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Monthly Archives: September 2014

Dale Hammernik Examines A Crippling Regulatory Environment For Biz

As we move into the final quarter of 2014, I’ve had some thoughts brewing that I believe need to be said. It’s about a problem that has occasionally plagued various clients of mine, and it speaks to a broader issue.

If there are any legislators who read my blog, please pay attention.

As a business owner, I normally write about marketing tips and strategy, but I also care a great deal about the broader marketplace, as you know. (I wrote about recent credit card legislation as well–mostly as an opportunity to have us all THINK BIGGER.)

So, this isn’t marketing advice per se … but rather a plea for sanity.

Would love your thoughts…

Dale Hammernik Examines A Crippling Regulatory Environment For Biz
“The greater the obstacle, the more glory in overcoming it.” – Moliere

Now, as far as I know, I don’t have any government regulators subscribed to my blog … but this just needs to be said.

You see, lawmakers and the media seem to have dubbed greed as the primary evil responsible for the struggles within the American economy. Insurance companies are routinely accused of greed, as are credit card companies and networks, investment banks, CEOs and so on. As income gaps seem to be widening, and our economy sputters along, our federal policy makers seem quite eager to put checks on “greed” in order to help “fix” the economy.

However, the truth is that in a capitalist economy, profits aren’t a sign of greed, they are simply a sign that a given company’s business tactics are successful within the competitive system in which that company operates.

If lawmakers think that specific companies are making too much money, then the problem isn’t corporate greed, it’s that there simply isn’t enough competition to keep those players from making excessive profits. The President and Congress were determined to use their legislative powers to bail out the U.S. economy a few years back, but they ought to be concentrating their efforts not on greed, but instead on the lack of competition in the marketplace.

Instead, lawmakers have been continuously critiquing the profits of large companies, like those in the health insurance and credit card industries, attributing their successes to greed and greed alone. The business practices of these companies are then regulated by numerous redundant agencies, creating enormous and costly bureaucracies that bog down the system and drive up prices.

In addition, they also create a system in which small companies cannot afford to compete with larger companies, and where companies operating within a single state are hampered by the regulatory costs and procedures that are associated with going national.

What we need is legislation that will increase competition; not laws that prevent competitors from entering into the market. Obviously, excessive regulation does not engender a spirit of competition. If competition as a regulating force were embraced with greater fervor, the system would begin to correct itself — capitalism requires competition, and when it is regulated from outside rather than from within, it begins to resemble something else.

The underlying cause, which has fed the media’s and Capitol Hill’s perception of companies being greedy, is a capitalist economy that has been operating without the competition that is needed to curb excesses. The capitalist marketplace offers rewards to businesses that have successful plans — this isn’t greed, it’s just the nature of the system. And creating a government “gorilla” to squeeze out private industry competition won’t fix things.

The regulatory force that keeps those rewards in check is *real* competition and so it is to competition, and not to competition-defeating regulation, that lawmakers should turn, to get the system back under control.

#EndRant

Look — I want to finish with this: the reason I care about these issues is because I work “in the trenches” with small business owners on a daily basis. Perhaps, like yours. We are looking at the financials, consulting and advising on a host of issues, and we are often the business owner’s closest confidant.

I want to see my friends THRIVE.

So, thanks for reading, and for our relationship. May it ever prosper.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-189

Hammernik & Associates

Dale Hammernik On Why Your Waukesha County Business Needs A Bias For Sales In Unexpected Places

How are things going for you in your business? Is there anything we can help you with, as we round the corner into the final quarter of 2014? Do let me know.

We’re pretty busy around here right now, but I wanted to take a moment and help you address a problem becoming more and more common these days: collections. It’s a problem which SHOULD prompt creative solutions — instead of the “same old, same old”.

So, read on…and let me know if you have thoughts of your own on this…

Dale Hammernik On Why Your Waukesha County Business Needs A Bias For Sales In Unexpected Places
“You will never find time for anything. If you want the time, you must make it.” – Charles Buxton

Especially in our current environment, many different types of businesses are suffering from accumulated “past due” receivables.

And it’s a problem which shouldn’t *just* be addressed by “normal means” (calling, pestering, etc.).

However, you can actually change the way the game normally works. How? Well, I suggest that you use tactics similar to those which WON you the sale in the first place: discounts, premiums for advance or prompt payments, and good old multi-step follow-up.

If you do have (or ever develop) a receivables problem, you’ll need to take this same sort of aggressive action to clean it up. “Preserving the relationship” with a client who can’t (or won’t–more likely) pay his bills is of little value. And, left alone, collection problems tend to get worse, not better.

Even large, long-established corporations can find themselves in trouble with their payables. In that situation, you as a creditor could wait years for your money and then recover only a percentage of it. So it’s important that you set into place a *system* for getting this done.

Because one of the most important lessons that I’ve learned over my years in business is that trends rarely reverse themselves. Trends don’t just change; people change trends. Waiting, procrastinating, delaying action on a negative situation simply means it won’t change — at least, not likely for the better.

When you get that very first glimmer of something “not right” in your business, that’s the time to look closer and to take corrective action. Too many people spot the tip of a problem and choose to ignore it, feeling they’ve got enough to handle already, so why go looking for trouble?

It’s a funny thing how closely-related failure and success are, and how failure is usually the womb of a subsequent success. And, how most business problems have marketing-related solutions. To be very simplistic, effective salesmanship solves most problems–including collections.

You need a bias for sales in every area of your business — even collections.

So, turn your marketing mind onto it. What incentives can you provide to delinquent customers? How can you “cut through the clutter” so that YOU get paid (while other vendors wait … and wait)? Good headlines, conversational appeals, and multi-step follow-ups is a good place to start. And “starting” on this issue is the biggest step.

Your bottom line will thank you, if you take the action.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, at Hammernik & Associates we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates

Dale Hammernik Challenges Your Small Fee Thinking

Do you accept credit cards in your business? If not … why not?

Obviously, it’s a matter of some debate for certain merchants, but I’m here to tell you: if you are NOT, then you could be running a big risk. Whatever your opinions about the over-availability of credit (and as a general supporter of the debt-free lifestyle, I completely get those concerns), the fact remains that as a business owner you must make your best *business* decision on this subject.

Here’s where I may be getting a little blunt: neglecting to accept credit cards as a form of payment is a short-sighted, and tight-fisted perspective which is robbing your business of a slew of potential customers.

(Ouch, that was a bit blunt.)

Now, that said — I’ve got some further thoughts on some legislation that was implemented last year, and am taking a stab at giving you some unvarnished “straight talk” perspective.

Would love to hear YOUR perspective too.

I know this is a subject which might cause you to think, “Why is Dale Hammernik even weighing in on this?”, but I mostly want to focus on the “small thinking” in this issue. Because it may be a reflection of other poverty-driven thinking in your business.

Here’s what I mean…

Dale Hammernik Challenges Your Small Fee Thinking
“Thinking will not overcome fear, but action will.” – W Clement Stone

The stats are continuing to rise: most Americans, in their personal AND business life, most often use credit cards for purchases.

As a business owner, you are no doubt aware that behind the scenes, when you swipe your credit or debit card through the machine, the merchant pays a small fee to their bank (i.e., interchange fee) for the ability to accept credit card transactions. Let us be blunt about this: if the business wants your money, then they would be smart to pay these fees because cash transactions are becoming rarer with each passing day. ‘Cash only’ businesses are becoming a thing of the past.

However, some merchants became miffed that they had to pay these fees, and they recently went to Congress to fix it. Bills went through Congress that allowed merchants to enter into collective bargaining with the banks, and made it easier for merchants to steer customers to other forms of payments (by including a surcharge for cc transactions) and let them set minimum and maximum amounts for credit card purchases.

My big question is: why did they do this?

An association of merchants, or an association of banks, is a powerful special interest group in this country. So much so, that when they weren’t happy with how things were going, they could ask Congress to pass laws to fix things, and they could do this regardless of whether or not these issues were deserving of national attention.

The problem is two-fold: The merchants can fix the problem themselves (by offering incentives for using cash, etc. — but STILL providing cc options), but they demand that Congress step in. And the merchants shouldn’t be able to find support for this issue in Congress, but they can, and easily.

And to my business-owner colleagues–stop worrying about ticky-tack fees, and START focusing on what you CAN change–the bottom-line results driven by effective sales and marketing.

Opinions about legislation aside (and there may well be good reasons for why this legislation was passed, on which I don’t yet have a clear grasp) … the main point is that when you, as a business owner, spend time and focus on these sorts of “two percent” bumps and NOT on more powerful ways to add revenue and growth to your business, your thinking is too small.

Instead of banding together for or against ticky-tack fees, let’s together, as local Waukesha County business owners, instead band together to make our businesses more effective, more profitable, and more attractive to consumers and clients so that we are paid what we are really worth.

That’s something we should ALL put our focus towards.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, at Hammernik & Associates we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates

Dale Hammernik Discusses The Wrong Way To Start or Turn Around a Business

I have too many friends who start a business, or seek to turn around a flailing one, and use this principle as a guiding light.

May it ever be stricken from your consciousness.

But before I remind you of what I KNOW you surely know … here are a few other things you surely know, but also perhaps need a reminder for … (like a good blog post, this is your friendly reminder):

1) Monday, September 15th is the estimated tax payment deadline for the third quarter.Our existing clients were given coupons to make it easy (albeit never fun), so let us know if you need any quick input there…

2) Corporate extensions are also due that Monday. This really only applies to you if we handle your S- or C-corp returns (which, of course, we do for a number of our business clients in the Waukesha County area). We’re on top of this on your behalf, if that’s you.

And now, for my primary friendly reminder of the week …

Dale Hammernik Discusses The Wrong Way To Start or Turn Around a Business
“There is no victory at bargain basement prices.” – Dwight Eisenhower

I discuss this all the time with my business owner clients — how to price their services. You see, often, we might hear consumers say, “Well, I would buy it if it were in my price range.” And, that idea tempts many business owners to lower their prices–just to sell more products.

However, as you already know, price reductions sometimes create more problems than they solve.

For example, price reductions…

* Decrease net profits
* Lead to the purchase of lower-quality products
* Increase customer demands to drop the price even lower!
* Require even more sales to make up the difference in revenue
* Need a larger quantity of products

And, in the end, as John Jantsch (author of Duct Tape Marketing) says, “There will always be someone willing to go out of business faster than you.”

Remember this: price is not a benefit. The close of a sale is not determined on the cost of your product. If you truly “sell” your customers and prospects, they will purchase your products/services no matter what price you determine.

That’s the plain truth–and you’ve probably seen it in your own purchase patterns.

If a customer or prospect doesn’t buy–and they claim the cost had something to do with it–you can guess they probably wouldn’t have purchased anyway.

As a small business owner, and marketer, your job is to sell your products and services. But the actual art of selling has nothing to do with the price of the product.

By the time your contacts find out about the price, they should be determined to purchase no matter what the cost.

So, find “real” benefits (value) to sell to your customers and prospects. Help them to see how great their life is with your product, and you’ve got a customer. Point out their current pain, and your contact will do anything to get rid of it.

Set your prices and hold fast. If you’ve marketed correctly, you will still have customers anxious to do business with you.

Price gouging is a horrible thing — but, really, that’s a bogeyman that lives more in our heads than in real life.

Charge your worth. You deserve it.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, at Hammernik & Associates we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates

Dale Hammernik Reveals How to Catch Your Prospect in 8 Seconds (or Less)

In the midst of all of this world chaos, hopefully, you’re still recognizing the need to market your services aggressively.

The best way we in the Waukesha County area can be “prepared” for whatever comes is having a healthy, cashflowing business.

But consumers and buyers are affected by everything around us, and despite the recent rash of ice-bucket-induced generosity (which is WONDERFUL, in my opinion), they’re still holding onto their purse strings pretty tightly these days…

So it will take good work to get them to make purchases and for you to make more sales.

What I’ve learned from my marketing friends: it all starts with you how begin.

The headline. (You do have those in your marketing, yes?)

So… I’ve collected some tips on writing great headlines, and it’s the subject of this week’s Business Strategy Note.

Before we go there, pardon me for a brief, tax-related interruption:
1) Corporate taxes on extension are due 9/15.
We should have already corresponded about this if it affects you.

2) Quarterly tax payments also due on 9/15. I know, ugh.

3) Prepare for the upcoming tax season, by making sure you will have these documents ready:

Gross receipts: Cash register tapes, bank deposit slips, receipt books, invoices, credit card charge slips and Forms 1099-MISC
Proof of purchases: Canceled checks, cash register tape receipts, credit card sales slips and invoices
Expense documents: Canceled checks, cash register tapes, account statements, credit card sales slips, invoices and petty cash slips for small cash payments
Documents to verify your assets: Purchase and sales invoices, real estate closing statements and canceled checks

Now, onto those headlines…

Dale Hammernik Reveals How to Catch Your Prospect in 8 Seconds (or Less)
“The creation of a thousand forests is in one acorn.” – Ralph Waldo Emerson

Here’s the truth: most readers or listeners take 8 seconds or less to decide whether to stick around or move on to the next thing. Just 8 seconds — that’s all the time you have to convince them YOUR piece is where they want to stay for a bit.

It doesn’t matter how well-designed your marketing piece is… or how amazing your product.

If you don’t GRAB your prospect’s attention right away, they’re going to leave and probably never return.

Of all the words in your piece, the most important are the ones in your HEADLINE.

Your headline is the first thing your prospects see or hear (I hope you see that this applies to items outside of print marketing as well). It needs to capture their attention — spark their curiosity– and compel them to engage further. And it has to do it fast.

So I’ve collected three keys to great headlines…which will help you make more sales. Again, I don’t pretend to be a guru. These are suggestions which I’ve pulled together from some of the best marketing minds out there.

Rule #1: RELATE A PROBLEM
Most prospects, especially if you target them properly, are looking for information — probably in relation to a problem they want to solve.

Maybe they’re curious about local flight schools in their area. Maybe they’re wanting molded chrome fenders to put on a 1953 Chevy Bel-Air. Or maybe they’re trying to figure out how to “unshrink” wool clothes that accidentally ended up in the dryer.

Whatever their problem is, relate to it. Show them YOU know what it’s all about. Demonstrate a clear and genuine understanding of their wants and needs — and they’ll be far more willing to buy from you.

Rule #2: PRESENT A SOLUTION
You’ve described a problem. Now you’ve got to solve it — in a way that creates a powerful image in the mind of your prospects.

Tell your prospects they’re about to discover how to get the most qualified flight instructors at the lowest price in town. Describe how their new chrome fenders will help them outshine the competition at the next state-wide car show. Promise them their wife or girlfriend will NEVER know her favorite sweater once shrank small enough to fit a chihuahua.

Get them to envision the end result — and you’re more than halfway to making the sale.

(NOTE: “How to…” and “Discover…” headlines are good at getting people to imagine the end result.)

Rule #3: FOCUS ON BENEFITS — NOT FEATURES
People aren’t so interested in what your product or service is. They want to know what it does.

Specifically, they want to know what it’ll do for THEM.

Tell them they’ll get the real “inside scoop” on the flight school scene — because they’ll be learning it from someone who’s been a pilot in the area for more than 30 years. (Provided that’s true, of course.)

Have them imagine the honks, smiles, and admiring glances their car will get every time they drive it down the road. Describe the relief they’ll feel when they know they’re back in their wife or girlfriend’s good books.

Remember the most important question that’s on all of your prospect’s minds — “What’s in it for ME?” — and make sure you answer it.

Once you’ve written a few different headlines, TEST THEM. Run them for a couple of weeks, then compare the results against other headlines. Then, tweak them and test them again!

You may have to do this a few times before you hit on one that consistently yields great results — but it’s definitely worth the effort.

Feel very free forward this article to a Waukesha County business associate or client you know who could benefit from our assistance — or simply send them our way? While these particular articles usually relate to business strategy, as you know, at Hammernik & Associates we specialize in tax preparation and planning for Waukesha County families and business owners. And we always make room for referrals from trusted sources like you.

Warmly (and until next week),

Dale Hammernik
(414) 545-1890

Hammernik & Associates