It happens often: Your computer system goes down, and your business comes to a halt. You have to get it fixed, pronto. You call the computer hardware supplier. He checks it out and tells you the computer is fine — it’s a software problem. You get hold of the guy who sold you your sophisticated software package, and he says its a hardware problem.
What to do? Well, somebody has to get you up and running, and it’s a frustrating time for you. The answer: Don’t put yourself in the way of this problem, in the first place. Have a single local supplier for hardware and software. No matter where the problem is, it’s their job to fix it.
The obvious answer: Have a good list and a good mail package. Direct response mail, as it’s usually played, is a numbers game, in which just a small response percentage is often a success — send the mailing, count the responses, then add up the sales from those responses. Direct mailers know that many on their list don’t bother opening or reading what’s in the mailing. But that’s acceptable, because some do, and that’s often enough. What a mailer doesn’t know is how many more sales would have been made if only everybody read the message.
You can’t force people to pay attention to your direct mail. But what you can do is follow up your mailing with a phone call. In my experience, direct mail with phone call follow-up produces the most qualified leads and the most sales from a given list. “Did you receive the mailing I sent you?” gets a dialog started, whether the prospect has read the mailing or not. Quickly recap the major sales points, or offer to re-send the mailing piece. Engage the prospect, and get him/her on track for a sale.
This is a labor-intensive strategy. It involves many time-consuming calls. It’s not practical for use with a mailing list numbering tens of thousands of names. But it can be very productive if you have a small, well-targeted list. Stagger the mailings so you can stagger your calls; don’t let too much time elapse between the mail and the call.
You’ll get the leads generated by the mailing alone, plus the additional leads generated by your phone calls.
If your business requires significant operating capital — for inventory, rent, labor, and such — don’t take it out of the business to pay your personal expenses. Understand that operating money isn’t yours to spend; it’s a vital part of your business. Also, be sure not to spend money you collect from your customers for taxes. That doesn’t belong to you, either; it belongs to the government. You didn’t earn it. You just collected it.
I recall with some dismay a client of my ad agency who appeared to be doing quite well. What I — and others — didn’t realize was that he was collecting hefty state tax payments from his customers, then not reporting them, and not turning the money over to the state. The state tax authority soon caught up with him, and he narrowly escaped going to prison. As the bible says, “Give unto Caesar what is Caesar’s.” Don’t fool with tax people. They’ll destroy you.
Keep your own personal finances in order. Your money problems are almost certain to impact your business. If you have consumer debt, do your best to pay it off — or at least pay it down — before your startup. Take the money out of your savings, if you have to.