Your Business Matters AlexanderAbramson.com • (407) 649-7777 October 2019
Business Horror Stories
Mistakes That Will Haunt Your Company
It’s amazing how fast this year has flown by. It seems like we were just celebrating the Fourth of July, and now Faith and I are getting ready for the onslaught of trick-or-treaters! With all the ghouls and goblins taking to the streets, I thought now would be a good time to cover some scary material myself. Plenty of mistakes and missteps can haunt entrepreneurs, but the following examples are terrifyingly common. The Curse of Incorporation This is an error that many first-time business owners make right at the outset of their venture, and it can plague them for decades if left unaddressed: They choose the wrong business entity. Amid the excitement of launching a company, it can be easy to overlook the little suffix that will follow its name. Does it matter if your business is an LLC, PLLC, or Inc.? Well, yes — quite a lot. The type of business entity you form can have huge legal and tax implications and can even affect how it operates. Not putting enough thought into the exact designation you want for your organization can lead to a lot of headaches down the road if you discover you can’t structure your
business in a way that makes the most sense or take advantage of the same tax strategies as your competitors. Many companies end up being like Frankenstein’s monster: an inefficient combination of mismatched parts. The Phantom Partnership Agreement All too often, when disputes between business partners break out, both parties make a horrifying discovery — they don’t have a partnership agreement in place to resolve disputes. This is another element of starting a company that gets left by the wayside. Why think about hypothetical disputes and “unforeseen life events” when you could be working on flashy branding and exciting marketing campaigns? When you don’t have these important documents to ward off the specter of litigation, the results can be disastrous. Not having a comprehensive partnership agreement between all of the owners has the potential to destroy the value of your company. Not only could the resulting legal battle eat up huge amounts of time and money, but it could also deeply damage the business's valuation. Worse still, disputes may become so tangled that the state simply chooses to statutorily dissolve your organization. A Boardroom With No Exit This is a mistake made by those toward the end of their business cycle, but it’s a big one. Not having an exit strategy planned in advance is a risky move for any entrepreneur. As I mentioned last month, everyone leaves their business
eventually, often sooner than they planned. Failing to ensure that you have a plan for this departure can spell heartbreak for you, your loved ones, and your employees. You should take a hard look at what you want your exit to look like and plan for that. Do you want to amass enough wealth for a comfortable retirement? Are you hoping to leave a legacy for your grandkids? Do you want to see the business you built go on to do great things, even as you take a step back? All of these goals are possible, but not without forethought. It’s especially important to have an estate plan in place in case tragedy strikes. Without one, your spouse may be caught in a bitter probate battle for the right to run or sell your business. These nightmares have spelled the end for countless companies and drained the resources of even more. Thankfully, there’s a silver bullet that any entrepreneur can use to fend off these ghastly monsters: proactive action. Whether you are incorporating a business, entering into a partnership, or setting your goals for the future, taking each of these steps carefully and with proper legal counsel will always be better than taking them quickly and alone. That way, these nasty surprises can never creep up on you.
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PUT YOUR BEST CARD FORWARD
A Woman’s Guide to Corporate Success
Business Card Etiquette in 3 Different Countries
While Mireille Guiliano is best known for “French Women Don’t Get Fat,” her book on healthy eating and balanced living, authorship is actually her second career. Before she took up the pen, Guiliano was president and CEO of the French Champagne brand Veuve Clicquot. She developed Veuve Clicquot’s reputation in America almost single- handedly over a 20-plus year career, and now she has chronicled that success in her 2010 bestseller “Women, Work & the Art of Savoir Faire: Business Sense & Sensibility” — a guide to climbing the corporate ladder geared specifically toward women. Just as “French Women Don’t Get Fat” upended the typical diet book format, “Women, Work & the Art of Savoir Faire” leaves the usual business book style behind almost immediately. As Guiliano writes in her introduction, “This isn’t another business book that tells you how to ‘succeed’ or ‘get the corner office.’ Yes, of course, you’ll find advice on getting ahead and getting promoted … but more than that, you’ll find advice on being happy and living a good life, even while you are making the biggest contribution you can to the workplace. That’s why I dare to talk about style, and clothes, and food, and wine, and entertaining, and LIFE in a business book. We don’t work in a vacuum.” Guiliano is true to her word. Between the covers, readers will find advice on topics as far-ranging as developing the perfect handshake, choosing catering for a business dinner, dressing for success, and putting together an effective presentation. Guiliano has plenty of experience to back up her counsel and shares amusing anecdotes about the food and beverage industry, French culture, and her own journey along the way. There are no easy three-step solutions here, only long-term goals and strategies. What really makes “Women, Work & the Art of Savoir Faire” unique is that it caters specifically to women in pursuit of high-powered CEO or CFO jobs. Guiliano covers circumventing prejudice right alongside choosing a dress and tips on being the perfect lunch date. Still, both men and women will come away from this book with ideas about how to achieve success without sacrificing the pleasures French women hold so dear.
The business card is a nearly ubiquitous way to give your name, position, company, and contact information to potential clients and business partners all over the world. And while the exchange of business cards in the United States does not come with a lot of pomp and circumstance, that is not the case in many other countries. If you find yourself in one of the following places, remember these tips about exchanging business cards. Japan Known in Japan as meishi , the exchange of business cards comes with a lot of ceremony. Present your card with both hands, as this gesture is seen as respectful. Japanese culture places a lot of value on hierarchy and status, so make sure your title is listed prominently. When receiving a card, take a minute to look it over and comment on it. Immediately putting it away is disrespectful, and once you’re done looking at it, put it in a cardholder, folder, or binder. and contact info in English on one side and in the local language on the other is good practice. Gold lettering is considered auspicious, and if your business is relatively old, make sure the year it was founded is on your card. The practice of giving and receiving cards is very similar to that of Japan. Finish the exchange with a bow as a way to thank your acquaintance for meeting with you. India Business cards are exchanged even in nonbusiness interactions in India. Much like hierarchy and status are valued in Japan, academic achievements are valued in India, so list your university, degrees, and honors along with your other information. When exchanging cards, always give and receive them with your right hand. This is also common practice in many Middle Eastern countries. Exchanging business cards the wrong way probably won’t be detrimental to your business deal, but learning the proper etiquette in the country you’re visiting can go a long way in starting a professional relationship on the right foot. China In China, as in many other countries, having your credentials
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Reignite Your Passion As entrepreneurs scale their businesses, there is a lot to focus on: hiring the right staff, creating the most effective marketing strategies, and setting up efficient operations. With so much to do, it’s easy to lose sight of your initial vision for your company. If you’re stuck in a rut, know that you’re not alone. Plenty of the most successful entrepreneurs have endured the same struggles and, with a little ambition and a lot of creativity, came out on top. Take Henry Ford, for example. Henry Ford made the automobile accessible and appealing for the common citizen. This ignited interest in the market from consumers and manufacturers alike, which led to innovations like air conditioning and other appliances we can’t imagine living without today. There were some key
Lessons in Innovation From Henry Ford
factors that played into his success, and, if you apply them to your own journey, you could gain a new perspective and be inspired to create and innovate in your industry. Consumer-Focused Ford realized cars were unreliable and unaffordable to most and set out to change that. After developing the first moving assembly line, Ford lowered the price of cars and made them accessible for people outside the upper class for the first time. As long as you keep the consumer and their needs in mind, you’ll find ways to make their experience better and increase your success. Small Changes, Big Impact Unlike many companies today who sacrifice quality for quantity, Ford found ways to focus on both. He looked at how cars were actually made and found that, if he could build more cars within a certain time frame, he could pay less per car, per worker. Thus, the moving assembly line was born. When looking for ways to innovate in your industry, rethinking even the smallest, simplest details can make a huge difference for your business. You may not be able to reinvent the wheel, but who said you couldn’t reinvent the brake pads? Henry Ford may have changed the automobile industry forever, but you don't have to go to such lengths to innovate in your own. The next time you find yourself uninspired or stagnant, look to those who made your industry what it is today. You might just find the inspiration you’ve been searching for.
HAVE A Laugh
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Inside This Edition
Business Mistakes From the Black Lagoon
Tips for Women Climbing the Business Ladder
International Business Card Etiquette
How Henry Ford Innovated His Industry
Have a Laugh
Play This Song to Your Sales Team
‘Got My Mind Set on You’ George Harrison’s Sales Advice In conversations about sales, one doesn’t usually think of George Harrison. But the truth is that the Beatles’ lead guitarist actually has some solid words of wisdom when it comes to converting warm leads. His last No. 1 hit single, “Got My Mind Set on You,” may sound like dated courtship advice, but it’s actually the perfect road map for turning interested parties into loyal customers. ‘I Got My Mind Set on You’ The theme of the song is painfully straightforward: A lovestruck singer has his mind set on dating someone. While your mileage may vary on single-minded romantic pursuits, this level of unwavering dedication is a must for warm leads. Unlike the mystery woman of Harrison’s song, these are people who have shown interest in your business. To build toward a sale, you have to return the favor. Send personalized emails or newsletters, or pick up the phone and call them.
and giveaways are your best friend. Targeting these special offers specifically at your warm list is a great way to cultivate lifetime customers.
‘It’s Gonna Take Precious Time’ The No. 1 mistake sales teams make is giving up on leads too early. If you dump a prospective customer because they hesitate on your first few attempts, you’re shutting the door on future profits. Depending on your business, leads that take months or even years to convert
can more than make up for the time and effort you’ve spent on them. Customers won over this way are far more likely to stick with you. ‘To Do It Right’ The final conceit of George’s song is that there may be other ways to win a person over temporarily, but this is the right way. By remaining dedicated and spending the time and money to build your relationship, you can win over lifetime customers — no singing required.
‘It’s Gonna Take Money’ As the first verse of the song suggests, building this promising relationship isn’t going to be cheap. If someone hasn’t already taken the leap to become a customer, they need some incentive to get serious. This is where free trials
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