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HOW TO SURVIVE THE RECESSION ... STRONGER THAN BEFORE
As bad as it is out there, it's important to recognize that this is a time of tremendous opportunity.
Get my free report, "How to Survive the Recession ...Stronger than Before" by replying to this email or by calling the number above.
WORTH READING
Selections from the best articles seen online this month.
Five Questions to Build a Strategy
From Harvard Business Review
My preferred approach is to treat strategy making as developing a set of answers to five interlinked questions.
On Writing: Accentuate the Positive
By 37Signals
Tone makes all the difference in the world. Which one of these emails would you rather buy from?
Do It Anyway
By Steven Pressfield
This is an important post. I say that because this piece addresses (after procrastination, which is the #1 champ) the single greatest excuse/reason/cop-out that prevents aspiring writers, artists and entrepreneurs from taking action to pursue their dreams. That excuse is, "First I have to _________."
BOOK REIVEW
The Sticking Point Solution,
by Jay Abraham
As the economy struggles to pull out of recession and many businesses are finding it harder to win profitable customers, the title of this book is timely: Many businesses feel stuck.
For anyone who has been a student of Abraham, there isn't a whole lot that is new in this book. But for those unfamiliar with his work, The Sticking Point Solution is an excellent starting point.
Abraham's teachings include the importance of tracking your marketing to measure what gets results, employing leverage in all aspects of your business to make the most of every dollar earned, finding partners who will take you to customers in return for a percentage of income, and positioning yourself in the market as a trusted advisor rather than someone just selling stuff.
This is all excellent advice, and the book is packed with actionable strategies.
Fine-tuning your business is super-important right now. This book will help you do that.
WISDOM
Quotes by...
Mary Kay Ash
"Sandwich every bit of criticism between two thick layers of praise."
"Don't limit yourself. Many people limit themselves to what they think they can do. You can go as far as your mind lets you. What you believe, remember, you can achieve."
"We must have a theme, a goal, a purpose in our lives. If you don't know where you're aiming, you don't have a goal. My goal is to live my life in such a way that when I die, someone can say, she cared."
"If you think you can, you can. And if you think you can't, you're right."
Mary Kay Ash was the founder of Mary Kay Cosmetics
QUICK QUIZ
Each month I’ll give you a new question.
Just reply to this email for the answer.
In what story did Sherlock Holmes make his debut?
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FINANCE
HOW TO IMPROVE YOUR CASH FLOW
It's a common lament among small-business owners and solopreneurs: "If I'm making so much money, why am I always broke?"
The problem often boils down to the difference between net income and cash flow.
Net income is the bottom line, or the profit or loss that is recorded on your income statement after accounting for all business costs and expenses.
Cash flow is money that has been collected and is available for you to use.
The income statement is updated whenever you make a sale or complete a job.
However, you may not see payment for these activities for 30, 60 or even 90 days. Even though you have generated revenue, it is not yet available as cash for you to spend.
A drastic imbalance between net income and cash flow can lead to a situation where you are generating healthy profits from your business activities, but you don't have enough cash to cover expenses such as overhead, labor and materials.
The money has been earned and recorded, but it hasn't been collected and thus is not available to support your operations.
There are a number of ways that cash can get trapped on the balance sheet.
The two most common are for customers to delay payment on receivables and for inventory levels to get out of hand. Here are some ways you can avoid falling victim to your sales success by running out of cash:
- Monitor cash flow regularly. Get into the habit of staying on top of the amount of money you have available at all times.
- If your cash flow level falls below a certain threshold, or if you see an adverse trend developing, look into financing options before things reach a crisis point.
- Use payment policies that enhance cash flow services. Ask customers to make deposits on their orders. Offer discounts to those who pay up front, or use a tiered payment schedule that encourages early payment or pre-payment for goods.
- Take advantage of your creditors' payment terms so that you retain use of your cash for as long as possible.
- Ask suppliers for flexible payment terms as these can be more beneficial to cash flow than discounts or low prices.
- Avoid keeping excess inventory on hand. Use a just-in-time inventory management system, buying what you need only when you need it.
- Issue invoices promptly and follow up on payments that are past due.
There are many examples of good, solid companies that failed because they could not generate enough cash.
Cash flow is a better metric of a company's financial health than net income.
Indeed, operating cash flow is the lifeblood of a company and the most important barometer that lenders and investors use to measure a firm's financial health.
Your cash flow statement provides immediate insight into your financial position at any point in time and reflects your ability to remain solvent in the near term.
MARKETING
HOW TO MAKE VIDEOS YOUR CUSTOMERS WILL WATCH
 Online video marketing is a great way to communicate effectively with Internet shoppers, especially the affluent, web-savvy Gen Y demographic. Video offers a fast, highly sensory way to engage viewers in real time and to present products, services and marketing messages.
But video is a complex, multidisciplinary medium.
Prominent Placement: Where you place a video on your website is key to whether it will ever get noticed. Make it obvious. Be sure the invitation to view it has plenty of screen real estate.
Short and Crisp: The average attention span of a web surfer is measured in seconds. In Internet video time, two minutes can seem like an eternity if content is static and lifeless. Be sure to let viewers know the length of your video.
Recurring Theme: A well-crafted video is knitted together with a strong motif, such as a color scheme, thematic background, graphic pattern and/or typeface.
Visual Choreography: The editing pace of an online video should be similar to that of a TV commercial. The average length of a single shot is about five seconds, just long enough to demonstrate a feature, make a point or transition from one topic to another.
Soundtrack: Video is more than simply a visual medium. Effective video combines sound and vision into a cohesive whole.
Online video marketing can be a key business differentiator for your company.
Effective video communication requires a blend of compelling content, creative visuals, rich audio and novel approach.
Picture credit.
MARKETING
PULLING A 'RICHARD BRANSON' MAY BRING YOU MORE BUSINESS
 Richard Branson, the flamboyant and irreverent founder and chairman of the London-based Virgin conglomerate, is as renowned for his wild publicity stunts as for his business acumen.
His crazy, daring exploits and feats of showmanship have given the Virgin brand an inimitable cachet.
He uses every outlandish publicity stunt as an opportunity to promote the Virgin brand, flaunt conventional business wisdom and tweak his buttoned-down competitors.
Virgin is a $3.5 billion international mega-enterprise, and the brand can be found on everything from condoms to wedding gowns and transportation services to financial services.
Branson's antics to promote the Virgin brand include driving a tank down Fifth Avenue in New York to introduce Virgin Cola to the U.S., breaking records in high-profile hot-air balloon adventures and portraying a drowning victim in an episode of Baywatch.
He reportedly devotes a quarter of his time to public relations activities.
Although zany, his publicity stunts are carefully planned and always congruent with his business goals and strategies.
Have you ever thought about pulling a "Richard Branson" and doing something out of the ordinary to market your business?
Using yourself as a promotional strategy can be an effective way to gain attention and distinguish your brand.
Publicity stunts don't have to be dangerous, just creative and newsworthy.
Your aim is to get people talking, make them aware of your products or services, and promote your brand in a clever way.
And maybe have a little fun along the way too.
FINANCE
WHAT YOU NEED TO KNOW ABOUT DEPRECIATION
Depreciation is an income tax deduction that lets you recover the cost of certain property. To qualify as a depreciation deduction, property must meet the following criteria:
- You must own the property.
- You must use the property in business or in an income-producing activity.
- The property must have a useful life of more than one year.
Most types of tangible property and equipment are depreciable except for land. In addition, some intangible property, such as patents and copyrights, can be depreciated. You may also depreciate the cost of capital improvements on leased property.
Depreciation begins when you place the property in service for your business and ends when you have fully recovered the property's cost or when it is retired from service, whichever happens first. If you use the property for both business and personal purposes, you can deduct depreciation based only on your business use of the property.
IRS Form 4562, Depreciation and Amortization, is the form used to report depreciation on your tax return.
Straight-line depreciation is the most common method of depreciating assets. However, in order to reduce tax liability as soon as possible, some accountants use other approved methods to accelerate depreciation and record larger amounts of depreciation in the early years of an asset's life. Check the regulations published by the Internal Revenue Service and your state taxing authority for specific rules regarding depreciation and methods of calculating depreciation for various types of assets.
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