Mike Michalowicz's Blog, page 56
November 28, 2016
Episode 124: Raising Money for Your Business with Susan Lassiter-Lyons
Show Summary
On this episode with Susan Lassiter-Lyons we talk about how to raise money for your real-estate business and why those big banks may, in fact, not be the best choice. She explains alternatives such as local banks, private investors and some other sources. She also guides us on how to make your real estate business by adding tack-on-benefits. You don’t make money just through rental income; there’s other things you can do through property. Welcome to Episode 124 of the Profit First Podcast!
Our Guest
Susan Lassiter-Lyons is the most sought after private capital consultant in real estate. She is famous for structuring investments that provide an excellent return for investors without giving up equity or control of the company. She began investing in real estate in 1994 by forming a small syndicate to purchase tax liens at auction. Since that modest start, she’s closed more than 600 transactions as an investor, broker, lender, syndicator and advisor. Additionally, she has…
* Raised $26.2 million in private capital from debt partners to fund hundreds of deals.
* Sponsored hedge funds/syndicates including multifamily equity offerings and private equity mortgage funds
* Authored the Amazon #1 best-seller Getting the Money: The Simple System for Getting Private Money for Your Real Estate Deals
* Trained more than 10,000 students who have cumulatively raised more than $250 million in private capital.
Guest Links
Website: http://theinvestorinsights.com
Corporate Partners
Receipt-Bank – Software and service to make the gathering, storage & processing of bills, receipts and invoices as easy and as cost effective as possible for businesses.
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
Fundbox – The simplest and fastest way to fix your cash flow by advancing payments for your outstanding invoices.
Xero– Accounting software with all the time-saving tools you need to grow your business. Xero is always secure and reliable and our experts are here to support you 24/7.
November 23, 2016
Create Your Own Language For Your Business
The first time you went to Starbucks, words like Tall, Venti, and Macchiato may have confused you. That was by design. Star Bucks knows that loyalty is formed out of belonging.
When a group can distinguish itself with its own internal language, the loyalty only strengthens (and so. Of course, the trick is getting new folks quickly acclimated to the language so that they feel like insiders and not outsiders. Starbucks has a trick for this too – rapid new language repetition.
The flow of customer traffic through a Starbucks is setup that when you are in line you hear the unique terms said during the customer order before you. When you place your order, the terms are yelled back to the bartista by the cash register attendant. When your order is ready the unique terms are yelled out again by the bartista.
And if you are a newbie, when you order a “small coffee”, they quickly educate you on the proper language “tall pressed French vanilla without cream”.
Once you learn the language, your in. For life.
What new language have you invented for your business to teach your customers? It will make them customers for life.
November 21, 2016
Episode 123: Create a Profitable Crowdfunding Campaign with Ariel Hyatt
Show Summary
On this episode we interview Ariel Hyatt and the conversation is about how to run a profitable crowdfunding campaign. Ariel is the author of a book called a Crowdstart:The Ultimate Guide to a Powerful and Profitable Crowdfunding Campaign and shares the necessary elements in creating a campaign that will bring revenue and profit to the business. The big hint is that you need to prepare for the campaign well in advance. The campaign is just the icing on top. Discover all the elements necessary to have your successful and profitable campaign. Welcome to Episode 123 of the Profit First Podcast!
Our Guest
Ariel Hyatt has been a fierce entrepreneur for more than 20 years and runs Cyber PR, a dynamic social media & content strategy firm based in New York City. Her agency places clients on blogs & podcasts, establishes their brands, and advises on how to create online influence. She has spoken in 12 countries to over 100,000 creative entrepreneurs, and is the author of four books on social media, including Cyber PR for Musicians and Music Success in 9 Weeks, which have both hit number one on Amazon. Her newest book Crowdstart:The Ultimate Guide to a Powerful and Profitable Crowdfunding Campaign comes out on October 25, 2016.
Guest Links
Website: http://arielhyatt.com/all-about-crowdstart/
LinkedIn: https://www.linkedin.com/in/arielhyatt
Facebook: https://www.facebook.com/arielcyberpr
Twitter: https://twitter.com/cyberpr
Corporate Partners
Receipt-Bank – Software and service to make the gathering, storage & processing of bills, receipts and invoices as easy and as cost effective as possible for businesses.
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
Fundbox – The simplest and fastest way to fix your cash flow by advancing payments for your outstanding invoices.
Xero– Accounting software with all the time-saving tools you need to grow your business. Xero is always secure and reliable and our experts are here to support you 24/7.
November 16, 2016
The Power Of Our Thoughts
It is a paradox. Success requires a clear vision. The more you can see it, the more likely you are to achieve it.
I get it. In fact I believe in it so much that I repeat a “success mantra” every morning and ever night. I have a clear vision for what I have defined as success in my business, in my health, in my spirituality and in my family life.
But I also noticed that sometimes I get way to fixated on the vision. Take softball for example. I play in a pick-up game about five to ten times during the summer months. I decided that I wanted to be a regular home run hitter and set the vision. No mantras needed for this one. Just envisioned myself hitting the ball out of the park every time.
Sure enough, I did. With my newly found hitting skills I earned the coveted batters position – 4th spot in the order.
Then I expanded the vision. I decided I wanted to hit the home runs so far that they went sailing into the distant woods. Something, that I believe, no other batter has done. This vision was so clear that I played it over and over again in my mind. As I approached the batters box, I walked through each step necessary to hit the ball that far. I over thought it.
As the pitch came my way, my mind was going crazy with all the things I needed to do perfectly to hit it that far. I need to have a slight down to up swing. I had to snap my wrists a little bit earlier. I had to put more muscle into it for sure. I had to take a slightly bigger step. As I thought the ball sailed by. Strike! I thought so much that I forgot to swing.
Next pitch. My mind was going more crazy. All the same steps, but had to remember to swing this time. With all the thoughts rushing through my head, I swung too early. Strike two! The third pitch was worse. I swung so late and so hard that I nearly threw my shoulder out. Strike three!
Subsequent up-at-bats I went through the same mind talk nonsense. My fluid swing, became a mechanical choppy-chop-chop. The more I screwed up, the more I over thought it. And the worse I got. That Sunday was my worst outing ever, even though I envisioned it would be my best. The mistake? Overthinking.
Vision is power. Preparation is necessary. But when you are up at the plate, it is time to stop thinking. It is time to let your natural instincts take over. It is time to sit back and observe yourself. I have found it to be the only way to hit home runs.
In fact, next year I envision myself hitting “into the woods” homers. I’m just not thinking about it.
November 14, 2016
Episode 122 – How to Write a Profitable Book with AJ Harper
Show Summary
In this episode we interview Mike’s co-writer for all of his books, AJ Harper. We explore how to write a book that will be profitable because it has impact on your readers. You are not about to discover the 20-minute method for how to write a book. Instead you are about to discover the method to writing a book that has permanent impact and will bring permanent profits to you. Welcome to Episode 122 of the Profit First Podcast!
Our Guest
AJ Harper is an award-winning ghostwriter, editor and publishing consultant. She has helped hundreds of authors – from newbies to New York Times bestselling authors with millions of books sold—develop significant and loyal followings, grow their brand and secure lucrative deals for follow-up books.
AJ works exclusively in the professional and personal development genre, and is part of the team behind several bestselling collaborative books, including Living Proof and Unbreakable Spirit, presented by Lisa Nichols, Fight for Your Dreams, presented by Les Brown, the “Succeeding” series, presented by Sandra Yancey and eWomen Network, and two books for New Peaks, formerly Peak Potentials.
Corporate Partners
Receipt-Bank – Software and service to make the gathering, storage & processing of bills, receipts and invoices as easy and as cost effective as possible for businesses.
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
Fundbox – The simplest and fastest way to fix your cash flow by advancing payments for your outstanding invoices.
Xero– Accounting software with all the time-saving tools you need to grow your business. Xero is always secure and reliable and our experts are here to support you 24/7.
November 9, 2016
Reinvigorate Your Business With Tiered Pricing
When you make a lot of money, or you did then lost it all and are now rebuilding yourself, they want to know how you do it. I guess that’s why one of the most frequent questions I’m asked is, “Mike, how do I make more money?”
I have an answer, a very good answer as a matter of fact, but before I give it to you, let’s be clear on one thing. We’re assuming that you’re already making some money now, right? I mean my answer won’t do you any good if you’re standing on a street corner with a cardboard sign that reads, “Will work for money.” Ready for the good answer? Product tiers.
Using Product Tiers
For this system to work, (are you feeling the suspense yet?) you have to already be making some money doing something for clients who pay you for whatever it is you do. That’s the key element required for the time tested, and totally effective, tier method of increasing revenue to work. If you are currently making no money and have no clients, then I hate to say it, but this blog post really isn’t for you. Instead, I recommend you read my other blog posts about starting a business from scratch.
Building on a Brand
Congrats. . . you’re making some money doing some thing, right? So let’s get started using the product tier method to increase your revenue. Step one; take a look at what you are selling. For simplicity’s sake, lets say you sell soap. It’s not fancy soap. It’s just good old wash-the-dirt-off-your-hands type soap. Now let’s have a try at making a new variation of this product that’s a little more expensive. Maybe the newer, more expensive version is made using a special organic abrasive, like sand or crushed walnuts so it will scrub the tough and disgusting stuff, like worm guts off a fisherman’s hands, along with the dirt. Or add aloe and some organic frou-frou herbal scent and sparkly flakes to it to make it fun to take into a bubble bath.
Then, make another, even more elite version of the product. Maybe the next step up the tier has crushed flower petals mixed in with the soap and comes wrapped in a special paper made from recycled cardboard that helps save the planet. While there is no right or wrong answer here, find some way to build a higher tier of your basic product, then a better one, and then the best one. Each of these will be at increasing price points, of course.
Why It Works
Tiered systems play into the psychology of your customers. Think about it. We all want to be the best at something. (That pecking order thing doesn’t just happen with chickens and turkeys – and by the way, turkeys win – Go Hokies!) If we can’t be the best at sports, we try to have the best car in town. If we can’t do that, then we find something else to be the best at, or to have. It can be the best spouse, best kids, best haircut, best smile, best grump (yes – some of us strive to being the best at the worst stuff), best rhubarb pie or be known for throwing the best parties. We are surely hardwired in life for two things, (1) to want to make more money and (2) to be the best at something. And if you make soap, then having the best soap is one way to achieve both things you’re wired for.
Customers are people too. They’re also hardwired to always want to stand out by being the best. If they can do it with your product, then in their mind at least, they are the best. Most people will use your regular old soap (maybe they are the best, in their mind, at something else), but others will, without a doubt, upgrade and gladly pay the price to get the best to feel like the best.
Case in point – remember Izod shirts? You know, the one with the alligator on it? Or the Polo shirt with the Polo logo? It is the same stinking shirt you can get just about anywhere. But, with the Polo or Izod logo on it, the shirt becomes the next tier up, and people happily line up to pay twice as much money for the shirt with the logo on it. This is because they feel it makes them the best, not at wearing shirts, but it signifies they hang out with the people who have and wear the best because they are the best. Or something. Either way, in their minds it matters.
Give Them the Chance
The most fun thing about product tiers is the race to the top. If you ever played “King of the Hill” as a kid you understand the pride and excitement of standing on top and looking down at everyone else. Everyone wants to climb up to the top of the highest tier. Unlike playing King of the Hill as a kid, where it was your sworn goal to kick people off the hill, now you want to let people climb your hill, er tier, quickly. The faster they scramble up the tiers, the more money you’re making. So when someone buys your regular soap, tell them about your other products. Tell worm gut fishing guy about your special abrasive, but loaded with skin softeners soap. Tell his wife about the “gold flakes, fun in a bubble bath” lavender scented soap. Point them to the next rung up and let them start climbing tiers.
Folks, this works across the board for all kinds of products. Do a quick case study of the examples within American Express (a personal favorite of mine—and no I am not brown nosing here. Well maybe a little.) They have the “Plum-to-Gold-to-Platinum to the “super secret” Black Card tier model. Notice how that even though you know about the product tier model now, you’re still have the little voice inside saying, “Gotta have that black card.”
This model works for services, too.
Still not convinced? Okay, ever fly coach? Or business? Or first class? Yep. All product tiers. Shoot, even theme parks do it! They start out with their standard park access, then offer a priority line, and then even an exclusive or ‘early access’ pass.
The product tier system is the key to increasing your revenue. It’s right in front of you. Just look at what you currently offer, whether it’s a service or a product, and determine what you can offer to the person who wants a “better, more better, betterest best” version possible. Then run with it!
Dig Deeper Into Consumer Behavior
If you want to learn more about how consumers behave, my favorite read on the subject by a long shot is Why We Buy by Paco Underhill. A great compliment to Underhill’s book is The Paradox of Choice by Barry Schwartz.
November 7, 2016
Episode 121: Reframing Customer Loyalty with Jack Daly
Show Summary
Jack Daly is a master of public speaking and sales and shares with us his tips and processes. He really delves into techniques to connect and grow customer relationships by using effective systems. Welcome to Episode 121 of the Profit First Podcast!
Our Guest
Jack Daly is an expert in sales and sales management inspiring audiences to take action in customer loyalty and personal motivation. He delivers explosive keynote and general session presentations.
Jack brings 30 plus years of field proven experience from a starting base with CPA firm Arthur Andersen to the CEO level of several national companies. Jack is a proven CEO/Entrepreneur, having built 6 companies into national firms, two of which he has subsequently sold to the Wall Street firms of Solomon Brothers and First Boston.
Amongst a career of highlights, here are a couple of noteworthy examples:
In 1985, Jack relocated to California from the east coast and started a mortgage company with 3 colleagues. As CEO, Jack lead the company through robust growth in its initial 18 months to 750 employees, 22 offices nationwide, producing $350 million per month in mortgages, and its first 3 years the company reported profits of $42 million.
In 1998, working as a senior partner in a 5 year-old privately held Enterprise, Jack helped the company to be recognized as Entrepreneur of the Year by Ernst & Young and ranked #10 on the Inc. 500 list of the fastest growing firms nationwide.
Two-time Amazon bestselling author of Hyper Sales Growth and Paper Napkin Wisdom
Guest Links
Website: http://www.jackdaly.net/
Corporate Partners
Receipt-Bank – Software and service to make the gathering, storage & processing of bills, receipts and invoices as easy and as cost effective as possible for businesses.
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
Fundbox – The simplest and fastest way to fix your cash flow by advancing payments for your outstanding invoices.
Xero– Accounting software with all the time-saving tools you need to grow your business. Xero is always secure and reliable and our experts are here to support you 24/7.
November 1, 2016
5 Ways to be More Profitable Before Christmas by Christine Rico
If you run a food businesses you know the Squeeze: continuous pressure on price alongside heavy costs for both raw ingredients and labor.
The squeeze is the same whether you’re a farmer, food manufacturer, baker or restaurant owner: your product is essential to human survival. Everyone eats. But producing a high quality product at a reasonable cost with room for profit is a never-ending challenge.
Still, I know it can be done! I’ve worked with dozens of food companies to implement Profit First, create growth plans, and raise capital to grow both profits and scale.
Still, I’m constantly looking for ways to improve financially health and stability of companies in this industry. So last month I interviewed six experts that work with and invest in growth stage food businesses to learn their tips and tricks.
The experts include three investor-backed accelerator programs, one investor, an advocate for sustainable seafood companies and a leading industry magazine publisher & editor.
Here’s their advice for how to build a profitable company –PLUS the immediate steps you can take right now to improve profitability before Christmas:
The most important thing you can do to build profitability:
Develop a maniacal focus on the consumer; then focus on meeting the need of the consumer — in a cost effective way.
Andrew Ive, FoodX Accelerator
For a small business; generally you have to increase sales to find economies of scale in your other costs. To increase sales; hire people. Then get the right equipment and proper infrastructure; gain efficiencies – get a better margin.
Monica Jain, Fish 2.0.
For companies making a food product you must clearly differentiate your product in a crowded market place. Always ask yourself, what would keep the big guys from doing the same thing? If you can’t make the difference clear and visible you’re essentially selling a commodity. Also, if you make products with health claims; Its not enough to make a claim: Document the impact your product can have on health. You need science to back-up claims.
Renske Lynde, Co-founder & Managing Director, Food System 6 Accelerator
Many people make the mistake of thinking that scale will achieve profitability, but if the unit economics aren’t sustainable then growth will lead to death. Unit economics doesn’t just mean the gross margin. Be sure you understand how to make every aspect of the business repeatable and scalable: aggregation, ingredient purchasing, production, fulfillment, customer experience and customer retention.
Shen Tong, Food Future Incubator
For a company to be financially sustainable you have to pay yourself! If you’re not taking a salary you are making a loan to the company and need to get paid back in the future; include any salary payments you miss as a loan on your balance sheet and keep track of just how much you’ve lent the company. When people don’t account for their time and effort they get resentful. It also gets harder and harder to pay yourself later. You have to build this into your business from the beginning.
Derek Denckla, Investor and founder of Slow Money NYC; Convener Food+Enterprise Summit
Bringing in revenue is the hardest part of any business. Even if you produce a wonderful product, if you don’t connect with customers and actually make the sale, it doesn’t work. I think more important to focus on revenue than simply cutting costs. It’s important to be lean in this day and age, but you cannot save yourself into success.
Brian Halweil, Editor in Chief
Edible Brooklyn, Edible East End, Edible Long Island, Edible Manhattan
One thing you can do in the last 10 weeks of 2016 to end the year on a high note:
The number one thing you can do to get more customers (and get to know their needs) is to talk with people. The one action you can take is to meet people: make friends with people; especially people in your industry – distributors, other business owners, retail store owners or buyers. Start now to talk to people and build relationships.
Andrew Ive, FoodX Accelerator
Right now you can look for inefficient parts of your business and how to change the elements that aren’t performing well. Make whatever changes you need to make right away. Show that you can see the problem and act. Young businesses have a lot of product lines and sales channels. But if you are delaying the decision point (about cutting out services or products) because its too painful then now is good time to clean them off your balance sheet so you’ll be leaner going into the new year.
Derek Denckla, Investor and founder of Slow Money NYC; Convener Food+Enterprise Summit
The really important thing to do right now is talk with your customers – make sure you know what they are valuing. Let them tell you what to focus on.
Monica Jain, Fish 2.0.
This is a good opportunity to take time to really figure out how to optimize your business and how to position yourself. Drill down into unit economics, market penetration, and market share. Build your base for growth in 2017.
Shen Tong, Food Future Incubator
This is a perfect time of year to say thank you to your existing customers and vendors and suppliers and anyone you do business with. It also puts you in a good position for rekindling relationships and getting new customers in 2017. If you are the sort of business that sells something on an annual or subscription basis, this is also a good time of year to offer an incentive for committing now for 2017. If you incentivize early payment that’s another great way to get revenue in the door.
Brian Halweil, Editor in Chief
Edible Brooklyn, Edible East End, Edible Long Island, Edible Manhattan
My best advice? Set specific and clear goals for each part of your business: revenue, profits, operating efficiency, and social and environmental impact. Then obsessively track your progress in a public way. Share your goals with your team or colleagues; post them on the wall in your office. Then get to know and love your numbers.
To help you rock the end of 2016 – and all of 2017, download a Growth Toolkit from CFO on Speed Dial.
Christine Rico is the founder of CFO on Speed Dial and a CFO consultant to local, sustainable and healthy food companies. As a Profit First Professional with 25+ years of experience in business development, financial management and coaching she supports food business owners with critical financial decisions and building profits.
Let Your Packaging Prime Your Customers
Our prospects and clients are highly influenced by their first impression. It is called priming – what we see first, determines our perception of the things to come. You can greatly influence consumer’s perception of your brand via your packaging.
Here is an example of a cleaner my wife and I bought to clean our dining room table. Is it a better product than the alternatives? Probably not. Is it better packaging? Yes.
Old fashion packaging conveys confidence – old school, effective stuff. The package primed me (including the old fashion spelling of “universel”), and I bought it. How can you change your packaging to increase sales?
