Episode # 24 – I Will Not Be Run Over By The Economy
This is another installment of More Than a Few Words
As a small business owner, there are days I feel like I have been run over by the economy. There I am minding my own business, driving along, when along comes the economy moving full speed ahead in a downward direction.
It is easy to make excuses and let the impact slow me down! But I have big plans for 2010, so I konw I can not let the external factors like the continued sluggish performance of the economy distract me from my goals and objectives.
What about you? Do you have a plan to keep your small business focused? That is the topic of today’s pod cast!
Shop Local!
As the internet makes the world seem smaller and smaller, it is easy to forget that you are part of a local business ecosystem. As you make purchase decisions you choices impact the local economy. If, like me you are concentrating in a specific community, hoping to generate revenue from the community, then you need to put money into that community.
As consumers, we have power. Use it to actively support the businesses you care about and force change in the ones we don’t. Seth Godin summed it up well when he said:
If you don’t like what an organization stands for, work actively to spread the word and force them to change
AND
If you will miss a product, a service, a book, a site or a professional when they close up shop, stand up, speak up and bring them masses of new business.
This was the theme of my presentation at Rainmakers last month. ( I just got the video links) . The video is in two parts and it contains a serious call to support local businesses.
With this local focus in mind, I thought I would share just a few of my favorite local restaurants. These are places I would miss if they were gone. . I hope you will consider voting with your dollars this holiday season, paying them a visit, and helping to build a strong local economy.
No links to websites sorry, but more importantly I have listed address so you can check them out yourself.
Ocean World on 86th Street and Ditch. Some of the best and most reasonably priced sushi in town. The food is so good it is easy to overlook the mediocre service. It is usually busy, but not overcrowded at lunch time, 1/2 prices specials on Sunday, and always a long wait on Friday night.
LaPeidad 6524 Cornell Ave – Great, authentic TexMex. Fast friendly service, good food, reasonable price. Nice outdoor dining when the weather permits. When I need a TexMex Fix this is my favorite.
Kona Jack – Meridian and 96th Street – Not to be confused with the Kona Grill chain in Clay Terrace. This Indy tradition has a wonderful, diverse fish menu, and even sells fresh fish for you to take home and prepare yourself. Sharing a kitchen with Daddy Jacks, you can often convince your waitress to serve something off the menu from the other side.
Santorini Greek Kitchen – 1417 Prospect Street, in Fountain Square – Well worth the trip to Fountain Square for the huge portions, home-style Greek food, and great service. It is also the only place in the city that makes Eggplant parmesan the way I like it – I think you will too.
These are just a few of my favorites. What are yours? List them here, and more importantly, pay them a visit this month!
Local Economic Ecosystem
At the October Rainmakers meeting, I had a chance to talk about my passion for LOCAL business and the impact we make every day with our purchase decisions.
This is just a short excerpt from the program, the rest of the presentation will be available on the Raincast soon.
The Local Economy – by Lorraine Ball from Dave Anderson on Vimeo.
Friends Don’t Let Friends Buy Starbucks
The other night, I think I surprised a number of people with my presentation at the Rainmakers Main Event. Folks in the audience who are familiar with my typically motivational, marketing and personal development messages, were introduced to my other passion : local business!
In a brief 15 minutes I advanced the argument that as business owners, we need to go out of my way to support other local business owners. If we don’t support and promote these companies, they may not be there when we need them.
Asking the audience to think about the companies they would miss if the businesses closed their doors tomorrow, I was surprised by the range of responses. From local coffee shops and resutants, to a neighborhood dry cleaner and a web hosting company it was clear we as a group depend on these local companies and need to do more to insure their success.
And it just isn’t enough to talk about it. We need to put our money where our mouth is, and shop local. If we are annoyed when the ICVA hires an Ohio based marketing firm, then we have to stop drinking at Starbucks and support our local coffee shops. Erik Deckers explains the cost of this choice in a follow up post he wrote Wednesday morning:
In fact, out of every dollar you spend at a local business, 40 cents of it stays in the community. When you spend a dollar at the big chain stores, 13 cents stays in the local economy.
Every time I have Starbucks, a the majority of my expenditure leaves the Indy economy and heads to Seattle. Now don’t get me wrong, I have nothing against the people of Seattle, but they aren’t sending me any money! So until I get a client from Seattle or those people simply start sending me money, I won’t be sending them any more! Look for me at LuLu’s and Hubbard and Craven instead.
Remember, Friends Don’t Let Friends Buy Starbucks!
Shake it Off and Step Up
I heard this old story recently and though the message was especially relevant to small business owners, especially in tough economic times.
There was a farmer had who had a very old donkey. One day, the donkey slipped and fell into the well. The farmer looked down into the well and realized there was nothing he could do to lift the donkey out of the well.
He decided it would be far kinder to put the donkey out of it’s misery quicly, then to let it slowly starve to death. He asked several of his neighbors to help him shovel dirt into the well, thinking they would bury the animal alive, and it would die quickly.
At first the animal howled as the dirt began to fill the well, but after a few minutes there was silence. The farmer peered over the rim of the well, and was amazed by what he saw. Every time a shovelfull of dirt hit the doneky’s back he shook it off and took a step up on the dirt. Shovelfull, after shovelfull of dirt fell into the well and onto the donkey. And each time the donkey shook it off and stepped up until eventually there was enough dirt underneath the donkey that he could climb out of the well by himself and trot off into the field.
The moral to the story is very simple. Life is going to shovel dirt at you. You have two choices:
You can be buried alive by the dirt life throws at you
or
You can shake it off and step up
If you want to be survive a down economy and be truly succesful in a rebounding one you have to keep moving, shaking off the dirt life throws at you.
Local Business is Key!
As an advocate of the Indianapolis Small Business Community, I am often frustrated when I see our city and state government spending money to support the large business community and ignoring this vital segment.
Most recently I read about Indianapolis investing in training companies how to do business with firms in Taiwan and increasing economic development activity focused on bringing more, bigger companies to Indy.
While important, I am frustrated by the mathematics. There are 65,000 small businesses in the Indianapolis metro area, with sales under $1 million. That is 65,000 chances for success!
This article by Jeff Stibel, from the Harvard Business Review suggests I might be right after all, and gives some very specific suggestions for outsourced execs considering a switch to small business ownership. He says:
- Action. This is an entrepreneur’s best weapon
- Planning is important. Plans aren’t.
- Innovative financing
- Give the people what they want
Rest, measure, refine, repeat
Pull Your Head Out of The Sand … Unless You Want to Be Buried There!
The ostrich is a strange creature. When frightened it will bury it’s head in the sand, convinced if it can’t see the danger, whatever is creating the threat can’t see it either. Over the last few months I have noticed a number of small business owners behaving like an ostrich. Instead of facing the challenging economy head on, the are hanging around with their heads buried in the sand, hoping they can ride it out!
But it doesn’t work. Hiding with your head in the sand is a good way to get run over, or simply miss an opportunity that comes along. Now more then ever, small businesses need to be making and executing growth plans, investing in their business and reaching out to existing customers and prospects.
Seth Godin touched 0n this topic in a post entitled Death Spiral as he cautioned small business owners against trying to shrink their way to greatness. He provides several examples of how companies sabotage their own survival by trying to cut back when things slow down:
The fish monger sees a decline in business, so they have less money to spend on upkeep and inventory, so they keep the fish a bit longer and don’t clean up as often, so of course, business declines and then they have even less money… Eventually, you have an empty, smelly fish store that’s out of business.
The doctor has fewer patients so he doesn’t invest as much in training or staff and so some other patients choose to leave which means that there are even fewer patients…
The newspaper has fewer advertisers, so they can’t invest as much in running stories, so people stop reading it, which means advertisers have less reason to advertise which leaves less money for stories…
What should you be doing? Invest now! Invest wisely, but spend some of your available cash on marketing, new product development, system development which will allow you to provide better or expanded services to your clients. As Seth says:
Right this minute, you still have some cash, some customers, some momentum… Instead of squandering it in a long, slow, death spiral, do something else.
Big Connections, Big Ideas!
On a regular basis people tell me people in Indiana aren’t as cool, hip, smart or interesting as people on the coasts. And I just don’t believe it. I have found some amazing, passionate, interesting people with life changing idea, right here in Indiana. And yesterday about 275 of them gathered at the Cabaret Theater for the Inaugural Smaller Indiana, Bigger Ideas Conference.
If you were there, please share your thoughts. If you weren’t here is just a taste of what you missed with some of my favorite quotes and thoughts from the day:
Scott Massey -
- Leaders need to be four things: Scout, Knower, Witness and Conduit
- The pace of change today should change how we think about ‘change.
- If your not doing something that is bigger than you, you may be wasting your time
- And an intriguing question for Scott: What constitutes work in a concept economy?
Jenni Devoe
- Your old customers want to cast you in your old mold. Want to change the direction of your business? Change your customers!
- You’re not going to get where you envision being if you don’t first take the time to envision being there
- Dream until you die
Mark Hill
- It is about mote than ideas. It is about execution
- Wishful thinking is the enemy of execution
- People that are successful are the people that do what they say they are going to do.
- Find something you’re passionate about and you’ll never have a job
Sally Brown
- Quoting Helen Keller: Life is a daring adventure or nothing at all
- Measure your success with something other than money
- Ask yourself four questions. What can you do? What should you do? What will you do? And How will you inspire others
David Forsell
- Life is a gift
- It wasn’t that David had less to say then the other speakers, I was just so wrapped in his story, that I stopped taking notes. I hope someone else will fill in the blanks
Ken Johnson
- If you are the smartest person you know, your circle is too small
- Then mentality of low expectations is all around us – Call for greatness!
And then there was more… Jon Ketzenberger and his panel left us with a few more thoughts but I was running out of steam. My favorite from the panel discussion:
- – We don’t have to embrace fear when we have the resources to embrace innovation.
And from some of the attendees:
- Jon Speer ( @creoquality) summed up the event in three words Passion, Connect, Execute
- Mike Magan ( mikemagan) Indiana is in the early stages of a positive transformation.
And along with the speakers and the panel, were the unexpected performances from the Indianapolis Ballet Company and “Married to Magic” performers from IndyFringe.
For more, check out the Twitter Stream at @ #SIBI and www.smallerindiana.com home page for the videos when they go live in the next few days!
Start Up Fuel
In the last few months I have seen a number of people write about the amount of innovation we can expect to come out of the current economic recession. Many people talk about necessity being the mother of invention and the shift from larger to small, and as I started reading about Y Combinator that I got a real glimpse of this incredible innovation in action.
In just a few years, Y Combinator has funded 150 different software and Web services startups, with small investments: $25,000. But more then the cash, it is the co-location of these firms, housed together at Y Combinator which I believe really makes the difference.
Scott Anthony, writing for the Harvard Business Review summarized four elements of their model which he believed were a cornerstone of their success:
- You can do a lot for a little. It amazes me when corporations complain that they lack adequate financial resources for innovation. With open source software, online market research tools, and the ability to create virtual prototypes, you can do a huge amount for $10,000. A lack of financial resources is very rarely a rate limiter.
- Tight windows enable “good enough” design. Most Y Combinator–funded companies are expected to release a version of their idea in less than 3 months. That tight time frame forces entrepreneurs to introduce “good enough” software packages that can then iterate in market. This approach contrasts to efforts by many companies to endlessly perfect ideas in a laboratory, only to fail the real test of being exposed to real market conditions.
- Business plans are nice, not necessary. Y Combinator doesn’t obsess over whether entrepreneurs have detailed business plans. Again, the focus is getting something out in the market to drive iteration and learning. After all, if you are trying to create a market, most of the material in a business plan is assumption-based anyway.
- Failure is an option. One of the benefits of the Y Combinator approach is it forces quick decision making — if the team can’t produce a prototype, or the prototype bombs in market, the end comes quickly. And the low, up-front investment makes it easier to wind down ideas. Corporations that say they lack resources often have those resources tied up in the wrong projects. Saying no is not a bad thing.
Maybe we need more Y Combinators – VC companies lead by former entrepreneur’s who will push, prod, and coax start ups, encourage them to share ideas, information and resources, and learn from each other. If small is the new big, then companies like Y Combinator are are the center of it all.
I am Unemployable – And Proud of It
Four years ago, an old friend called to offer me a job. It was tempting. We had worked together in the past and I liked, respected and trusted him. It was a job for which I was well suited, in an industry I knew well, for a solid company with a good reputation.
At the same time, Roundpeg was struggling to find a place in a crowded market. Working for someone else seemed easy way out. But half way through an interview which began with a hug from my prospective boss, I knew it was a mistake and so did he. Why? After several years on my own, I no longer fit in a corporate environment. I had truly become a Roundpeg with no ability to fit the square holes of a corporate structure. At that moment, I knew failure was not an option. If I could not return to my life in corporate America, I had to make Roundpeg a success.
Accepting there was no turning back forced me to look forward, double my efforts and ultimately double my business.
With the current economic downturn, I meet many reluctant entrepreneurs; downsized executives who think they will start a business but secretly hope to find a job. After 6 – 9 months they discover they haven’t been successful at either. My advice; commit 100% to one path or the other. If you try to straddle the white line in the middle of the road you will get run over! Embrace the fact you are unemployable, start your business, have fun and succeed!
If you are looking for a resource to guide your journey, check out Escape from Cubicle Nation by Pam Slim.
