Business Alone

If you are serious about starting a small solo business, there is no greater lesson to learn than how to apply the principle of maximum leverage to everything you do in your business operation.

Your survival, and ultimately your success, will hinge on how well you grasp the concept and make it your slave.

It's a difficult lesson for many, partly because most of us rarely practice applying leverage in our own personal lives. We tend to get complacent and accept low output and/or maintaining the status quo as our daily M.O.

I know, I know, we all use the term freely and without much thought.

But it really is wrong. A virtual business can't have assets, employees, products and customers.

The term "virtual" means a realistic simulation; of such effect that something appears to be real even though it's not.

Well let me tell you, Internet business is the real thing. It is a different kind of business because of the way it's operated and delivered; but it is as real, legal, and legitimate as any other physical business.

First, think for a moment about a traditional physical business.

Choose any store down the street you like or think about your favorite shop at the neighborhood mall.

Undoubtedly, it will have walls, a roof, carpet, employees, opening and closing times, products on the shelf (or some type of service that can be purchased), a cash register, counters, aisles, lights, bathrooms, advertising in the window, dedicated or shared parking outside, and many other things that all businesses have . . . or do they?

Try to imagine an alternative type of store with a single owner but no employees, no walls, no roof, no carpet, no bathrooms, no cash register, no counters, no aisles, no lights or other physical attributes.

Often, when a new businessman enters the market, he often forgets or totally ignores the cost of support for his products and services.

Depending upon the type of business you operate, that could be a very costly mistake. Why?

Because if you don't understand fully the expenses of doing business in its entirety, there is a good chance you will have a good portion of your profits consumed by these "hidden costs."

Especially in online information sales, the tendency sometimes is to assume that you won't have to deal with very many customer issues.

I believe it's a wise move to investigate all the options you have in executing your online business.

You may quickly dismiss many of these options for any number of reasons, but you might also find just that one perfect little advantage that sets your business apart from your competitors and propels you to success.

Drop-shipping could become your business "ace in the hole" so to speak, but there are many dangers in this industry so you need to be cautious and thorough in your research about the drop-shippers that you employ, their reputation for quality products and service, their fee structure, their policies, and your rights as the selling agent.

Some business owners have chosen to ship purchased products to their customers at no additional cost with the idea that such generosity could mean the difference between landing a sale or not, all other considerations being equal.

I would caution that you be very careful in implementing this strategy. If you choose to offer free shipping, that's certainly your prerogative as the business owner; but if your business can't really afford this luxury, it could become an awful drain on your capital.

Now, don't get me wrong - I'm not saying you should never employ this strategy. In fact, some businesses have used the "free shipping" tactic to differentiate and set their company apart from all the other competitors in their niche.

Have you ever noticed a shopping cart full of groceries sitting next to the checkout stand at the supermarket?

I've seen it happen a few times and usually figured that someone simply left their wallet or purse at home and would be back soon to claim their abandoned goods.

It's not a big problem since most stores are accommodating about the oversight.

But online, shopping cart abandonment is a huge problem! No one really knows the extent of this loss to e-tailers, but I have seen some estimates that suggest fifty percent or more of all online sales processes are never completed.

In the previous installment we discussed some of the costs associated with delivering physical products to your customers.

Be careful to study the numbers and understand exactly what it is costing your business on a weekly, monthly, and annual basis to send out your goods.

In most instances, it is best to charge your customers about what it costs you to handle and ship their purchase. The amount can vary a little from your exact cost so that you can standardize and simplify the shipping cost structure you present to your buyers.

The ways an auto responder can be employed to automate your business tasks are many. Here are just a few of the typical business uses of an auto responder:

- if an email address is no longer valid, a message can be sent from the mail server that the email is now "undeliverable,"

- if the business changes its email address or URL, a new forwarding address can be sent to those that send mail to the old address,

- if you go on vacation or are otherwise unavailable for a time, your auto responder can alert customers to your absence and when you'll return,

Having to ship merchandise out to customers reminds me of the hassle of shaving every morning. It's a part of the daily routine, it's something to be tolerated but it's never enjoyed, and the longer you let it go, the more difficult the chore grows for the next day.

In my mind, having to ship merchandise, keep inventory on hand, box and package products, etc, is one of the reasons I feel strongly about solo operators focusing on information based business only. There is no shipping.

If you ship merchandise, you have to keep merchandise. All of a sudden you are in the warehousing and inventory business that presents all kinds of extra manpower costs, worries and hassles.

By now you understand that the solo information business strategy discourages dealing in physical products that require shipping and handling. These products require human intervention and a lot of financial costs that are the antithesis of the one-person solo Internet home business model.

Nevertheless, many of you will continue to do business in a physical delivery world because of the types of products you sell.

So I have a few suggestions about shipping products that will hopefully help you in your business to avoid the pitfalls and traps that some solo businesses have fallen into in the past.

If you have a business based in the U.S. and you pride yourself on having the lowest prices in town (or in your industry), are you ready to be severely challenged?

One of the most evident changes that the U.S. economy has undergone in the past 15 years or so is the flight of industrial and manufacturing companies away from the U.S. Why?

Well there are a lot of reasons, but the basis of this exodus is the fact that labor in the U.S. is increasingly expensive and hard to find.

One of the first and most important tasks of any web site owner is to capture at least the name and email address of every visitor possible.

You want to be able to communicate with your customers and send them follow-up messages. You want to keep your business in front of the prospect, but you must have their permission and blessing to do that.

Often web site owners will offer a premium or freebie to the visitor in hopes that the exchange of the personal information for the freebie will be seen as a "fair trade" by the customer. But too often the freebie has no relation to the business or product of the owner.

Online business in today's marketplace has many advantages that the small business has never had in the past.

The challenge for the business owner is to take advantage of these advances and use them to grow his business in ways that direct competitors either don't know about or are too lazy to set up.

The advances are only an advantage if they're put to good use. That's why they are so powerful to you - because you know the strategies and can implement them into your business and others in your niche won't.

The manufacturers of the industrial era had at least one thing in common: they found that mass production could cut both product costs and production times by substantial amounts when work was compartmentalized and the flow of assembly was orchestrated to bring all the parts together at the proper time (on the assembly line) and sequence.

The expectation remains today that products can be made and delivered to the customer in record time.

You order a digital camera over the Internet today on your lunch hour, even from a dealer thousands of miles away, and you should be able to have it delivered to your front door by noon tomorrow, if all goes well.

The type of fraud I'm referring to is credit card or payment fraud as opposed to things like embezzling, tax evasion, or product scams.

The Internet presents a special environment for payment fraud because transactions take place all over the globe often without one or even two parties being physically present to inspect or insure that everything happens as it should.

Anonymity enables dishonest people to become bold and brazen.

Credit card numbers and individual identities are stolen everyday by the unscrupulous.

Web sites and shopping carts are hacked in every industry.

Abuse of the payment system is commonplace nowadays.

In my travels today I ran across a great site online that should provide a nice resource for you as a small business owner. At the very least, you can use it as a consumer to find just about any kind of product or service imaginable.

Often, solo business owners are in need of a particular service or piece of equipment that may not be available locally or within the surrounding area. Not to worry . . .

This resource I'm talking about is a business directory of sorts. What makes it such a good resource, however, is its search capability. You can search in any state or city in the U.S. and get great information about the business supplying the information.

Now searching for any type of service or product is a breeze. Not only will the search include the name of the vendor, it will also allow you to find all the contact information you need, web sites, email addresses and what kind of local competition there may be for a product.

When it comes right down to brass tacks, I would say every Internet business owner should consider herself or himself an information publisher.

It seems to me that all business web site owners need to be publishers of:
a) website information;
b) sales letter copy;
c) site content in the chosen niche;
d) products in digital or hard copy form;
e) blog content;
f) email communications;
g) customer service responses;
h) advertising / marketing copy;
i) articles and press releases;
j) probably other things I'm forgetting about ...

My point is, whether you consider yourself to be an info marketer or not, you really need to pay close attention to your publishing (i.e. putting it out on the net or in emails) and how it can affect your overall business.