Slow Times Require Quick Changes

The economy is tanking everywhere. Real Estate is down to 60 cents on the dollar. Stock Market is shaky. Things are bad and getting worse.

It is hitting my business and once again I have made a mistake that may kill the business.

History, normally I would rent every place I have during the months of June, July and August. The closer it gets to August the quicker the pace. It would get to the point where I would be begging Landlords for more houses to fill. However, this year it was bad. Houses that used to fill up in a day are sitting half empty even after three months. Not good at all!

It got to the point that Landlords were calling me more than perspective tenants loading my voicemail asking me what was wrong. What can I say? I did everything the exact same as last year where I was EXTREMELY successful filling everything. The economy is bad. School attendance is down. Everyone is looking for a deal and holding out for that deal. People are not making as fast a decision as they were last year. Little comfort for a Landlord that is facing a half or even almost fully empty house for the school year.

So I sat down and began to analyze it. What went wrong?

Then it came to me, "I NEVER ADJUSTED WITH THE ECONOMIC CLIMATE. I never took advantage of it.".

More fortunes will be made in the next couple months than all fortunes before it. People that adjust and see the glass half full will benefit. I always remember the saying, "Buy when they cry, sell when they yell." It is so true. Normal people run away when they even hear the fact that things may get bad. Rich people run to the chaos.

Back to my business. Once I realized this I began the changes.

1) I stopped wasting time on actions that where not helping the situation. For instance, I cutout unnecessary services such as staging apartments and focused on making sure they were clean.

2) I stopped wasting time on bargain hunters. They were literally taking up my entire day and in the end I was not making anything from them. I began to tell people in the beginning, the Landlords have discounted the price according to the climate and WILL NOT discount anymore. Most time-wasters would walk and save me hours to deal will REAL customers.

3) I aggressively looked for business and actually was surprised about how effective this was (more on this in a future post). I began handwriting signs, posting them everywhere I possibly could. I would go up and down the street and talk to everyone looking for tenants.

4) I focused on my strongest (and most money making) skill, sales. You can always see when someone wants something. If I didn't see the glow from them, I moved on. If I saw it, I would not negotiate and waste time. Take it or leave it. The price is what it is. And 99% of the time they would take it.

The other thing I know I did wrong was I didn't adjust my moral thoughts on the business. I have always tried to fill places for Landlords. It was how I built the business reputation so quickly. But it was not possible this year to do that because of the climate. However, I knew I would do my best and that's what I could offer them.

What I should have did was taken on 100 times the Landlords I had with the caveat, "I cannot guarantee a full house but I can guarantee you will not be sitting with an empty house like everyone else is."

The perceived service would not have been as high as it was but neither is the ecomony.

Remember fortunes will be made NOW by people that can adjust quickly to changing times, even a change of business morals may be needed to get through it.

The $90 Subway Lunch.

We recently spent a life-moment day at Cedar Point. Seven of us. After a full morning of thrills on the Raptor, Top Thrill Dragster and even the high speed horse race ride (yes I admit I rode the kiddie rides) we stopped at Subway to get a quick bite before heading out again and risking throwing it up. There was no line up, which in itself was weird. We ordered three 6" and two foot long Subs, comboed them and went to pay.

It came to over 90 bucks!

I said, "Did I hear that correctly? 90 bucks?"

A couple of subs that normally cost maybe $30 at the MOST came to half the price of an IPOD Nano! Nothing special about them either. Just plain subs. No coupon for a free IPOD shuffle, just some lunch meat and Pepsi. This was enough to bring 2 more people into the park for the day!!!

What was confusing was the menu board. They presented it in such a way that you would NEVER figure out how much you were going to pay until you were at the register -- and by then it was too late. There was three problems with this method of doing business:

1) You are only making customers mad. The girl actually told me almost everyone freaks when they hear their total Sub bill. How are you going to keep customers if they are expecting to pay $30 and it comes to $90. Bad business!

2) There was nothing special about it except they had a Subway dude you can have your pic taken with and the fact you can eat a familiar meal while enjoying your exciting day. They should have at least gave a ticket for a free park souvenir.

3) The menu board does not keep in the tradition of the most successful business lesson: "Remain Consistent". McDonalds serves billions because EVERY McDonalds has the same menu board, etc. People want the same experience, no surprises!

If they would have raised their prices slightly and stayed consistent with the menu board I would not have even thought about it. I mean I love Subway! However, I guarantee I will think twice about buying lunch at a Subway at any special venue now. If it was your business, wouldn't you have thought twice about possibly losing a customer just to gouge them for $60?

Comparing Apples with Oranges

Companies often compare apples with oranges while dealing with competitive issues. Big mistake. Your customers are smarter than you may realize. Do not insult them. Compare apples with apples.

Background: A friend recently told me where to get DSL service for $19/mn which is EXACTLY comparable to the service I am getting from the phone company for over $50/mn. Speed is same, service is same, everything. I've been with the phone company for years and have been relatively happy with it so I entered their chat program to talk to a rep about possibly getting a price match.

Once we got over the identity verifications (which takes longer than a conversation now) she said she could offer a bit faster connection for $40/mn, I have to sign a 1 year contract and pay a $100 fee. OK, so when you break this down, I would be paying the same for a tiny bit more speed (which the modem they gave me 5 years ago will not handle anyway).

So they are trying to compare a $50 orange with the $19 apple instead of a $50 apple with $19 apple.

Why would anyone buy an apple for $50 when they could get that same apple for $19 next door? Is it because they think their apples are better, their store better or because the apple is in a better display? Is it because they have spent 100 years selling apples and know more about apple pricing than you?

Companies have gone out of business making these same assumptions. In fact, the phone company I am referring to had years ago lost over a million customers by merely placing a cap on downloaded bytes. The mailboxes around town were so full of modems being returned to the phone company that I am sure the post-office freaked.

OK, not only are they going to lose me as a long-time loyal paying customer but I will now recommend this same $19 apple to about 100 clients (landlords and tenants). Why? Because the phone company tried to hide the fact they can't sell me their apples for $19 or anything even close to that -- they can only sell me a $50 orange.

Imagine the competition salivating at the phone company's responses to their current customers. If I was them, I would start a campaign and hand out a free apple with each new account, just to stick it to them. Poor large corporation. I think they have created more competing entrepreneurs than any industry.

A-Team 80 Cult Heros or Business Mentors

I love the A-team. They were tops in the 80's when I was a kid. I remember risking parental fury each time I watched it, but I knew someday it would pay off!

Here is a group of dissimilarly skilled people led by a knowledgeable leader that had good intentions in mind. Does this sound like the perfect business or what?

Why is this so important to remember now?

I am once again trying to take on too much of the business. I know others can do it better and I try to rationalize it has to do with money, but people know more than I do and are smarter than me. Do you do the same?

Get over it!

Some of the most successful companies in the world are run by people that simply know how to lead. Nothing else.

But what is leadership?

I remember once telling a vice president that leadership is when you can get someone to follow you despite everything they personally know about you. In other words, would you follow this guy/gal to death?

I NEVER in a million years thought I would become that person. But I am convinced now, I have become that person. Sounds arrogant but that is what you need. Hannibal was arrogant, confident, knew his sh!t and was not afraid to make mistakes. All qualities of a leader.

However, the most important quality he had was his ability to turn over the "responsibility" to those he led.

OK, I am an 80's TV junkie but look where it got me!

To Boldy Go Where No Marketing Has Gone Before

I am diabetic type I (insulin dependant) and have been so for 15 years. Each day I am supposed to use a meter to measure my blood sugar and record it into a "log book". The doctor then uses the book to determine my progress or to adjust the medication.

The nurse recently gave me a couple new free log books. The meter companies give them away like candy (ok sugar-free candy).

Imagine my surprise when I begin using it and every few pages there is an ad for one diabetic product or another. Coupons are even included which I would actually use. Absolutely brilliant marketing. Commercials have reached my LOG BOOK!

Why?

Where else are you going to be able to get your AD before the eyes of 100% of your target market; diabetics?

If the companies would have put ads in a magazine, the average of diabetics that would see it would be exactly the national average of diabetics; about 7% of the population.

Man if I would have thought of that I would be charging these companies a fortune to advertise because now 100% of their advertising dollars are used to reach 100% of their target market. Such a deal!

It is exactly like putting an ad for color prints inbetween shots on a digital camera. Or think of a printer that printed a coupon for 1/2 off your next ink cartridge at Staples at the end of the cartridge. Wow, the possibilites are endless.

As I always say, know they customer to the point of almost knowing their name. Then only advertise to them; not the rest of the world.

For more information on marketing, check out this great site: http://www.psychotactics.com/marketing-strategy

Whatever the Mind of Man Can Conceive...

When I first got my last job I was so excited. I used to ride the train with a good friend of mine and he asked me one day, "How is it going at the new job?"

I said, "Great! I am getting paid to think".

He says, "That's funny, I get paid NOT to think!"

Three years after he said it, I can see why he said it.

Businesses that are growing require a huge inflow of ideas to turn to cash. It is a SIMPLE process. Think of good ideas based-off business experience and turn it into cash as fast as you can. Refine the idea. Do it over and over and over. It's the nature of business.

However, once a business matures, the "ideas to cash" process turns to these policies or rules instead:

1) Do what you are told. We are the experts and we didn't think of it, so how could you have. (untrained, inexperienced managers stating this)
2) If you think of ideas to improve profits, write them down and put them in the suggestion box (in other words, trash!).
3) Ideas cost too much to implement. (when, in fact, they cost too much to not implement.)
4) We need to take that idea through the RFQ, RFI, blah blah process to determine its advantage to the company's bottom line. (in other words, bury it in paperwork).

The basis of Napoleon Hill's book "Think and Grow Rich" is "Whatever the mind of man can conceive and believe, it can achieve."



Always encourage these ideas to flow from your employees, friends and family and develop them FAST! Don't turn this money generating machine (the human mind) into, well, a robot.

Scare Yourself To Riches

I'm reading a book called, The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich. I'll cover many points from this book in the future but the one that stands out the most is the ability to push your comfort-zone everyday. In other words, do something daily that you fear doing.

Timothy Ferriss gives the example of asking a member of the opposite sex for their phone number. For me it is dealing with difficult customer interactions. It's taking every call even though I know some will lead to my blood pressure rising. It's also not being mister nice guy.

Why does he suggest doing these things that make you uncomfortable? Because it puts you in a catagory that 99% of the population is not in - success or the ability to achieve great things JUST BECAUSE YOU TRIED!

I will give you an example. Who do you think is going to be more successful and richer: a saleman that is not afraid to knock on any door in the city or someone selling ads on their blog that has never talked to a single person or had face time with one customer?

Both can be successful but the second is not pushing their fear limits daily. It is too comfortable.

There is nothing wrong with comfort but the problem with it is you are competing with 98 other comfortable people for that same dollar. Where if you were pushing the limits each time you interact with someone, there is likely NO ONE TO COMPETE AGAINST.

People are asking me if x business would be successful. I now ask, "Does it scare you to do it?"

If so, get ready for the riches.