We should all be excited when someone walks in our door to buy from us, especially when we see they are serious about buying.  Nothing screams “I’m serious about buying” like a shopper that has done the necessary homework and is standing at the point of sale waiting to hand over some money.  In fact, it bodes well for us that they are standing at our doorstep with the competitors ad and not vice versa.  (And it’s even better when you consider that’s your competitor’s ad dollars that were spent to get a customer in your door!)

So how do we handle situations where the customer is obviously knowledgeable about the product or savy enough to know how to negotiate and shop around?!

Simple.  We have to know our product or service and we have to know our industry.

If the product is something very unique and hard to reproduce, it’s easy to distinquish your product from the competitions’ and therefore you can focus on that during your sales pitch.  Move the conversation away from price and focus on the characteristics of your product that make people want to buy it.

Ah, but what if you’re in an industry where price sells?  Let’s face it, anyone can sell something so unique and desirable that they have to go through you.  But when you’re in an industry, say car sales, where the customer can easily walk out the door and over to another store there has to be more than just a good product.

Smile.  Being friendly and engaging customers promptly when they arrive shows that you are sincere about helping them.  They will quickly push price to the back of their minds if they perceive that the service is better at your establishment.

Be interested.  Ok, so even with your bright smile they haven’t forgotten about that lower price in the ad they’re holding.  Ask questions and listen intently to what they say and how they say it.  If that price is so good, why are they coming to you?! 

During the conversation, casually repeat some of their important points…  “so you want to find something similar to this (pointing toward the customer’s ad) but in a red or maroon color?” and then once the customer acknowledges your understanding of what they want, immediately follow it up with some comments about what you can do beyond selling the same product to them.  “I think you will find we have the same product as XYZ Company but we also want you to know….(insert your selling point here!)  i.e. we have a great customer loyalty program, we have a more liberal return and exchange policy than XYZ Co., etc.”

Have a plan in place and be ready to ask the customer for a committment.  At some point you will have to ask the customer if they will accept your price and terms.  Do whatever you can to get a sale closed before the customer walks out the door.  You don’t want the customer to have second thoughts and go back to the competition.  Present your best offer and regardless whether the customer accepts the offer or walks out the door say Thank You and be sincere. 

Saying something like “I’m sorry we couldn’t be of service this time, but we hope you will give us another shot in the future” or “Thank you for bringing in that ad, we appreciate knowing what the competition is doing and we certainly value our customers.  We would be happy to honor their price and we appreciate your loyalty.“ 

Ok, some of this can sound rather canned and insincere if not expressed properly, but you have to make your best offer and no matter what the customer’s decision, thank them for coming to you before making a purchase.  Every one of us has been in that customer’s shoes and we all enjoy being told thank you.  Sometimes your politeness and sincerity can even lead to referrals or future business with the customer despite this particuar sale not being closed. 

Why are you still sitting here reading?  Go sell something!

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

Regardless whether you have a retail store or provide a professional service, recognize your customers and show appreciation for their business.  You could accomplish this any number of ways: a sale, giving out free samples, holding a seminar or luncheon, giving out coupons for future purchases, and giving or requesting referrals.

Create a profile of your customers.  Why do they come to you instead of your competitor?  Ask for feedback from your customers regarding what they like about your business and what things they wish were different.  Asking the customer for suggestions and feedback is a great way to build goodwill and show the customer that you value their input without having to spend a single dollar to earn that feeling of trust and appreciation.  Feedback cards or online feedback can also be a great monitoring technique when you are not there to supervise your employees.  

Focus on your customer this month and make March a mad month for your business!

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

Well just to briefly revisit this topic, there is nothing wrong with a free lunch when you can find it.  Regardless how effective the exposure is, if you can find it for free, there’s nothing that you can possibly lose by taking advantage of it.  I came across a way to submit your business into a directory on the Cincinnati.com website, which is the online presence of The Cincinnati Enquirer newspaper.  You simply fill out this page with information about your business, namely what it is that you do, how to contact you, and then submit it for approval.  It costs you absolutely nothing, except your time… and if you don’t have enough time to fill out a one page submission for free advertising then your business is obviously doing well enough that you don’t need to advertise.  Or you need to manage your time better; we can do a separate blog series on time management and delegating work loads.

Another way to get free exposure for your business is to send (usually via fax) press releases to newspapers and local media outlets like radio stations.  This form of free press is best used when you have a specific item or event to promote, or it’s a special occasion for your business (like your 10th year in business, landing a big contract or order, expanding your facilities or hiring more people, moving locations, under new management, and so on).  If the message is good, and you can incorporate a few extra details about your business - ESPECIALLY if you can use the press release to draw people into your store or onto your website, then it will most likely have a positive return.  The most it will cost you is the time to create the letter that you will fax.

I welcome any additional ideas on how to promote your business for free and hope to hear some great success stories as well.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

While many businesses have strategic goals, long-term plans, mission statements, and exit strategies perhaps it’s also time that we started making new year’s resolutions for our businesses.  Most business owners make a budget for the next year.  But why not also use this time to critically evaluate the work-flow process and make any necessary changes that help improve efficiency, customer service, and best of all - profitability.

Think of something in your own business that did not go as smoothly as you hoped in 2007.  Decide what you will do differently in 2008 to improve that situation and achieve the desired outcome.  Then jot down a quick list of reminders and things to do to make sure that happens.

If the problem is inherent in your way of doing business, perhaps it’s time to review the overall process.  One quick and easy way to do this is to create or update an existing Gantt chart.  You can make these charts as elaborate or simple as your individual needs require, for instance Microsoft Project is a nice piece of software but I’ve found that you can open an empty Microsoft Excel or other brand of spreadsheet and label and shade the boxes to create the same basic chart once printed.

If you personally are the roadblock to your own company’s success, consider finding a coach or a mentor.  This doesn’t have to be something formal where you hire one (although you certainly can), it can be a trusted friend, a former industry professional that is now retired, and even some colleges offer coaching services to alumni.

Regardless whether you have a short list of things that you keep in your pocket or you decide to rethink your mission statement and supporting goals, these new year’s resolutions are not for you, they’re for your business. 

All the best to you and your business ventures in the coming year!

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

• The phrase Do you want fries with that? is actually a great example of two things: suggestive selling, or “up-selling”, and knowing your customer.  In this case, the customer has approached the company and said I would like to buy a burger.  The company knows its customers like fries with their burgers. 
  The suggestion that the customer try some fries will sometimes be met with a positive response and sometimes a negative response.  Either way, the customer is already at the point of sale so it costs the company no additional money to market the fries to this customer.  Amazon is a great example of a company that knows its customers and practices this suggestive selling.
• Responding to customer requests quickly will only be met with disappointment if it sacrifices quality and accuracy.  I have yet to see someone unhappy when his or her order is delivered quickly and correctly in a fast food drive through.  I have, however, seen many people sigh, cuss, frown and so forth when they open the bag and discover the order is incorrect or incomplete.  Regardless what industry you are in, responding to customer requests quickly and accurately will help build goodwill - that intangible quality that helps give you the edge over a competitor with a similar product.

There are many more examples of things we should do and things we should NOT do but I wanted to focus on the two items listed above.  Feel free to post your own thoughts and experiences via the comments section of this blog.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.  He also had the joy of working in a Dairy Queen restaurant when he was 16.

I recently got a call from a gentleman that is selling ad space on the back or sides of trivia cards that are distributed to bars and restaurants.  The idea is that people will be waiting for their food, or sitting at the bar drinking, and will look at these trivia cards or use them to make conversation with their friends and those around them.  Ok, simple enough. 

It turns out that of the 5 locations that he offered me, I was only even remotely interested in getting some advertising in one of them.  Why you ask?  Well, four of the establishments really didn’t attract young professionals, nor were they in growing areas.  Then there was the “traffic count” that he was touting.  “XYZ Restaurant has approximately 2,000 people visit it each month.”  I paused for a moment and replied, “yes, but the same 500 people visit that restaurant each week, it’s a local hole-in-the-wall.”  It seemed like he was trying to sell me too much exposure (number of restaurants) that wasn’t enough exposure (actual or unique traffic count).

He was taken back.  He never recovered from that statement.  He never brought up XYZ in the conversation again; rather, he focused on the other restaurants.  But he knew I wasn’t going to spend advertising dollars chasing after so few people in the customer base.  Besides, the more modern upscale restaurants have computerized trivia games at the bar instead of plastic or laminated cards.  So he was pushing yesterday’s technology and lackluster locations.

Here’s what I learned from this encounter that I try to think about anytime I am asked to open the purse strings and spend money on advertising:

• Is it geared toward the customer base that I am wanting to target?
• Does the advertising give me a decent amount of exposure for the price?
• How much control will I have over the ad and how my name is being used?
• How will I be able to measure the effectiveness of the ad? (I have found this one to be especially important in online advertising).

These kind of questions fit in nicely to having an overall marketing plan in place.  Think of your own business and some unique questions you would need to use as a screening process or criteria before committing advertising dollars.  You can expand on some questions more than others depending on your particular business needs.  In the end, it’s important that you have a plan in place and your budget reflects that plan and the goals that you have for your business.  I welcome your feedback and hearing what you do to make advertising decisions in your own business.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

The NAICS code for a given business will be six digits long.  For instance, I am engaged in the sale of real estate.  But if you type in Real Estate into the search box on the NAICS website, you get numerous results.  There is “Lessor of Nonresidential Buildings”, code 531120.  Since I am a Realtor, I am better classified under “Offices of Real Estate Agents and Brokers”, code 531210.  This is a good time to point out that any one business could fall into multiple class codes.  If I was a Realtor that also handled the leasing of non-residential buildings, both codes might apply.  You certainly wouldn’t be able to put General Electric into one classification code; rather, you would have to determine a number of codes that apply to its divisions. 

One more important thing to note: the classifications can be very broad or very narrow.  The more zeros there are at the end of a classification code, the broader the label.  For instance, code 445000 is Food & Beverage Stores.  Code 445100 is Grocery Stores.  Code 445120 is Convenience Stores.  This helps identify the industry and any particular niches within the industry.

So where am I going with all of this?  If you know the classification that applies to your own business, your products and services, and your industry in general, then you can identify a number of things.  You can identify who your greatest threats are with respect to competition.  Then there are potential new customers if you’re a Business-to-Business (B2B) entity.  You can even see whom your suppliers’ competitors are in your supply chain to help you find the best prices for the things you need to run your business. 

So you’re saying to yourself: so I have a few numbers scribbled on a sheet of paper.  What do I do with these things?!  Well, aside from scouring the Internet and researching individual companies, my best advice is to walk into any public library and head to the reference section.  Ask any librarian where you can look up companies by NAICS codes and they should have a directory to assist you.  You may have to specify the full name of the NAICS when asking for its directory. 

Also, as a brief side note, the NAICS replaced the US Standard Industrial Classification system (known as the SIC).  Since the NAICS is relatively newer, you will see references to both codes.  Just know they are essentially serving the same purpose, to identify industries and classes of businesses.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

Be direct.  Don’t hint around at what you want or what you have to offer.  Make express affirmative statements that show you are standing firm in your position.  Statements that start with “well,…” or “what I was thinking…” and so forth will leave the other party with the impression that you are doubting the strength of your position. 

Instead, use phrases that emphasize your belief in your position; for example: “Here is what I am prepared to offer.” or “This is what I am capable of doing.”  Following those statements give your proposition, then stop and listen.  Make eye contact and examine the other party’s reaction.  Being straightforward also prevents you from giving away more information than the other side needs to know, which leads into our next point.

Don’t tell the other side more than they ask for or more than they need to know.  If they ask something that could weaken your position, just work around the question with something like, “that’s not what’s important here” or “let’s try to stay on task and see if we can reach an agreement.” 

In the above two strategies some may think you risk coming across as being too rigid.  Certainly you can take anything to an extreme, such as combining the above direct authoritative statements with the use of a harsh tone, gestures (such as aggressively pointing or pounding your fist on the table), or by just being rude (interrupting someone is one of the fastest ways to send a negotiation process into a tailspin). 

Being direct while still being professional and calm is actually more respectful as you spend more time listening and only stating the relevant facts to your side.  You essentially take the emotions out of the deal.  The emotions are what usually kill a deal or cause someone to give away too much and “lose the deal.”  Remember that saying from my friend, the car salesman, “a good deal is a state of mind.”  If you lose your cool and end up paying more for something than you originally wanted, this could cause you to feel buyer’s remorse or that you were cheated.

Don’t respond too quickly to the other side’s proposal.  Shooting from the hip or responding off the cuff makes you look anxious and likely to forget something you wanted to add or even confuse you about where the offer currently stands relative to where you want to be.  The easiest way to slow things down is to write them down.  As the other person is talking, jot down some of their points, especially the points that you wish to challenge. 

If the other party is handing you something in writing while you verbally discuss the deal, go through the document and circle things or write notes in the margin.  As a courtesy ask the other party if you can make notes on the document.  If the document was intended to be the final draft of your deal you wouldn’t want your personal notes about the “airhead” sitting across from you to show up in the margins!

Don’t go backwards in the negotiation.  Once a particular part of the deal is done, move on and focus on the remaining details.  Don’t let the other party try to make changes to the portion of the deal that’s already been done.  If the other side tries to change something that’s already been agreed upon, reply back with “we already agreed on x number of units, we now need to determine when they will be delivered and who is responsible for insuring the shipment.”  

Reminding the other party of the remaining concerns helps keep the negotiations moving forward rather than continually going over the same parts that were already discussed.  These kinds of statements should be reserved for when the other party is trying to go back and change things.  You shouldn’t continually say what is left for negotiation as you make progress.  No one likes a narrator during negotiations.  Rather, this type of response is exclusively used when the other party is backtracking.

Stick to your walk away price and terms.  Car salespeople are excellent at getting people to come up higher than where they want to be.  If someone says $19,000 is the most they want to pay for a car you can almost bet the salesman is trying for $19,500.  Usually they will do something with the financing like saying, well it’s only an extra $26 per month on the payments and then describe all the nice features on the car again. 

The bottom line is that your walk away price should be just that.  John F. Kennedy once said, “We cannot negotiate with those who say ‘What’s mine is mine and what’s yours is negotiable.’”  If the other party won’t come to terms with you and you’re at the walk away price, it’s time to walk away.

Now it’s time to hear from you.  Regardless whether your negotiation experience was buying a car or a multi million-dollar acquisition, we would like to hear your thoughts on what you do during the actual negotiation.  Feel free to leave comments and feedback to this article as you see fit.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

Prior to going into a negotiation meeting each side knows that they have a starting point and a walk away price.  We don’t usually say, “ok, I’m going in to this car dealership and I am going to buy that new SUV for $19,000.”  Neither side knows the final sale price or terms going into the negotiation.  We have that $19,000 as our starting price in our mind, but we know that to actually purchase the new SUV we will probably have to come up a little higher.  We start out low because we know the other party will never come back with less than where we start. 

Likewise if you’re selling the SUV you might think to yourself, “I would really like to get $28,000 for this vehicle, but if I had to I could let it go for $24,000.” 

Having a starting point and a walk away price helps us keep the negotiation in a framework that we can use to create a deal that is satisfactory to us.  This leads us into some principles of negotiation.

Let’s talk more about what to do prior to going to the actual negotiation.

Do your homework.  Identify the strengths in your position.  In our above example we said we had a beginning price in mind.  You should know why your starting price is what it is.  Have some reasons why you think the other side should concede on price or other terms.  Are there acceptable substitutes for their product in the market?  Is there a way to reach your ultimate goal without the other party’s product or service?  If you are the seller think just the opposite: what is it that brought them to purchase your product or service versus your competitor?

Rank your needs from those that you absolutely cannot concede all the way down to those that you are the most willing and able to concede.  This isn’t to say the least important things are those that you should start off with, nor should you just give them away.  But if you have to start bending a little from your position to get the other side to concede, it’s best if you have an idea of what you can do without and what kills the deal for you.

Take your position out for a practice run before the actual negotiation.  You could have a business partner, spouse, or friend play devil’s advocate with you.  Have your friend perform the role of the other party and see how he or she responds to your offer.  You will be more likely to see any flaws in your argument before the person helping you role-play will.  Use their reactions to gauge where you need to make changes in your argument. 

Think of other things you can bring to the table that the other party might not anticipate.  In our car example, as the buyer you could offer to take business cards, key chains, magnets, etc. to your friends and family.  Businesses that work on referrals are more accepting of incorporating future business into their current negotiations.  If you are involved in a group or organization and provide the other party with the ability to reach a larger audience by virtue of your sale, don’t hesitate to mention that when you present your offer.  Use your social influence on groups that you belong to as a way to negotiate a better deal for yourself.

I would love to hear from fellow entrepreneurs and especially people with sales experience about how they prepared for negotiations beforehand.  You can leave comments on this post or simply use the Contact form on this website to do so. 

My next post will be regarding the actual negotiation meeting, so if you have comments or experiences you wish to share about the actual negotiation taking place, please save those and post them in the next blog entry!

 Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.

First let’s go over the application for employment:

Aside from the most basic information such as name and contact information (phone and address), it is imperative that the application has the following additions:

Employment at will statement.  Unless you work in a business that has union labor you must disclose to the applicant that the company may let people go if it needs to and do so without advance notice.  This statement is a two way street though, the employee can leave if and when he or she chooses as well.  Applications for unionized positions will require an arbitration agreement on a separate document from the application.

Equal Employment Opportunity statement.  Unless you’ve been living under a rock for the past 50 years, this should not be a surprise.  You cannot discriminate based on any of the protected classes: age, disability, race, gender, national origin, ancestry, and religion.  This is a great opportunity to remind you that you should have an attorney review any documents used in the pre-hire stage of your business (not just the application, but any advertising recruitment materials, any supplemental forms, etc.).

If you conduct background checks, and it is wise to do so, have a separate form that the applicant must sign giving permission to complete the background check.  The application itself can have a statement that the applicant is providing information that is truthful and accurate to the best of their knowledge. 

Disclose if you require medical examinations or drug screening prior to employment.  Make sure you state that employment is conditional and contingent upon the results of these tests.

Avoid these pitfalls:

DO NOT ask the applicant to submit a photo with the application or resume, not even a copy of a driver’s license.  I think the ONLY time this could even remotely be considered appropriate is if you are the casting director for a tv or Broadway show.  A photo opens you up to allegations of virtually all of the protected classes in the Equal Employment law.

DO NOT ask the applicant to list graduation dates from schools, colleges, and so forth.  Once again, this could be construed as a roundabout way of identifying someone’s age. 

DO NOT ask for a copy of the applicant’s driver’s license, birth certificate, green card, passport, or military ID.  For something like a driver’s license, which contains a photo as well as the person’s gender and age, this hints at several of the protected classes.  In addition to age, birth certificates can be construed as a way to determine national origin or ancestry.

DO NOT request the applicant to provide or list membership in organizations or affiliation with any affinity or charitable group.  These non work-related “community involvement” categories on applications only serve as a way to learn about someone’s political, religious, or ethnic affiliations and values.  You don’t want a question on the application to be construed as hinting at protected classes.  Even stay away from asking about involvement in trade assocations and job-related groups.  As a licensed insurance agent, this reminds me of the Women in Insurance group.  Yes, it’s a job-related group, but it specifically identifies gender.  Avoid asking about organizations and affiliations in general and you won’t have to worry about someone listing a trade group that also identifies a protected class.

DO NOT ask about marital status or sexual orientation.  No need for explanation there I hope.  While these are not protected classes, how much do you think a sexual harassment lawsuit will cost you?

DO NOT ask about medical conditions or health problems, whether mental or physical.  If the person shows up in a wheel chair or wearing sunglasses and carrying a white cane to turn in the application, don’t even think of making a note about it and certainly don’t ask a thing about it. 

DO NOT maintain multiple versions of the application.  You will not want to have to explain why you give someone one version of an application but give someone else another.

Finally, consider purchasing the following types of insurance for your business:

Employment Practices Liability Insurance.  This will protect you from claims of wrongful termination, discrimination based on a protected class, and so forth.  Each insurance company can have its own coverage form so ask your insurance agent what is covered and what is not.  Generally, you are not covered for negligent acts on your part as this insurance is not a license to sin.

Crime coverage.  Namely, Employee Dishonesty.  This is to cover the obvious employee embezzlement as stated in the title of the coverage.  A similar coverage that often accompanies this coverage or is offered in addition to it, is called ERISA coverage.  ERISA coverage is protection you may need when you administer a retirement plan, i.e. 401(k) for your employees.  This coverage guards against embezzlement or misuse of the plan’s funds.With the proper risk transfer techniques in place during the pre-hire and employment stages, you can make sure your employees contribute more to your organization as assets than liabilities.

NOTICE:  I am not an Attorney.  Nothing in the above article should be perceived or construed as legal advice or instruction.  It is important and HIGHLY RECOMMENDED that you seek legal counsel and consult with a licensed, practicing attorney to discuss any concerns and to review your business and human resource practices as well as your application and any other documents.

Thomas Goodwin is an Ohio licensed real estate agent (Realtor) and insurance agent.  He is the Founder and CEO of Northern Pine Properties, Inc., a real estate investment, development, and management company in Cincinnati, Ohio.