tv Your Business MSNBC May 23, 2015 2:30am-3:01am PDT
small businesses use data to become more efficient and more profitable, and how the national small business persons of the year helped revitalize their missouri town. news and information to help your small business make lots of money coming up next on "your business." small businesses are revitalizing the economy and american express open is here to help. that's why we are proud to present "your business" on msnbc.
hi everyone. i'm j.j. ramburg, and welcome to "your business." the show dedicated to helping your small business grow. how often do you think about data in relation to your business? every single one of us who runs a company is collecting data and i suspect that many of you throw out this data or never look at it. but hiding in those numbers are great strategies to help your company thrive. to give you an illustration of this we went to visit an owner of a lunch shop who showed us how her data helped her increase her cash flow and decrease her supply costs. >> next customer! >> take a close look at this
turkey and cheese on a roll. if you're one of these customers at village cheese shop in palo alto california that sandwich looks like lunch. but if you're lindsay hiken, the owner here that sandwich looks like data, raw data. >> these are their bread choices, these are their spread choices, meat, cheese, toppings. if they wanted any deli side. >> at the 50 year deli shop which lins say has owned and operated since 2007 she turns everything into a number. >> we've been open 19 minutes, we've made 266 bucks. some of that is catering. who's visiting my business. a big slice is the 25 to 40-year-old demographic. that's the biggest demographic. >> oh, yeah. lots of data in that sandwich. >> big data expert alan bondi is at vancouver based open tech. >> how much did that sandwich cost, who bought it? >> he says even small business
owners can learn a lot from their data if they just ask the right questions. >> how many times have they bought it? where did the meat come from? how much did the bread cost? >> and those are exactly the kind of questions lindsay asks herself every day. >> in the past 30 days i've paid 131 bills for $50,523. >> the problem is tracking those numbers is harder than you think. >> something goes up by 7 cents a pound you don't necessarily notice on the first invoice or whatever but over time you start seeing a difference in the money that you're making. it's eating eroding the margin. >> if the costs rise faster than the prices lindsay says even popular shops like hers can go broke very rapidly no matter what industry they're in. >> i can't raise the cost of my sandwich up and down based on what the cost of tomatoes are or cheese. >> like any other high volume business she says her survival month after month depends on monitoring those food costs
because the profit margins are so small. >> i'm somewhere between 86,000 and 110,000 in sales, which is a fair amount considering, you know, our average ticket price is about 9 bucks. you know so doing a million bucks 9 bucks at a time is a lot of turnover. >> the first difficulty with tracking those costs is that suppliers don't always give notice when prices change. the second obstacle to tracking food supply prices is the paper trail. the receipts listing changes come in willy-nilly on scraps of paper left behind by the delivery man. no digital records at all. >> you get paper every day from vendors. there's so much paper that it sort of becomes pointless because they couldn't really find anything. we might as well have just thrown it out to be honest. >> in fact that's exactly what lindsay does she just throws them all out, but not before she's carefully scanned each one into her quick books account. >> these are my food costs right
here. >> that daily receipt data is then e-mailed into her bill.com account for payment and also sent to a spreadsheet showing the rate she's paying. vendor by vendor day by day, month by month. >> there's frito lay. showing all of the bhils paid to frito lay. >> this allows her to track prices. >> either bringing them down with your vendors or adjusting your prices or dropping something off the menu. those kinds of things. >> by using the data this way to revise vendor orders lindsay's retail business is what alan bond calls data driven. >> this is the difference between a business that generates data which all businesses do and a business that strives to become data driven where the data becomes part of the decision making. >> lindsay says other shop keepers who simply collect their receipts in a drawer and wait until their bookkeepers do the math no matter what kind of business they're in are getting
their information too late. >> they may have overpaid six months. there's money left on the table when you wait until you arbitrarily notice. >> food costs are not the only numbers she monitors. lindsay also uses breadcrumb software to track the cash in the cash register. >> we assigned a single cashier to a register. if there's a consistent she works every wednesday, every wednesday the cash register is short you can tell. >> alan says this kind of access to data allows owners to make decisions and change plans quickly and effectively. >> the key with both big data and small data is getting that rapid feedback and then thinking about the actions that we take. >> but data alone is not enough. when this vendor suggested lindsay could save 17 cents a pound on precooked roast beef to replace her store cooked supply she jumped on it and made a big mistake. the customers could tell that it was commercially cooked and they
didn't like it at all. >> the feedback was like you've ruined my life and i just realized it's not worth losing that business. that's a case where i could bring those food costs down but the tradeoff isn't worth it so we went back to the recipe. >> that's where the judgment comes in. some numbers matter more than others and every business owner must decide what to do with the data once they get it. >> i can't say i've ever had a single day of being bored here since i bought the business because there's always something to do. never the same. twitter can be a great platform for your business but only if you use it correctly. according to the company, there are more than 288 million monthly active users. here now are five ways you can create an amazing twitter profile to draw in some of those people courtesy of inc.com. >> one, view it like a business
card. keep your profile professional, short, and sweet. focus on the information you need to convey. two, imagine your audience. know exactly who it is that you want to reach on twitter and then kater to that group. three, draft your mini resume. highlight your greatest accomplishments, but remember there's a word limit. four use key words and hashtags. this will increase the number of people who find you when they search on twitter. and, five add links. take advantage of this option to gain more credibility and followers. a tight knit missouri family was named the national small business persons of the year during national small business week. we actually met this family last year, and i was personally so inspired by their story of founding the missouri star quilt company. not only have they built an incredibly small business but along the way they completely revitalized the community. it started with a quilting
machine and viral video which made the company's matriarch a viral star. welcome to hamilton missouri population, 1800. until now hamilton has best been known for being the birth place of jcpenney but today, this kri which is an hour away from kansas city is known for something different. quilting. it's been dubbed the disneyland of quilting. people have come from all over the world from as far away as australia, but once they get here, turns out there's not much else for them to do so missouri star has broadened their vision. now they're working with local partners to turn this sleepy town into a true destination. how many of these buildings do you own? >> right downtown hamilton we have 12. >> you're really -- you're taking over this town? >> we're taking advantage of people not using them and
letting them be run down and fall apart and putting together something new and exciting. >> some of them, i see, you have the sewing retreat for quilters. >> yes. >> you have sew seasonal over there. >> well, we're focused on quilting. we want to have most quilt shops than any town in the world. >> what do you think the missouri quilt shop is doing? >> they've brought in employment. i'm sure they're the largest employer in the city and in all of the county. they've came in and improved a lot of our buildings that were in disrepair, maybe dilapidated and going to fall down. it's been a really good situation for the city of hamilton. >> and the city of hamilton has been really good for the doane family. 20 years ago ron and jenny doane were barely making ends meet living in california when they decided to pack up their large family and head to missouri with the hope of finding a slower pace of life and lower cost 6 living. with a fresh start jenny stayed home raised her seven children
and suddenly found herself with an empty nest. she took a class in quilting fell in love with the craft and found she was a natural. inventing short cuts that allowed her to block, stitch, patch far faster than everyone in their class. >> i had made 12 of them by the time i was done. i was so addicted. >> with the economy shaky in 2008 and ron near retirement the doane children were concerned that the parents had little money for their golden years. since jenny was spending so much time on her new hobby, the kids thought purchasing a professional quilting machine might be a good investment for the future. helping them start a little business that might bring in a small income for their parents. >> we got a building for $24,000 and a quilt machine for $40,000. the quilt machine cost more than the building. that was the catalyst that got us all going. >> from those humble beginnings the missouri star quilt company was born. alan, his sister sarah and
another partner boot strapped a quilting website based on a daily view. when the website gained some traction they realized jenny's larger than life personality was perfect for youtube. >> the competition begins now! i know this looks a little crazy, but i've done crazy things before. >> now it turns out jenny is the real star at the missouri star quilt company. >> all i was hoping for was, here's jenny! >> as jenny's notoriety on youtube grew, so did the business. she has a devoted following of 150,000 subscribers and her folks bring videos have been watched 28 million times. the business was humming along nicely when something totally unexpected started happening. >> last time we weren't here jenny wasn't here. i was disappointed. today i got to talk to her. >> people started making the
pilgrim miningage to hamilton to see jenny. the family saw the opportunity to grow their business and the town. >> we can't all be quilting. we know we have to build an ecosystem that supports everyone. we have a couple of buildings that will be refine fished into retail space or space people can come in and rent and run their business and that's really exciting to me because that means everybody gets a chance to succeed. >> would it be possible for you to open the restaurant without the missouri star company? >> no. >> what did they do for you? >> they provided the building that we leased for them and financed us to get it running. >> i'm so proud of my children. they were at a town meeting and they said this is going to be a one dimensional town. alan said isn't it better than no dimensional? we're doing something. i'm telling ya i'm just as tickled as i can be to see it happening. i think most everybody is, too.
if you're doing things right, you've spent a lot of time thinking about your company's brand and then every single thing you do helps reinforce that message, but your brand doesn't have to be and, look, maybe it shouldn't be set in stone for the entire life of your company. our next guest will highlight several telltale signs that soon it could be time to rebrand. dorie clark is author of the new book, "how to find your breakthrough idea and build a following around it." so good to see you, dorie. >> thank you, j.j. >> we think of brand often as something that you do in the beginning and it's there forever. you may tweak it a little bit, but your brand is your brand. is that true? >> well actually, sometimes it's not a good idea to keep the brand for the entirety of your company life. i mean one instance of course is where you're actually being dragged behind you with a past.
there's a consultant named alan weise who tells a story about the time a client actually pulled him aside and wanted to counsel him and say, your brand doesn't represent you well anymore, your logo. a logo is a visible manifestation of it. that's kind of the smallest piece, but even something like that can give people the impression of you. but sometimes if your company has moved in a different direction, if you're doing slightly different things you want to update how you're perceived in the market. >> you know what it makes me think of it didn't work out for them, it makes me think of the radio shack commercial where it ran in the super bowl. your brand is stuck in the past and we need to rebrand this. you're giving off the wrong impression. >> absolutely. >> also, you talk about being trapped by circumstances. give me an example. >> yeah absolutely. sometimes society is just moving forward and there may be things that you absolutely can't control. if we think back to a decade ago, the atkins diet was a huge craze. everybody was doubling down on protein, they were getting rid of carbs.
if at that time you were running a bakery for instance that could be a huge problem. literally there were news stories of business dropping off by 40 50% for a lot of these bakeries. what do you do at that point? really what the best strategy is sometimes when you're looking around and the circumstances have changed, we serve lunch too, we're going to start promoting that advertising that. it's no longer about the morning danishs that nobody wants to eat anymore. >> it's not looking back at this is what worked then but look forward, present in many cases, and say are we keeping up with the times? >> one place where you may want to rebrand is if you feel like the essence of your brand has somehow gotten confused in the marketplace, you may want to go back. so burberry was having a lot of trouble. gangsters essentially were starting to wear burberry. they had a lot of profligate deals where they were slapping
the burberry label on everything. is this supposed to be a luxury brand? what they did in order to really reclaim the essence of burberry they cut the licensing deals. they got very strict about what they would put the burberry check on and went back to basics. they emphasized the trenchcoat which is the essence of their brand. now they are back to health and profitability. >> then we talked about when opportunities emerge. how do you determine the shiny object, i should ignore it and this is what i should rebrand. >> when i started my business i was coming off of being a spokesperson for a presidential campaign. >> i decided to become a consultant. i thought, oh, i'll work on political campaigns, i'll be a political consultant. it turned out that a lot of people i knew in the political world came to me and said would you consult for us?
i thought, no i'm a political consultant. then i thought it wasn't about politics, it was how you communicate your message. i opened it up and changed the way i started talking about my business and it opened up a new line of revenue. >> i end this by saying rebranding is a big deal so you shouldn't be doing it rightly. >> no you don't want to just plunge into it willy-nilly because you risk losing your customers along the way. if you rebrand strategically, it can lay the groundwork for another decade or so of growth. >> thanks so much. >> thanks. when we return we'll answer your small business questions on the pros and cons of crowd funding. we'll take you to miami where women and men around the country gathered at the emerge conference. . brought to you by --
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#yourbizsell if i. miami was transformed into a major tech hub when thousands gathered at the emerge america's conference. attendees were kept engaged from start to finish with sessions with investors, accelerators and tech talent who shared their wisdom. the emerge america's conference in miami provided five days of access to new technology and innovative figures who shared their ideas on how to help small business owners move forward. breakout sessions networking events and pitch competitions showcased businesses resulting in a global idea exchange that focused on how technology in particular is disruptding many industries. maria contreras sweet gave a keynote address and was on the hand to give the word out about sba's resources. >> we have counseling across the country.
we have contracting opportunities. because we direct 23% of the federal spend to small businesses which means billions of dollars going to small businesses contracting opportunities. we make introductions, match-making opportunities in the global economy. >> attendees also got an in depth look at the criteria that investors use and how they identified big opportunities. >> you want a entrepreneur team of founders that is 100% passionate, 100% committed. they work hard but they listen and they also have their own opinions and they're really really focused on execution. and when you don't see that in the very, very beginning, it's really hard to be engaged and excited with the opportunity. >> the need to innovate loomed large at the conference. mary speo founder of a tech company called next galaxy spoke at a session called entrepreneurs building empires. her advice is always look at what's next. >> the next big thing around the corner is virtual reality.
it will be on mobile devices, it will be on computers. >> entrepreneurial education and unique college programs that are producing tomorrow's small business stars were also highlighted. >> the university has an initiative called tech runway and that is designed to take some of those fledgling companies that are just winning the business plan competition, moving them up and taking them to the next stage and moving ahead. >> but it was minority and women-owned businesses that took center stage at the conference with owners networking and sharing insights. >> you can't just run an entire company women alone. you can, i'm just saying that it's probably not going to be as successful. you see fortune 500 companies, there is a perfect mix of men, women, different ethnicities, millennial. people have a different point of view. the best way to serve your customer base is to have all those views. >> attendees got to experience a little star power as musical powerhouse pit bull wrapped up
the conference with words of wisdom and encouragement. >> the word can is the word can. the word don't is du. the word impossible is possible. it's time now to answer some of your business questions so let's get our board of directors in here to help us out. slavo reuben is the founder of indy go go the largest crowd funding site. tanya yuki is share glee provider of social content analytics for businesses. thanks so much for being here you guys. good to see you guys. let's go to the first question. it is about access to capital. >> i know some people that have had a lot of success with this crowd funding stuff, and i would love to hear more about it the dos, don'ts, pros cons, all the strategies about crowd funding. >> this question is directed right towards you.
>> the crowd funding. well definitely crowd funding is a great alternative to get access to capital versus any other methods. there's an entire book we can discuss of dos and don'ts. number one you want to have a good pitch. you want to be able to create a video. that way you can raise up to 114% more. you want to be pro active. you want to get updates out there. have an update every four days or less. you'll race four days -- you'll raise more money if you update every four days. if you build it they will come. get the snowball rolling. in terms of the don'ts, don't expect to put it up there, walk away, hope elves will come with bags of money because there's work that you have to put into it. the more work you put into it the more results you'll get out of it. >> i think that is the best point of all, right? you need a base of people to get
it out to so that they can share it with people as well. >> absolutely. people shouldn't be intimidated to think that they need to have thousands and thousands of twitter followers. everybody has an e-mail list friends and family. start with that and get the ball rolling. it will help amplify it. >> tanya, i think when people think of crowd funding they're still confused what crowd funding is. can you give a little insight. >> that's a wonderful question. there's two types of crowd funding. sometimes people are think of them in terms of a cause and nonprofit, other times there is an opportunity to get your business going. if it's rewards based, you have to get your incentives set up. if you want to do it as equity base to fund a business you need to make sure all of the structures are set up before. you're giving away an appropriate part of your business. i want to echo what he said about social proof. people do ignore the first level
networks. we see across social media so many great businesses fail because they haven't mobilized the people that have obligated to help them because they're friends or family to create that momentum and social proof that makes everyone else go me too. >> i think that's a great point. for some people it's so natural to go to them to get them to help and other people feel it's a burden if i'm asking my friends and family. >> i'm going to do it on my own. >> they want to see you succeed. they love you. >> one of the best things to do is put out the ask. you put out the ask. hey, i'm looking to raise $10,000. doing the ask is 80% of the job. this next question is about franchising. >> in terms of franchising, what are the top three characteristics we should look for when we're selecting franchise brand partners. >> great question. any ideas? >> if i were to pick the top
three, i would say culture fit culture fit, culture fit. at the end of the day they have to have the capital skills and capital, but do they share your vision? are they going to really uphold the values of your business? because you're only ever going to be as good as your weakest link. just one franchisee takes the business in a different direction, then it's really going to hurt. it's going to poison the whole well for everyone. >> seems important, also slava, to start small, right? don't go out there and start franchising. start with one that's close by who you can work with really carefully. >> yeah. i think if anything you should always start with a pilot and get paid back. one of the most important things when looking for partners is reference checks to understand what is the feedback people are getting on this person. or on the other side franchiser, what are the reference checks on people working with them. also, you need to have a passion. it's important because somebody wants to be an entrepreneur
they really have plumbing in the background, maybe they're not the right person for the bakery franchise. it's not to be able to get into the business you need to be passion fwhat that area which goes back to culture fit. >> one thing i'll throw in maybe they won't want to hear this, if something isn't working in terms of the systems or some of your franchise partners the problem is always on the other end of the leach. you have to set up the systems and procedures so clearly that you don't have to leave the room for people to improvise and second guess what you would do if you were in that issue. >> start small, work out all of the kinks. thank you guys so much. it was a really great conversation. so good to see you. >> great. >> if any of you have a question for our experts, we answer them every single week here on the show so please send us an e-mail with your question. the e-mail address is your email@example.com. to learn more head over to our website. it is
openforum.com/yourbusiness. you'll find all of today's segments plus web exclusive content. we are also on twitter, it's @msnbcyourbiz and you can find us on facebook and instagram. a skin care company doesn't want to sell its products over the counter. instead, it expanded its sales team to open up new channels. we'll tell you why this has been successful for this small business. until then i'm j.j. ramberg. and remember we make your business our business. brought to you by -- american express for travel and entertainment worldwide. just show them this - the american express card. don't leave home without it! and someday, i may even use it on the moon. it's a marvelous thing! oh! haha! so you can replace plane tickets, traveler's cheques, a lost card. really? that worked?
american express' timeless safety and security are now available on apple pay. the next evolution of membership is here. good evening. rachel is off tonight, this afternoon. this is what every political journalist in america was doing. they were looking at this screen, the screen you're looking at right there on the state department's official website. and they were waiting and they were waiting some more because at 12:30 the state department posted the first batch of secretary of state hillary clinton's e-mails. every single member of the political press went there at the same time and the website had a little trouble loading. so they had to wait for a long time. but eventually, there they were. 296 e-mails, 850 pages. all the e-mails that had been handed over to the congressional committee investigating the attack on the u.s. consu
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