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The Leading Edge January 2013
Small Business Success
Taking Care of Business  

    Contents
In this Issue

6 Tips for Ensuring a Successful Start to 2013

Crowdfunding - Small Business Applications

SEO - What the heck is it?

Is Outsourcing a Good Idea?

Advertising - A Sticky Business

THE LEADING EDGE - your monthly link to groundbreaking ideas for entrepreneurs

Top 10 Crowdfunding Sites For Entrepreneurs

Crowdfunding will be huge in 2013 as more small businesses use it to test market new products and raise project funding. Check out the leading crowdfunding sites to learn more about this major new trend. Read more...


Small Business News:

CFIB's 2012 best and worst list - With 2012 coming to a close, CFIB is sharing its list of the best and worst developments affecting small business. The "worst" list includes provincial finance ministers giving serious consideration to expanding CPP, and Visa Canada hiking credit card processing fees. The federal government, Quebec and New Brunswick made the "best" list for their efforts in fighting red tape. News Release: 2012 CFIB small business roundup: Who was naughty? Who was nice?


Canada's economy faces challenges in 2013 - In reports issued separately on Wednesday, the International Monetary Fund and CIBC World Markets Inc. laid out their predictions for 2013.
Both forecasts warn that Canada is likely to be hit with lower commodity prices, and say that if the U.S. drives over the fiscal cliff early in the new year, Canada will have no choice but to go along for the ride. They also suggest that 2014 will be a better year. Read more...


2012 IN REVIEW - The year's most popular small business stories published in the Globe and Mail. Here are ten great stories to get you thinking about anything from H.R. to social media. Read more...


Business Barometer: Small business confidence drops in November - Toronto, December 5, 2012 - Optimism among Canada's small- and medium-size businesses declined in November, according to the Canadian Federation of Independent Business (CFIB). The Business Barometer® index fell from 65.6 in October to 62.9. Read more...


A look back at the tech trends of 2012 and what's expected to develop in 2013 - Here's a look at the trends that emerged in 2012 and are likely to develop in the year ahead, and the busts of the past year. TORONTO - Another year, another iPhone. More surprisingly, Apple fans were tempted with not just one new iPad, not two, but three, including the latest mini-sized tablet. Research in Motion released new phones but not many noticed. There were baby steps made to introduce mobile commerce to Canadian consumers, while digital video viewing went mainstream. Read more...

 
    6 Tips for Ensuring a Successful 2013
 
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Taking the time to think about ways to start the new year off right is never wasted effort. Each new year brings the promise of a brighter future for professionals willing to take stock and make a conscious effort to achieve greater business success, by either increasing revenues or decreasing costs. Below are six tips that will help you launch 2013 with new energy and positive changes.

  1. Sit down with all employees and have an open and frank discussion your about suggestions for increasing efficiency or revenues. Employees see things that owners and managers sometimes miss. This often untapped resource offers a wealth of valuable information. Meeting with employees to discuss ways the company can improve is good for employee morale and also a great way to obtain fabulous ideas to improve your bottom line.

  2. Prepare cash flow projections for the new year. One of the major downfalls for many businesses is cash flow crises. In fact, this is how many businesses end up failing. By having a clear picture of the cash the business needs from month to month, management can plan ahead. One strategy that has proven to be a lifesaver to many is to obtain a line of credit while business is good, so that it will be available for the proverbial rainy day that most businesses experience.

  3. Get visual on social media sites to attract more attention. Research shows that photos, infographics, and video are the most shared data on the Internet. Since the purpose of social media for business purposes revolves around attracting prospective customers, then increasing the probability that your messages get noticed makes good sense.

  4. Review the past year and decide what business strategies are working, and which need to be reconsidered. Proceeding into a new year with strategies that aren't working for lack of analysis, or as the result of old habits, is to be avoided. By evaluating marketing strategies, customer service results, and production efficiency, management can begin 2013 with confidence that they are maximizing the benefits of workable strategies and trying new ideas to take the place of old failed ones. Smart entrepreneurs recognize the constant need for ongoing analysis, and business model adjustments, to adapt to the changing business landscape.

  5. Be sure that the company website is compatible for mobile screens. Trends indicate that increasingly people are buying smartphones, and using them to conduct research for buying purposes. If they pull up your corporate website, then you want them to be able to read it easily.

  6. Survey your customers offering a gift card, or free products or services, for the best innovative idea they have to improve your business. Getting customers involved in your business success achieves two positive goals. First, customer involvement breeds loyalty and second, customers can tell you what they want changed so they will be happier. By making this a contest of sorts, customers may take the survey more seriously and really think of some new ideas about how to improve your business.

Smart entrepreneurs recognize the need to make healthy changes to ensure continued success. Given the trial and error nature of running a successful business, it is important to try to anticipate industry trends and get a jump on the competition. Many businesses fail due to the manager, or owners, refusing to make necessary changes in order to adapt to changing market conditions. An annual check-up incorporating the ideas listed above is a good way to be sure your business is positioned for future success.

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Crowdfunding - Small Business Applications Top

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Crowdfunding as it currently exists allows anyone to raise money, through donations, for any project they are working on through dedicated crowdfunding websites. Projects can be anything from an individual writing a book to a company launching a new product. In fact, people are even using it to get strangers to fund their medical bills, but that is another story.

New legislation recently signed by President Obama will soon allow small businesses in the United States to raise equity funding through crowdfunding websites, which is seen as a major advancement in crowdfunding, especially for small businesses (The Canadian Securities Commission is currently looking at similar legislation). This new legislation allows businesses to use Crowdfunding platforms to raise money for special, or startup, projects.

Crowdfunding businesses promote projects via the Internet so the public is aware of the details and can donate to the cause if they desire. Crowdfunding investment platforms currently include three different business models. The three types of organizations include lending-based, donation, and reward-based platforms. It is recommended that the pros and cons of each model be considered before moving forward with any specific model. Equity funding in Canada is not currently legal, but it is being considered for the future.

Kickstarter

Kickstarter opened its doors in April 2009 and experienced immediate success. During its short business lifetime, 30,000 projects have obtained funding as the result of its crowdfunding business platform. An impressive $350 million has been raised to support these projects.

Some of the positive reasons investors are attracted to Kickstarter include the fact that the funds are not committed to a particular project, unless the funding goal is met.

The project risk for the investor is dramatically reduced by this "all or nothing" investment strategy. If an entrepreneur needs $5,000 to launch a project, then Kickstarter believes that their chance for success is diminished if the goal is not met. This policy protects investors against a perceived risky investment proposition. As might be expected, the people raising money for a cause do not always view this uncertainty as a positive aspect of the Kickstarter platform.

Kickstarter charges a five percent fee, but only if the goal is met. If the goal is not met, there are no charges. While this may sound like a benefit, many entrepreneurs dislike the fact that they are not allowed to keep the money they raised when the goal is not met.

One major limitation of raising money through Kickstarter is that they only accept Amazon payments for donations. For organizations hungry for donations, it is heartbreaking when investors do not donate because it is too difficult. Many people do not have an Amazon account, and do not want to go to the trouble of establishing an account so they can make a donation.

RocketHub

RocketHub is another player to consider in the crowdfunding marketplace. Similar to Kickstarter, there is no fee to launch a project. If a campaign reaches its financial goal, a four percent fee is charged. For those that do not reach their goal, unlike Kickstarter they do get to keep the money raised, but the fee increases to eight percent. Rewards, much like in PBS fundraising campaigns, are the way investors are compensated for their good will. Depending on the donation amount, rewards vary widely.

Indiegogo

Indiegogo represents yet another crowdfunding possibility for small businesspeople to raise capital. Projects are allowed to raise funds for 120 days. Even if the goal is not met, the money raised is still given to the project, but a higher fee is charged (four percent fee is charged if the fundraising goal is met, and a nine percent fee is charged if the goal is not met). While some investors may negatively view the fact that a project is still funded even if its goals are not met, most entrepreneurs prefer this flexible approach. Entrepreneurs would likely agree that it would be terrible to fall short of a fundraising goal by a few hundred dollars and thereby lose all the money raised.

 
   
SEO - What the heck is it? Top
 

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SEO, or Search Engine Optimization, is the art and science of making your website visible in the natural search results of one or more search engines. In the early days of the Internet, when only a few businesses had websites, simply having a website was equivalent to search engine optimization. Today things are different. In some industries, there are so many companies competing for the same market that just having a website is not good enough anymore. For a website to be visible in the search engines it has to be optimized, or the business has to buy paid search listings.

The next time you perform a search using your favorite search engine, take note of the sites that show up on the first three pages of your search results. With most search engines, you will see two types of results shown for your search. One type is paid search listings. These are usually shown on the top, bottom, and left or right side of the search results page. The other type of result are "natural" or "organic" listings. These search results will appear in the center of the web page showing the results for your search and are the listings that are affected by SEO. Good SEO can help a website rise to the top of the organic search results performed for a particular inquiry. Poor SEO can hurt a website's rankings, and cause it to be difficult or impossible to find through the search engines.

There are many different factors that can affect your site's SEO, and where your website appears for a particular search. Some of the factors that can affect your website's search engine positioning include: the words and phrases used on the web pages of your site; the other sites that link to your site; the age of you website's domain name is; the titles of the different pages of your website; the titles of the images used on your website; and the type of software used to build your website. All of these are factors that a search engine uses to determine the ranking of your website, in comparison to other websites when a particular search is performed. To make things more complicated, the factors that affect SEO for each search engine are changing all the time. Effective SEO involves keeping abreast of the changes at the various search engines that one is optimizing for, and incorporating those changes into the website being optimized.

As with most good things in life, SEO comes with a price. The price is either money or time. If you have the time and the inclination, you can learn SEO yourself. There are multitudes of websites, forums, and blogs discussing SEO. However, if you don't have the time or the desire to learn SEO and it's is important to you, then you should consider hiring a specialist company. SEO fees are expensive, and can range from $250 to $5,000 a month. If you are new to SEO, and considering hiring an outside firm to optimize your website, take some time to learn a little bit about it before hiring someone to do it for you. By doing this, you will be better able to articulate what it is you want for your website.

SEO can be an expensive and time consuming undertaking, however in today's competitive landscape it is a necessity for any business wanting potential customers to find them online.

 
   
Is Outsourcing a Good Idea? Top

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The world of outsourcing is a mystery to many small business owners, but with increasing numbers of online sites offering to handle just about any creative, or accounting job you might have, it may be time to take a look at those areas where outsourcing could save you both time and money.

Outsourcing services, tasks and specialized skills can help your company grow; imagine a team of specialists available 24x7 at rates you won't believe. I'm not suggesting you replace existing employees, or even use outsourcing to hire fewer staff, but it can provide a team of people to do those things you would not otherwise be able to undertake. Recently I needed a cartoon character created but couldn't handle it in house, neither did I have the budget to hire a local artist. So, I outsourced the job to a graphic artist in Poland, via Elance.com and it cost me the princely sum of $55!

Many small businesses remain small because they lack the resources, or cash, to carry out the wide range of tasks that larger companies take for granted.

What to Outsource, and What Not to Outsource

Almost anything can be outsourced, but consider those things that take up time unnecessarily, and where you don't have the in-house staff to handle them. Areas where outsourcing can really work well is in those time-consuming jobs you can't get around to; consider outsourcing jobs such as creating PowerPoint presentations from your notes, or the formatting and graphic layout of a report. Research is another area that lends itself well to outsourcing, as is generating databases.

Here's a short list of other commonly outsourced business activities and services:

  • payroll, bookkeeping, and accounting
  • administrative duties
  • human resources
  • social media, and SEO maintenance
  • writing and editing
  • graphic design
  • IT and technology services

In this day and age if you check online you will be able to outsource just about any business activity you can't handle internally.

While outsourcing is a great way to help grow a small business it is not without risks, so who and what kind of service providers you use is very important. For example, online marketing and article writing is often outsourced to foreign service providers in India, the Philippines, and many other countries because rates and fees are considerably lower than most US and Canadian freelancers. However, these service providers can often have marked cultural differences, poor English language skills, and a lack of exposure to western marketing content and strategies. Often the results are mediocre at best. However, when culture and language are not relevant, outsourcing to overseas providers can be very cost effective.

Take a look at one of the many outsourcing marketplaces online such as eLance, oDesk, Guru and BidModo and you'll be able to browse their extensive lists of freelancers and see examples of their work.

Using freelance marketplaces can seem risky, and you may feel a bit apprehensive about hiring a complete stranger online to handle your business services. However, these marketplaces offer in-depth service provider profiles, portfolios and work samples, previous customer feedback, and often an on-site system of performance scoring. You can also hire on a trial basis in order to evaluate both a service provider's performance, as well as whether or not outsourcing will assist you in growing your business.

 
   
Advertising - A Sticky Business Top
 

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