A recent article in the Wall Street Journal by Angus Loten, titled, “For Small Firms, the Check is Not in the Mail” really struck home with us here at Cazbah.  Angus’ article poignantly describes one of the potential downsides of being a supplier or vendor to big companies; the fact that you may not get paid or that you certainly won’t get paid on time.

“About 14% of nearly 5,000 entrepreneurs cited late payments — or customers that didn’t pay at all — as their biggest challenge in 2010, up from just 2% in 2008, according to a study released Wednesday by the Ewing Marion Kauffman Foundation of Kansas City, Mo.”

We hear the horror stories from our small business customers all the time about how they have been abused by their largest customers and their late payment practices. All small businesses have felt the burden of financial instability at the expense of their larger corporate customers at some point. This is a serious issue for all small businesses who depend on their receivables for cash-flow, which is most of them.

According to the National Federation of Independent Business, “in 2011, small businesses waited up to 46 days on average to get paid, six days longer than in 2010 and 10 days longer than 2006.”  This resonates with many of our customers, who are often battling to get paid. Bear in mind that these numbers represent the average, which means that there are late payment situations reflected in these numbers that are much worse.

Charles Broersma, CEO of Cazbah, relates his experience with a large corporation:

“Some big businesses have perfected, and frankly institutionalized, the process of holding out on and late paying their small business vendors.

I recall being invited to attend a Vendor Summit, which was an annual affair put on by a local big business here in Rochester (we’ll refer to them as ‘Company X’), some years ago. I felt privileged to have been invited to such a prestigious occasion. That is, until I got there and realized what it was.

The event kicked off with some fanfare about the bright future and new products that were being developed and the goals of the company and how we all had to pull together as a team, yada, yada. Then, the current CEO of the company, who was a mere Vice President of something or other at the time, got up and basically told a packed auditorium that they (the vendors) were going to lower their prices to ‘Company X’ by 10%, across the board, and that ‘Company X’ was going to extend their payment terms on all invoices to the vendors.

I was in shock. I had never heard of such a thing. I was sitting next to the president of a small manufacturing company that had been serving ‘Company X’ for years. His comment to me was that this was typical behavior. He clearly didn’t like it but, he wasn’t surprised in the least. He said, ‘what are we going to do? If we want the business, you have to put up with this unfair and unethical behavior.’”

It’s important to note that “Company X’ is a profitable, multi-billion dollar annual revenue company. It hardly seems like the type of behavior befitting such a company, to walk all over their small business suppliers.  But, as evidenced here and elsewhere, it happens all the time and is an accepted business practice.

It’s hard enough for any small business to succeed, let alone do so without getting paid! One would assume big businesses would be the most reliable, accepting a corporate responsibility to pay their bills on time. Clearly, this is not the case: “on average, big businesses – those with 1,000 or more employees – paid their bills more than a week past the due date on invoices.” This is the start of a vicious cycle, with small businesses unable to pay their bills on time, and so it goes…

‪We’d like to hear from you about your challenges as a small business.

‪Have you been stung by the big company late payment bug? Are your customers “holding-out” on you, and if so, for how long?

There’s nothing better than a fired-up client … a client eager to spend resources and energy on doing smart things in a smart way … a client ready for results and willing to do what it takes to get them.

And there’s nothing worse than having to tell that client to holster it back up because they aren’t ready to pull the trigger.

That is sometimes the situation we find ourselves in when our small business clients are interested in implementing social media strategies before they have made sure that the location they are driving traffic to – usually their Web site – is prepared to handle the traffic.

When it comes to marketing their own brand, many small- and mid-sized businesses are working with limited resources.  So a decision to increase focus in one area often inadvertently becomes a decision to decrease attention in another.

Embarking on a social media strategy is a major undertaking for any company, an effort that often manages to soak up a lot of internal resources.  This can mean that the more mundane efforts it takes to update the company Web site can often go ignored, leaving the place you are trying to drive more traffic to looking something less than its best. Why is this a problem?  Because social media efforts are just a means to an end, with your final goal being to convert traffic into sales.

It’s important that the first step of your social media strategy be taking a look at your Web site and making sure it is an effective end-destination for every tweet, blog post and shared video.

• Are there clear “calls to action” throughout your Web site?
• Are your products and service pages current, accurate and complete?
• If you are targeting a specific audience with specific services/products needs in your social media efforts, are those services/products easily found?
• Are your contact pages updated and complete?  Is it easy for customers to continue the dialog that you started with a social media vehicle?
• Is your Web site content of interest to your social media audiences?

Pages that need simple corrections should be taken care of right away.  Any section that needs more extensive effort should be avoided as landing pages for social media traffic.  Once you are comfortable that your Web site is ready and able to do handle the new traffic, your company can feel comfortable in taking its first shot at social media success.

Lately I have been spending a considerable amount of time visiting with our customers located all over the U.S. The purpose in my recent “road warrior” lifestyle is twofold: First, I’ve made a commitment to personally meet with our customers in 2010, and second, I’m presenting many of them with our additional value added services.

The acceptance rate of our community management offering has been unprecedented. As I mentioned in a previous post, this service has to do with our customers’ adoption of social media. Cazbah provides them with the technology, work processes, and dedicated service and support to increase their inbound marketing opportunities. It also establishes them as the center-of-influence within their communities, hence the name.

On a recent visit with one of our clients while presenting a community management proposal, we got into a discussion about the viability of social media within their particular industry. Our client admitted he wasn’t too familiar with social media networks and expressed his concerns about how social media was going to help him sell his products (a very reasonable and accurate concern). While I did take the opportunity to highlight some of the benefits of social media for his business, it became clear to me that we need to  educate all of our clients regarding new media techniques that can improve their businesses.

With a wry smile, the client  asked, “I wonder what Warren Buffet is doing in social media?” He stopped me in my tracks. I thought, “what a great question.” Even though he was half joking, he struck on something profound. Clearly, if you are considering a change, you look to the leaders to gain insight into your decision making process. Who better than Warren Buffet, one of the savviest business men in the world.

Social media plays a vital role in viral marketing and enables further brand awareness. This is accomplished by establishing word-of-mouth communication between community members regarding relevant information which induces purchasing by driving traffic to a company’s Web site. Additionally, social media removes the barriers that may normally exist between a company and its customers, giving them the opportunity to communicate openly and virtually instantaneously.

Warren Buffet’s holding company, Berkshire Hathaway now owns a diverse range of businesses including railroads, candy production, retail, home furnishings, encyclopedias, vacuum cleaners, jewelry sales, newspaper publishing, manufacture and distribution of uniforms, manufacture, import and distribution of footwear; as well as several regional electric and gas utilities.

Good Content Law #2 – Current

Your information may very well be what your prospects and customers are looking for. However, if it’s outdated it’s as good as yesterday’s news! No one wants to read a newspaper from several days or weeks ago. In their quest for information, your prospects are looking for cutting edge data that will answer their questions and solve their problems. This certainly puts the burden of responsibility squarely on your shoulders.

This point speaks to a basic misconception that exists with many small business people about the Internet. The misconception is that somehow Internet Marketing requires less effort than traditional marketing. To this I respond with what I tell everyone who thinks there is some get-rich-quick formula that they haven’t yet discovered online: “You get back what you put out!” This is a simple truth that applies to everything in life including Internet Marketing. Another way to put this is “You get what you pay for.”

Fear not! Information is what the Internet is all about. There is literally an unlimited supply of information available online that you can provide to your interested eyeballs (prospects and customers). This will probably require you to change your view about using OPI — Other Peoples Information, and generally force you to take a less parochial view of the manner in which you service your customers’ need for information.

The upshot of this part of the discussion is that in gaining access to “good” content online, you will be presented with the opportunity to think more broadly about your business model. Actually, forced to think more broadly accurately describes the situation that you face. Again I say, fear not! This is opportunity knocking! Openly sharing information is one of the foundational principles that Social Media is based on.

I wrote the following article over 4 years ago and it was published in Business Strategies Magazine. It came up recently in a search result and I re-read it and pondered how, the more things change the more they stay the same. It really speaks to what the “Social Medium” is all about. Read and enjoy!

Like most great principles, integrity gets a lot of lip-service, but it’s seldom a true way of life, especially on the Internet. We have tuned ourselves to distrust what we read and see because frankly, so much of it is spin or an all-out lie. If it seems too good to be true, it probably is… When we hear the word integrity it often congers up an image of a stern and sober school master whose Quaker or Puritan upbringing shows through his innate inability to smile, joke or be happy. But this isn’t what I’m talking about when I say integrity. I am talking about that character quality that doesn’t cut corners or shade the truth, no matter what.

Integrity is the key to success in everything that we do. Integrity is honesty and truth, period. Shakespeare captured the essence of this in Hamlet, when he wrote; “And this above all, to thine own self be true. And it must follow as the night the day, thou canst not then be false to any man.” If we are honest with ourselves we can’t be dishonest with anyone. If our motto is integrity, we always have what we need. We sleep soundly knowing that we don’t have to worry about what we have said or done.