The Australian Small Business Blog

The Australian Small Business Blog

This Blog has been providing a Forum where Australian Small Business Owners can exchange Ideas old & new and get Advice from experts in Australia on how to Improve their Businesses through better Business Management, Planning & Strategy, Business Systems and Marketing Strategy and Systems for over 10 years. They will also learn about the Small Business Best Practice Benchmarks that are critical for their success. Our Ultimate Objective is to help Australian Small Business Owners take their Business to the Next Level and achieve their Goals whatever they may be.

Wednesday, September 26, 2018

Leveraged Marketing – How much are you missing?

by Dr Greg Chapman

Do you have several marketing campaigns running simultaneously? Perhaps you run an Adwords campaign, have a joint venture with another business and an ad in the local paper. All quite independent campaigns you might think, that bring in a regular supply of enquiries.

Adwords sends leads to your website- possibly your most important piece of marketing collateral. Your JV partner emails you whenever they want to refer you to someone, and you then give them a call. Your ad in the paper encourages readers to call you.

If you were to link these campaigns, this this would enable you to leverage your marketing investment by connecting all your marketing collateral, resulting in both increased enquiries and sales. How might that look?

Tuesday, September 25, 2018

How Big are Small Businesses?

by Dr Greg Chapman

The official Australian Bureau of Statistics (ABS) definition of a small business is one with less than 20 employees which, according to their latest data, make up 96% of all businesses. Together they contribute 35% to industry GDP, so they are important.

Another way of looking at business size is by turnover. The ABS found that 94% of businesses turned over less than $2 million and 63% earned less than $200,000. While both turnover and the number of employees are an important way of defining business size, they really don’t give much insight into how they are run.

As a business grows in size, its sophistication must also increase if it is to survive. That means better management, better systems and better reporting because the owners are unable to be everywhere and watch everything. There will be organisational changes as well. At some point an operations supervisor will be appointed so the owners can focus on growing the business, but I would still regard such a business as being small.

The next stage is the appointment of managers for key business areas. This is the real point where a business moves from small to medium size. However, it is not just the organisation structure that makes the difference between a small and medium sized business, it is the way they operate. Not only is there more delegated responsibility, but the owners share the decision making with their management team, although the owners may still reserve the right to set the vision.

Wednesday, September 19, 2018

A Director’s Risks on a Small Business Board

by Dr Greg Chapman

An interesting article has been published on the liability of directors based on the recent court decision on Centro.

Many small business owners will consider that these types of rules do not apply to them, but in fact they do. In this case, the non-executive directors relied, at least in part, on the results of an external audit by a highly reputable external accounting firm, that their company was not insolvent. Clearly, for a large company which is likely to consist of multiple entities, this can be extremely complex to assess, and hence the need to resort to a top tier accounting firm to pick through the structures and accounts.

Even though you may argue that the non-executives did all that could reasonably be expected to ensure solvency, the courts disagreed.

While these complexities don’t exist for most small businesses, there can still be big risks where there are multiple partners, some of whom may not be as active as others, or who might be even silent partners. All directors are equally liable; in legal jargon, jointly and severally.

Tuesday, September 18, 2018

Couples in Business - Are You Arthur or Martha?

by Dr Greg Chapman

Small business owners are usually chief cooks and bottle washers. They have to be capable of doing everything while they are watching everything. It is a little easier if you have a partner in business to watch your back, but if you are in a personal relationship with your partner, roles can easily become blurred. The question is, if you are in business with your personal partner, are you Arthur or Martha?

If it is true opposites attract, couples in business have an advantage. Roles in any business are crucially important. Too often in business you see situations where the left hand does not know what the right hand is doing, or alternatively, there are two left hands and no right hands, and a lot of balls get dropped. However, for couples in business, despite the distractions, they tend to take on complementary roles, ones the partners prefer naturally.

These preferred roles have little to do with gender stereotypes. It may be that they are either extroverts or thinkers, risk takers or cautious, and big picture people or implementers. All roles are important and must exist in every business to a greater or lesser degree. While these differences occur in all partnerships, for couples in business, there is one other type of division that occurs far more often than in other partnerships – the technical vs the business focus.

Wednesday, September 12, 2018

Benchmarking Franchisee Performance: Comparing Apples and Oranges

by Dr Greg Chapman

Even though comparing the performance of your franchisees can be a minefield, it is still best practice to do so. How else do you know which franchisees are leading the way, and which need further support? What better way to discover the new ideas that have proved to work and should be spread across the whole franchise?

However, comparisons between franchisees can be like comparing apples with oranges.

Monday, September 10, 2018

Does Your business suffer from Growing Pains?

by Dr Greg Chapman

Busier than a one armed wallpaper hanger? Don’t have time to scratch yourself? Have a waiting list for new clients? Has previous exponential growth rate has slowed to a crawl? If so, then it’s likely your business is experiencing growing pains.

Chances are you are working longer hours than any of your staff, and are the last to get paid. Your business is a victim of its own success.

If you do take any time off, when your return, you wish you had never left. It’s as if nothing happened at all when you were absent. Sure, work was done, but nothing progressed, and your inbox is full of unanswered enquiries. Your business has become its own version of groundhog’s day. While it feels like a trap, it’s also an opportunity.

Wednesday, September 05, 2018

Accountants Are You a Business Advisor or Bean Counter?

by Dr Greg Chapman

[This article was originally published in National Accountant Magazine]

Almost every small business owner has an accountant but how many actually use their accountant as the primary source of (non-tax) business advice? When an owner first starts their business, they are usually very dependent on their accountant for advice. They are seen as knowledgeable, independent – someone they can trust. They help them set-up the business, suggest the right structure and who can help them do the many things a new business owner must do.

However, this dependence does not last.

Their advice is often not sought as the business grows and becomes more complex. There is, of course, much more an accountant can do to advise their clients, but they seem unable to convince them that they are the right person to provide them the answers they seek. The owners baulk at the accountant’s hourly charges and the lack of clarity in their offer of advice. In the end, they decide to use their accountants just for tax, as it is clear that there is no other group that is as knowledgeable on tax, but they seek alternatives whose value proposition is clearer for other business advice.

Monday, September 03, 2018

Ad of the Month – Another Winner

by Dr Greg Chapman

About a year ago I posted an Ad of the Month - Winner . It was about an advertiser associating itself with a winner with the implication that if you bought their product, you would be one too. The ad in question was with Roger Federer. This time, the ad is with Serena Williams. What a contrast.

Thursday, August 30, 2018

The Extra Dollar More

by Dr Greg Chapman

"Upselling", or the "add-on sale", is an opportunity open to every business, yet most business owners and their staff don't ask for the extra purchase.

Fact is, once the customer has made the decision to buy from you, they have entered into a relationship of trust. And once the initial buying decision, or trust in you, is made, then they will more readily say yes to an additional offer. So why not make it?

In this podcast I reveal how to get that extra dollar more for zero cost.

Wednesday, August 29, 2018

Price Comparison Websites

by Dr Greg Chapman

To list, or not to list, that is the question, as Hamlet probably never asked. There are numerous websites now offering customers the ability to get multiple quotes for a service. This is great for the customer because they are able to find the best service at the lowest cost in a side-by-side comparison- but is it the right thing for your business?

The attraction for businesses listing on such sites, if they have been properly promoted, is that it will be another channel for referrals of business that you may not have otherwise received. Unfortunately, this business will likely be won on price.

While such comparison websites offer a convenience to customers, there is limited capability to interact with the businesses. This is necessary as these websites don’t want to be cut out by either customer or the business with them dealing directly, and so losing their commission. This means that it’s difficult for businesses to demonstrate their point of difference and speak with the customer directly. Usually, they just have a text box to describe their offer with limited ability to link to their own website, if at all.

This restriction in communication encourages the customer to focus on price as asking questions, and waiting for responses takes time. From the customer’s perspective, if the job is straight forward, requiring little creativity, this may be quite acceptable, even efficient, but is this the sort of job you want to win?

Tuesday, August 28, 2018

Are You Promoting the Right Products and Services?

by Dr Greg Chapman

Most businesses have a range of products and services they sell, and hopefully they all make a positive contribution to your bottomline, but this is not always the case. Too often marginal products and services are being promoted generating profitless turnover and therefore a loss when the cost of the sale is included.

It’s essential when deciding how to allocate your precious marketing resources, that they are focused on your most profitable products and services. The problem is that many business owners don’t understand the true cost of goods sold, and thus the profit for each of their products and services. While consumables are readily identifiable, the labor and other business resources are not properly allocated, resulting in a distorted picture of the profitability of each product and service. In addition, the true cost of the sale for each has not been calculated.

As a result of an inadequate understanding of the profitability of the individual products and services poor marketing decisions are made by the business. More...

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Dr Greg Chapman is the Director of Empower Business Solutions and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success and Price: How You Can Charge More Without Losing Sales.

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Thursday, August 23, 2018

Microsoft Scam Alert

by Dr Greg Chapman

Recently I was contacted by a business claiming to be ‘Microsoft Authorised’ regarding a malware notification they had received from my computer network. The sophistication of the approach was quite convincing, but there were warning signs that I will expose here to protect others who may be contacted by this group.

The person ‘Mark’ claimed to be a Microsoft certified technician tasked with contacting users whose systems had sent automatic notification of their vulnerabilities. The purpose of the call was to show me how I could remove this dangerous malware which would infect all other computers on the network.

Wednesday, August 22, 2018

Married to the Business – Who’s the Boss?

by Dr Greg Chapman

Married to the Business is a series of posts about a couple who together run a building business. Mike is the builder and Lyn runs the office. (See earlier posts here.)

Up till now, Lyn had just ran the office. She would pay the accounts and issue invoices and pay the staff. She would balance the books and manage most the other office paperwork.

Mike met the clients, did the quotes, organised the onsite staff and contractors, co-ordinated the suppliers and oversaw the works. Almost none of this could be managed by Lyn as she did not have the technical background, but even she could see that things never seemed to go to plan. There was a lot of wasted time and fixing of mistakes, which Lyn believed should never have occurred.

Tuesday, August 21, 2018

Is Traffic Killing Your Business?

by Dr Greg Chapman

I live in Melbourne where the population has increased by 45% this century. Unfortunately, as anyone here who has travelled by road knows, the infrastructure growth that services the population is only a fraction of that amount. This means there is now no off-peak time when travelling. The traffic is always heavy. This is affecting any business that spends time on the road, and not just in Melbourne, but also in all big Australian cities.

Businesses that may been able to do 5-6 jobs a day can now only do 3-4, which of course means a hit to their turnover. Travel time is business dead time. How have businesses adapted?

It’s now common to see businesses that might have advertised to service customers Melbourne wide now just offering their services to people within say, a 20 minute travel time of their offices, but this travel time radius shrinks geographically as traffic inevitably worsens. How do such businesses survive?

Thursday, August 16, 2018

Professional Business Partnerships – Are Your Partners just there for the ride?

by Dr Greg Chapman

Partnerships are an effective business model for professionals such as lawyers and accountants. It is a great way of raising capital and provides an exit strategy for older partners as new partners buy in to the business. While partnerships can be a highly profitable, with partner turnover, the entrepreneurial spark can be diluted or even lost.

Consider how partnerships are founded. Usually 2 or 3 professionals get together to establish the firm. The early years are often a challenge while the business is building its reputation. Getting new clients is the focus of the business. The founding partners either are, or become effective sales people. This is critical to their survival.

Wednesday, August 15, 2018

Marketing Moments - Getting a Premium

by Dr Greg Chapman

The marketplace has never been more competitive, and it’s never been easier to compare. In fact some businesses, such as iSelect, are built of offering side-by-side comparisons. In such a marketplace, price shopping is the norm.

To win business without discounting, and to achieve a premium, it’s essential to be able to demonstrate the value you provide. This can be based on something the customer wants and can’t do for themselves, or something they don’t want to do themselves.

It’s important to understand the value chain in your sector. For example, some businesses are little more than intermediaries. They take the order, then contact someone else to fulfil it. The value they add is their contact list. They then find their margins being squeezed because their supplier wants more of the profit. The risk is, the customer discovers who the supplier is, and cuts out the middle man.

The value you add could be that you:

– Save them time
– Save them money or make them money
– Help them achieve a personal goal
– Make them look better to others

Monday, August 13, 2018

Ad of the Month – Innovation

by Dr Greg Chapman

Innovation is a great way of creating a point of difference. But what if you are producing a product that that is pretty standard, and perhaps not even your best customers want you to change? Why change the box it comes in!

Wednesday, August 08, 2018

Marketing Moments - A Going Concern

by Dr Greg Chapman

Accountants refer to a business as a going concern if it can function without the threat of liquidation for the foreseeable future, usually 12 months. That their current assets are greater than their current liabilities.

However, this doesn’t mean that the business is a going concern in the marketing sense. What would happen if you stepped out of the business? How long would it continue? Would the enquiries still come in? Would the sales still happen?

Monday, August 06, 2018

Being there when Your Customer Needs You

by Dr Greg Chapman

Ever been out walking, and you’ve felt a little peckish, and up ahead you see a convenience store where you know you can buy a snack for yourself. That’s why they call them convenience stores. They have predicted how you might feel, and where you might feel that, and voila there they are. Of course they are there whether you are there or not, but they are expecting you.


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Dr Greg Chapman is the Director of Empower Business Solutions and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success and Price: How You Can Charge More Without Losing Sales.

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Thursday, August 02, 2018

Discounting or Average Pricing

by Dr Greg Chapman

Everyone (including me) says discounting is a bad idea if you are using it as a way to increase gross profit through sales volume. For example, if your gross profit is 30% and you offer a 20% discount, you will have to double your sales, just to break even. It also creates a reputation for your business that your prices are negotiable. Not a great strategy.

Most people discount when they see their stock just sitting on the shelves and then they panic, but what if you planned to discount from the start. What might such a plan look like?

Let’s say the product cost you $30. Keeping the arithmetic simple, you decide to sell it at $100, a 70% margin. You don’t expect to sell many at this price, perhaps 10% of your overall sales. Next you decide to announce a 15% discount to your customers as part of a ‘mid season’ sale. You expect to sell 30% of your stock at this price. Remember, by having priced it at $100 initially, the 15% discount seems like good value, with the initial price being an anchor point.


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