are an economy of one. That means that you need to focus on taking the best actions for your business. Don't assume the that national economy (or world economy) is your economy. Your economy exists only inside your Profit and Loss report. Trends and the actions of people outside your business are a source of information. You still need to make the right decisions inside your business.

Each client interaction is the one opportunity you have to keep that client. Each staff interaction is the one opportunity you have to build your company culture. Each new prospect is the one opportunity you have to make a sale today.

Stay focused. Stay informed. Make good decisions.

I sincerely wish you the best luck possible in the months ahead.

:-)

Thursday, April 02, 2020

Why the Absolutely Unbreakable Rules Matter: Getting Paid in Advance

Many people have heard me speak about the Absolutely Unbreakable Rules for success. These are, basically, the rules I've learned over the years running various businesses.

These are not "nice ideas" or good thoughts. They are absolutely unbreakable for one extremely important reason: If you adopt these rules, you will not have to change them when hard times come. These rules don't change because there's a virus, a recession, or when you lose clients.

And like all good advice, it would be really great if you put the advice into effect before there was an economic downturn.

I received a timely email yesterday from Stephen. He asks, "In your book, you recommend taking credit card payments monthly, or a check for 3 months at a time. I did not see where you explain why 3 months. Is a monthly check not recommended for some reason?"

Here's how I interpret that: One of the most important rules for running your business is

Get paid in advance for everything.

Why? Well, there are lots of reasons. The most important reason is that people stop paying their bills sometimes. And sometimes can suddenly become right now when there's an economic downturn.

Guess what? Right now is right now.

January 1: The worlds was happily moving along and the stock market was headed for an all-time high in mid-February.

March 31st: The stock market had it's biggest drop in history and unemployment filings are higher than at any time, ever.

It is going to be much harder to collect money this month than it was last month. And it will be much more difficult next month and the month after that. What can you do?

Get prepaid for everything you can.

Here's what I told Stephen in response to his question:

"There are a couple of reasons for the three-month check. First – and this is going to start happening right now because of the economic downturn – People who write a check every month will begin paying later and later. First a day or two. Then a week. And eventually 30 days late. 
Second, and very related, we are trying to move to getting prepaid in advance for everything. That’s easy with credit cards and difficult with checks. 
In a recession, lots of people will be hoarding their cash because they don’t know what will happen to their business. You need to do that, too. These policies make that easier and limit your losses."
- - -

Here is my very urgent advice to you: If you have accounts receivable, make collection of this money your absolute highest priority.

Second, as soon as possible, adopt a policy of getting paid in advance for everything you do. Period.

One of the sad truths of business is: Money owed to you is almost never collected in full.
Corollary: Old money owed to you is never collected in full.

I can't believe that people still argue with me about whether they should take credit cards. The answer is easy. Yes. You should take credit cards.

Their complaint? "But I have to pay [almost] 3% to collect that money."

Well, for those who don't take credit cards, today is the day you get to learn a very hard lesson. You will begin trying to collect money and realize that it's much easier to NOT pay a bill than it is to collect a bill. You will call people, write them letters, and beg them for money they owe you.

Sadly, some of your "good" clients and friends will simply not have the money they owe you. They will lie to you. They will say that they sent a check just to get you off the phone. They will dodge your calls and hide if you show up at their office.

Eventually, you will settle for something instead of nothing. You will take 75% of what they owe you. Or maybe 50%.

You'll do anything to collect that money.

. . . and it's going to cost you a lot more than 2.9%!

- - -

When it's all over, you're going to sit down and ask yourself, "How can I make sure that, no matter what happens to the economy, I will get paid for everything I do?" And the answer will be: Get paid in advance for everything.

That will become a policy. It will work its way into your business processes. It will not be negotiable nor flexible. It will become an absolutely unbreakable rule. And no matter what business you are in, you will not have to learn this lesson again.

Many economic lessons are only acquired by paying tuition in full. This is one of those lessons.

Go get your money.

And start requiring payment in advance from now on.

:-)


Wednesday, April 01, 2020

Your Constant Challenge: Work-Life Balance

A note for entrepreneurs.


One of my first books is called Relax Focus Succeed. It’s all about balancing your personal and professional lives and being more successful in both.

This balance is always a challenge. Everything in your life and business changes all the time. So you need to keep working on balance forever.

What does that mean? Ideally, it means that you consciously create your business – and re-create your life – so they are completely in synch. You need time to work, time to play, time with your family, time to work on your personal self, and time to recharge your batteries.

I know all that sounds like an impossible balance, but it is very manageable if you plan it out and work to make it happen. It might take years to achieve a sustainable, healthy balance, but it absolutely is possible.

Stress and exhaustion really do kill people. Build sustainable habits and you will be able to practice them forever.

It may seem impossible to imagine now, but you can create a balance between personal time, family time, and work time that allow you to have the best of all worlds. Most people never achieve this balance for one simple reason: They never try.

Creating work-life balance takes a great deal of time, attention, and work. If you start your business with the intention of creating this balance, and fine-tuning it forever, then you can create a successful balance that improves every part of your life and work.

:-)

Friday, March 27, 2020

SMB Books moving to a new site: Get your downloads now!

After eight years on our current platform, SMB Books is moving to a totally new web site.

But if you're one of the 11,000 people who has purchased from us in the past, you need to make sure you have your downloads !!!

If you have ever ordered from our book store - SMBBooks.com - please read this email.

We will be moving to a new platform soon. PLEASE make sure you have downloaded the handouts, PDFs, and audio programs from the old site before we shut it down.

Here’s how to get your downloads.


  1. Go to www.smbbooks.com. Scroll down and select the “Sign In” option. Log into your account. If you didn’t set a password, you can simply request a reset.
  2. Under “My Account” click on “Review orders / track packages”
  3. Click the Download Files link
  4. Click the file name to begin the download


Screen shots below.

Let me know if you have troubles.





-- -- --

Our old site served us well
. . . for 11,000 purchases!

But it is now old technology and more expensive than it needs to be.

As we have moved many people to our Small Biz Thought Technology Community, we have dramatically decreased the traffic on the old site (because members get access to pretty much everything inside the Community).

Thank you for all your support over the years! Please take care of this.

:-)


Wednesday, March 25, 2020

Manuel's Economic Storm Survival Guide

My brother Manuel is putting on a webinar to help IT consultants caught in the "economic storm" that's forming in response to the Covid-19 virus.


March 31st
2 PM Eastern / 11 AM Pacific

Register at: https://manuelpalachuk.com/survival-guide

Everyone already has a myriad of Coronavirus checklists and How-To-Work-Remotely best practices, but who’s helping you understand the economic implications of what’s happening and how to survive it?

Manuel is!

Sign up here: https://manuelpalachuk.com/survival-guide

#GettingToTheNextLevel

:-)


Tuesday, March 24, 2020

Is Your Family Ready for You to be Self-Employed?

A note for absolutely new entrepreneurs.


If you have a family, you need to consider whether they are ready for you to make the launch into self-employment. It’s great that you are excited and have faith in your future. But a new business can be very difficult on a family.

Many new business owners un-balance their lives terribly. They believe they need to take every customer who walks in the door. They tend to work very long hours, leaving almost no time for their family.

This behavior compounds until something blows up. And that something is often the most important relationship in your life.

Take this very seriously. It’s important to talk about the long hours, and the struggles ahead, and all the things you’re not sure about.  When a partner knows what they’re getting into, it is much easier for them to support you when the going gets tough.

It’s also a good idea to set some limits on your work time. You need to have balance in your life if you’re going to make this business work in the long run. You need to spend time relaxing and recharging your batteries.

And remember: The more you talk about all these things with your partner, the smoother everything will go – the first year and every year after.

:-)

Wednesday, March 18, 2020

How to Help Your Clients Thrive During the Economic Downturn

Now's the Time for Client Roadmap Meetings!

I went "live" today on Facebook, talking How to Help Your Clients Thrive During the Economic Downturn.



That's here: https://youtu.be/LRcmUXs7pQw

Now is the Time: Help Your Clients Make Good Decisions!

I have a few resources to make your life easier. First, if you need a place to start creating a Client Roadmap meeting, my 3rd edition of the 68-Point Checklist will help (It's free). You'll want to add some business and strategy questions to create your Roadmap Questionnaire.

For more information on that, here are some previous blog post links:

- https://blog.smallbizthoughts.com/2006/10/technology-roadmaps-for-clients.html
and followup https://blog.smallbizthoughts.com/2007/06/roadmap-update.html

Plus an SOP Friday post:
SOP Friday: Quarterly Roadmap Meetings

And a Client Roadmap video: https://youtu.be/b7ejd35XzcQ

As your clients tighten their belts in the months ahead, you need to jump in and help them save money and increase productivity through the appropriate use of technology. That includes helping them create a secure remote working environment.

When this downturn is over, you want to be remembered as a partner who helped them make the most of the situation.

-- -- --

If you're a member of the Small Biz Thought Technology Community, you have free access to the three-part mini-course. This includes my brand new 14-page Technology Roadmap Questionnaire. It also includes a four-page white paper on how to get the most out of the Client Roadmap Process.

Mini Class – Client Roadmap Deep Dive

Part One is an overview of the process and a deep dive into the questionnaire itself. Why do we ask these questions, where do they fit, and why do it in this order? We also talk about why you shouldn't worry about finishing all the questions. You probably won't, and that's great.

Part Two, we talk about using the Roadmap Questionnaire to close new clients. It's a very smooth transition from the 68-Point Checklist and a network assessment to a discussion about the client's business more broadly. We'll also touch on the first Roadmap meeting after you sign the client.

Part Three covers the ongoing, never-ending conversation you'll have with your clients about their technology. You'll see how we use this to get the client to engage in the overall health of their network, to make good decisions, and completely sidestep the sales process going forward.

Get sticky. Make clients love you. Improve their technology. And eliminate ongoing "sales" while selling lots of great stuff. It's not quite magic. But it's pretty close.


If you're NOT a member of the Small Biz Thought Technology Community, you should be. We have massive resources like this -- Everything's included.

Visit https://www.smallbizthoughts.org.

:-)

Tuesday, March 17, 2020

New Class: Core Standard Operating Procedures for Small IT Providers

Core Standard Operating Procedures for Small IT Providers – W501

Taught By: Karl W. Palachuk

- Five Tuesdays

- March 24 - April 21

- Register Now!

- All classes start a 9:00 AM Pacific

- All classes are recorded

You're guaranteed to learn something that will make or save you the price of admission!

This course will cover the most important procedures you need to have in place to run an efficient and highly profitable Managed Services Business.

Whether you're a new Computer Consultant or an experienced Managed Service Provider, you need to create successful processes that will propel your company forward. Nothing is more critical to making profit than having the right processes and procedures in place!

When I take on new coaching clients, they have many of the same issues over and over again. And almost all of them boil down to SOPs - Standard Operating Procedures. Or the lack thereof.

Everyone knows you need SOPs. In fact you probably know which ones you need. But where do you start?

You will learn:

  • A practical introduction to SOPs
  • The relationship matrix of SOPs
  • Clients
  • Employees
  • Vendors
  • Internal Organization
  • The Ten Most Important SOPs for your IT Consulting
  • Business
  • SOPs management, organization, and updates
  • Implementation strategies internally
  • Implementation strategies for clients
  • Service Department SOPs
  • Building
  • Training
  • Deployment
  • Upkeep
  • Avoiding the biggest pitfalls with SOP development and deployment
  • Building an Action Plan that works


This class is filled with great advice and tips on running your I.T. company and moving into the world of recurring revenue with cloud services.

Delivered by Karl W. Palachuk, blogger and author of the very popular "SOP Friday" posts at http://sopfriday.com.

Includes five weeks of webinars with related handouts, assignments, and "office hours" with the instructor. All classes are recorded for download.

This course is intended for business owners and managers. It is particularly useful for the Service Manager or Operations Manager.


per person

-- -- --

Small Biz Thoughts Technology Community Members: Register for only $99. See the Deals and Freebies forum for the code you need.

Members with annual subscription attend for FREE. Email the Community Concierge to get started.

Details at https://www.smallbizthoughts.org.

:-)

Monday, March 16, 2020

You Don’t Have To Get It Perfect the First Time

A note for entrepreneurs.


Many people are stymied by the mistaken belief that they have to “get it right” before they implement decisions. This includes small decisions as well as large ones.

I encourage you to take a different approach: Accept that this is an iterative process. That means you will tackle the same decisions again and again. Eventually, you will get good at making decisions. The sooner you give up believing in perfection, the sooner you can learn to make decisions quickly, without fear of being wrong.

Consider your business five or ten years from now. You will have run many marketing campaigns. With each one, you will learn something about what works and what doesn’t. And, ideally, each campaign will be better than the previous.

The same is true with your price lists, your offerings, your strategies, and everything else in your business. Everything changes, all the time. It is simply impossible for you to keep doing exactly the same thing all the time.

So, you see, every decision you make in your business will be revisited at some point.

So just remember that  you need to go through this process, but execution is far more important than getting it right the first time.

The Japanese have a management process called Kaizen. It means constant, incremental improvement. Embrace that philosophy and relax: you have forever to get it right!

I promise you'll make mistakes. And you'll get over. With luck, you'll learn and move on.

:-)

Saturday, March 14, 2020

Not Cancelled: Robin Robins' Big Boot Camp

Update March 16th: This event has gone virtual. Same link.

----- -----

Robin Robins has announced that she is holding her "Big Show" as scheduled:


The theme for this year is The IT Sales and Marketing Fight Club.

Special guest this year: George Foreman!

Nashville, TN
April 8-11, 2020

Details at https://www.robinsbigseminar.com/

DEALS:

1) Given the circumstances, Early Bird pricing has been extended to April 8th! Visit that web site for details.

2) If you are a member of the Small Biz Thoughts Technology Community, please contact me. Robin has given us a handful of free tickets to the first few Community members who contact us.

Let me know if you're interested. We’ll contact Robin’s team and make sure you work out the details. 

If you haven’t been to this event before, it is always an amazing event! Details and information at https://www.robinsbigseminar.com/

:-)