Milwaukee Biz Blog

For small-business owners, everything is amplified. For instance, the landing of a large new account is not only a professional success, it's a personal success that can mean long-term financial security for your family.

At the same time, every setback, small or large, hits even harder. When times are tough for the overall economy, they are exceptionally tough for small-business owners.

Last month, Discover Small Business Watch found that economic confidence among small-business owners dropped to a record low. Nearly 80 percent of small-business owners thought the U.S. economy was getting worse.

With the prices of most goods rising, especially gas and food, nearly every participant in the American economy is feeling the pinch. It's unavoidably trickled down - your customers are probably looking to change behaviors and cut back. The result for you and your small business: reduced opportunities, stagnant cash flow and slimmer profit margins.

Therefore, in times like these, it's important that a small business do all it can to survive.  A little bit of innovative thinking and belt tightening can go a long way - and for entrepreneurs, this should come naturally. Here are some tips that can have a big impact on your bottom line:

• Show me the money: An important aspect of getting paid on time is clearly articulating expectations with your customers. Boldly, but respectfully, emphasize what work was done, how much should be paid and when the money is due. Consider offering a pre-payment discount or incentive.
• Tech-savvy: Use technology efficiently. Technology and frugality can go hand in hand. Consider Web-based accounting software and video conferencing. Embracing the Web can save money while simultaneously providing education on important tech advances in the business world. 
• Boost sales (while maintaining costs): Charge for products or services currently given away for free or consider raising prices. At the same time, focus on selling more to existing customers instead of prospecting for new ones.
• Market smart: Save on time, phone bills and aggravation. Try using targeted e-mail sales pitches. Additionally, spruce up the company Web site. The virtual address of a business has become more important than the physical address.
• Stay visible and helpful: Keep in touch with customers. Ask how their business is going. Confirm that you have been a helpful partner for them and then for referrals. Contact dormant customers and inquire about current business needs.
• Inventory in motion: Is inventory producing or just taking up space? Have a sale to move slow or obsolete inventory. Examine customer purchase patterns to determine if it is possible to shorten the overall holding cycle.
• Keep workers working: Cut down on unnecessary employee trips outside of the office. Purchase a coffee maker or buy soda for employees; it saves them $4 at Starbucks and the business 20 minutes of lost productivity time. Also, consider streamlining common business errands: order office supplies online and take advantage of online shipping solutions, where the postal worker can pick up packages from your business instead of your workers having to take them to the Post Office.
• Don't cut the perks: As tempting as it may be, cutting little employee perks (free coffee and bagels, holiday parties, etc.) can make people feel undervalued and potentially lead to employees leaving. The small extras tend to be taken personally. Keeping perks maintains employee confidence in your business's strength and can inspire them to go the extra mile.

In the end, it's up to each small-business owner to decide what his or her priorities are when it comes to braving tough economic times. These ideas are just a few of the many available. Thinking outside the box is part of the entrepreneurial lifestyle, when first starting a business and furthermore when guiding its growth. Adapting and overcoming the challenges of today will make your business even stronger in the years to come.

Joseph Cardamone is president of the United States Federation of Small Businesses (USFSB). Founded in 1983 by small-business owners, USFSB advocates for the rights and interests of small businesses and the self-employed.

Throughout the month of May, chambers of commerce throughout the country are recognizing small businesses for their achievements and contributions. One look at the statistics and it's easy to see why they deserve our praise.

Small businesses have generated 60 to 80 percent of net new jobs annually over the last decade, according to smallbusiness.com, and according to the Small Business Association, small-business owners represent 99.7 percent of all employer firms.

But even 15 years ago, small businesses were often limited by their geography to local or regional customers. Today, thanks to advances in technology, many of the 26 million small businesses in the United States can operate globally.

A stronger and faster Internet has paved the way for small businesses to reach beyond traditional borders. Now a store in Springfield, Ill., for example, can receive purchase orders via computer from a customer in Oslo, Norway, who read about the product on a blog.  Today's savvy small business owners define their businesses not only coast to coast, but continent to continent.

Yet despite the global horizon for small businesses, small business owners still face several challenges, among them the many hats they must wear - from CEO to administrative assistant.  Small business owners are often knee-deep in immediate objectives - sales goals, finance and people resources, marketing and advertising campaigns - even pitching in on administrative tasks such as large mailings or office moves.  Add to the mix unexpected changes to the economic landscape, and small business owners can have trouble seeing over the top of the desk let alone across the continents.

One obstacle small businesses will face took effect today when the U.S. Postal Service increased its postage rate, not just for its First-Class stamp, but for weighted mail as well. This new increase comes barely 18 months after postage increased by 2 cents to 39 cents in January 2006. Many small businesses, no matter how technologically savvy, depend on mailings to drive their business and keep customers, and potential customers, informed.  A postage rate increase will mean additional trips to the Post Office, which will cost time, and additional guess-work on package weights, which will cost money.

This is where new technology can help. Small- and home-based business owners no longer have to choose between buying an expensive postal meter system and standing in line at the Post Office. Companies like Sanford L.P., whose DYMO division has provided solutions to small business for many years, have come up with a way to make the postage rate increase easier on everyone.  The DYMO Desktop Mailing Solution is a mailing system that allows users to access and print USPS-approved postage online from the convenience of their home or office.  It comes with a postal scale for determining postage needed, and when connected to the Internet will automatically adjust to reflect the new increase.  And unlike other online stamps systems, there's no monthly service fee.  This is just one example of a product that can save small businesses time and money - resources that could be earmarked for global pursuits.

While some of us started in the business world when it was "low tech," adapting to changing technology has paid great dividends. It will continue to play a growing role in the success of small businesses - the backbone of our economy.

This month's celebrations are designed to applaud the contributions of small businesses, but the term "small" may be misleading for many of them.  For in today's ever-changing global and technological landscape, there is a good chance your local florist, realtor or art gallery owner has just made a sale with a new customer - 1,000 miles away.

Joseph Cardamone is president of the United States Federation of Small Businesses (USFSB). Founded in 1983 by small business owners, USFSB advocates for the rights and interests of small businesses and the self-employed. For additional information, visit www.usfsb.com.