Various members of Inc.'s staff field questions and answers from CEOs on employees, trade shows and more.
Our business is small. How can we afford top-quality accounting expertise?
Try shopping around for a "virtual accounting" relationship. A primarily electronic relationship has given AdOne Classified Network the accounting expertise it needs at a time when the company can't afford and doesn't need a full-time controller, says Brendan Burns, chief financial officer of the New York City provider of Internet classifieds.
Here's how AdOne, which had 1996 sales of $1 million, works with its accounting firm. "We receive and generate lots of invoices and other documents," Burns explains. "Weekly, we send a package to Virtual Growth, our CPA firm, which inputs the data into a QuickBooks computer file. It then transfers the information to us electronically, all properly classified. We update it ourselves internally and produce accurate, timely financials each month."
AdOne communicates with Virtual Growth mostly by phone or E-mail. Burns is satisfied with the setup. "I wouldn't hire someone internally until our accounting business grew to about 20 hours a week of work," he says. --Jill Andresky Fraser
Nine Habits of Highly Effective Salespeople
1. Spend 60% to 70% of a sales call letting the customer talk.
2. Are better than others at recognizing and responding to objections--even silent ones.
3. Are more effective than others at identifying and prioritizing customer needs.
4. Typically offer product or service recommendations after 40% or more of the time has elapsed in the call.
5. Present recommendations more in terms of customer benefits than in terms of product features.
6. Are more enthusiastic than others about attending sales-training seminars.
7. Listen to motivational tapes in their cars and read inspirational books at home.
8. Talk more frequently about what they've achieved than about what they haven't done.
9. Smile more than others do.
Source: "Benchmarking the Sales Function," a report based on a study of 100 salespeople from small, medium, and large businesses, conducted by Ron Volper Group, White Plains, N.Y., 1996.
We want more referrals. What can we do?
Ask. For a two-hour period every Tuesday, Daniel Cronin, one of the four partners of Chorus Communications, in King of Prussia, Pa., has all 70 salespeople and 8 telemarketers at the telecommunications company calling customers. The goal: to make sure that customers are happy and to ask for referrals.
Dubbed "R&R Tuesday" (standing for "Referral and Retention"), the program yields roughly four prospects referred for every 10 customers called, Cronin says. Those referrals, in turn, account for 40% of new business at the company, which had almost $7 million in 1996 revenues. "It's a lot easier to mass-manage when you have everyone calling at once," Cronin explains. "And it motivates people to see a guy two desks away having success." --Stephanie Gruner
How can we stand out at a big trade show?
Ken Hawk, CEO of $5-million 1-800-Batteries, in San Jose, Calif., did it by targeting customers off the trade-show floor. Unable to wrangle a booth at his first major computer-industry show, Hawk promoted his rechargeable-battery business by enlisting the help of a local cab company.
He asked drivers to hand out catalogs for 1-800-Batteries to any passengers who were attending the trade show. In return, Hawk and some coworkers acted as "mystery riders" and awarded a $100 bill to every cabbie who gave them a catalog. Four drivers won.
Hawk says the unconventional marketing effort generated 275 orders worth $14,794 in sales. "We spent $400 and got some great exposure that we couldn't get any other way," he says. --S. G.
My employees want another holiday. What should I do?
Employees were asking Howard Meditz, president of Marquardt & Roche/Meditz & Hackett, a marketing agency in Stamford, Conn., for an additional paid holiday. But he couldn't decide which holiday to give them. Plus, Meditz worried about closing the office on a day when some of his clients would probably be working. His solution? A "flex holiday plan." At the beginning of the year, the company, which reports billings of more than $37 million, distributed a list of 24 holidays. Employees could sign up to take any 11.
The agency's 35 full-time workers now have flexibility. They don't, for example, have to dip into vacation time for religious holidays. In addition, the office is open more days rather than fewer. That's because within departments, some employees work on a particular holiday while others don't. --Mike Hofman
Like many small businesses, Career TEAM, in Hamden, Conn., doesn't have a public-relations agency. To get the word out about the $1-million company, which places welfare recipients in jobs, CEO Christopher Kuselias requires every department to produce one press-release idea a month. "It could be a student success story or a new training method," he says. Kuselias often provides small prizes for the best ideas, such as dinner for two or movie tickets. The resulting publicity efforts have yielded at least two press mentions a month. "People want to know who our PR firm is," boasts Kuselias. --Christopher Caggiano
Off the Record
This month: What CEOs are telling Inc. about venture capitalists
"I would rather go out of business than go to venture capitalists. It's a lose-lose proposition. If you're successful, they'll put their hooks in you or take the company away from you. If you're not successful, they're not interested." --CEO, Wisconsin technology company
"We're on our third round now, and those guys have earned the title 'vulture capitalists.' They wait until you're in a position of weakness; then they try to squeeze you." --CEO, North Carolina high-tech start-up
"I talked to a number of venture capitalists before going public. But they wanted 70% of the company. Now that I'm public, I'm responsible to shareholders, but I don't have a guy on Park Avenue whose thumb I'm under." --Founder, New York City electronic-publishing company
Help! We're facing a cash-flow crisis
Providence-based Anchor Communications, a $4-million magazine publisher, projected a 1995 year-end cash shortfall of $350,000. So chief operating officer Danny Warshay enlisted the entire company's help. He first trained the staff about cash flow and then asked for ideas about improving it. The goal: to make the company cash positive by 1996. In return, Warshay promised prizes, such as a fancy all-staff lunch.
Employees responded with a variety of cash-boosting ideas. Their suggestions ranged from saving on electricity to creating a magazine-sponsored gift certificate good at many local restaurants. (Anchor sold the gift certificates to magazine readers but reimbursed the restaurants only when a certificate was redeemed. In between, "it was basically an interest-free loan," says Warshay.) The result: the company met its cash-flow goal by year's end. "It came down to the wire, but we did it," Warshay recalls. --C. C.
ADONE CLASSIFIED NETWORK, Brendan Burns, 361 Broadway, Suite 100, New York, NY 10013; 212-965-2900 96
ANCHOR COMMUNICATIONS, Danny Warshay, 95 Chestnut St., Providence, RI 02903; 401-421-2552; email@example.com 96
CHORUS COMMUNICATIONS, Daniel Cronin, 1010 W. Eighth Ave., Suite G, King of Prussia, PA 19406; 610-337-0900 96
KEN HAWK, 1-800-Batteries, 14388 Union Ave., San Jose, CA 95124; 800-228-8374 96
MARQUARDT & ROCHE/MEDITZ & HACKETT, 999 Summer St., Stamford, CT 06905; 203-327-0890 96