How Entrepreneurs Can Redefine Their Relationship with Failure — Melinda Emerson

Transcription:

Jim Fitzpatrick:
We appreciate you taking the time out of your busy schedule to join us.

Melinda Emerson:
Sure, sure.

Jim Fitzpatrick:
Sure. So let’s kind of jump right in here and talk about… You hear so many business owners that have said, “You know, I tried a business, and it didn’t work, so I went back and got a real job. And you’re laughing, because I laugh too inside. I’m thinking most entrepreneurs have to go through so many failures before they realize that success, but yet so many new entrepreneurs, they’ll do like one thing. They’ll buy a franchise, or they’ll open up a business or whatever. And if it fails, unfortunately, that’s it. They’ve tried their hand at entrepreneurial. And everybody will tell you, “No, you tried a business, and it didn’t work.” What are you kidding me? I must have tried 25 businesses before the one worked, and it looked like an overnight success, but it wasn’t. But I do want to ask you this. What are the five reasons, from your perspective, why small businesses fail? I mean, if you had to give us… Narrow it down to five. I know there’s more than that. But five big reasons.

Melinda Emerson:
Well you know, I want to even back up before I answer that. Let’s talk about failing. The acronym for fail is First Attempt In Learning.

Jim Fitzpatrick:
I love it. We’re showing that on the screen, because that is so true.

Melinda Emerson:
Because I really think what scares me about younger entrepreneurs is people equate failing with failure. And that’s a problem, because-

Jim Fitzpatrick:
It is.

Melinda Emerson:
-what you have to understand is the deal with business and being successful in business is figuring out what you don’t know about business. And my goodness, it’s a wide dearth of things that people don’t know.

Jim Fitzpatrick:
Amen to that.

Melinda Emerson:
I mean, I’ve been in 23 years, and I promise you I learn a few things every week that be like, “Dang, I wish I had known that 12 years ago. So I think that we have to get over this concept of failing, right?

Jim Fitzpatrick:
I agree.

Melinda Emerson:
What I want people to think about is, some lessons just get to be more expensive than others, but they’re all lessons. So it’s like either you win or you learn, and you pray that you only have to learn the lesson one time. Please learn the lesson. Write it down.

Jim Fitzpatrick:
So funny.

Melinda Emerson:
But when we think about what typically sets people up for failure in business, there’s a couple of cookie-cutter things. And the first thing is people have unrealistic expectations about what it is to be an entrepreneur. People have what I call these fantasies of grandeur about having more time and meeting the school bus and being able to do whatever they want. And I’m like, “Whoa, whoa, whoa.” In the first few years of a business especially, your business owns you. You don’t own it. It’s right. It’s going to take all your time and all your money to get it right, to figure out what you’re doing. Who are the right vendors? What is the right pricing structure? What is the right marketing strategy? Where are your ads really penetrating? There’s all this stuff out here you got to get. Right. And it’s like-

Jim Fitzpatrick:
And that’s assuming you have enough money, because as you know, a small business owner’s constantly looking for that next round of funding, wherever it might come from, a small business loan, a loan against your home, an advance on somebody’s pay, whatever it might be. They’re always looking for more money. It’s like oxygen, right?

Melinda Emerson:
And that actually brings me to number two, because number two is the money. It’s not saving enough money before you start and not managing your money well once you do. So what happens is, if you don’t manage your household with a budget, guess what? You’re not going to manage your business with one. And successful businesses are run based on up-to-date financial information. So what happens is people are not talking to an accountant on a regular basis. People wait till tax time to find out what’s going on in their business financially. A mistake. You got to use your accountant like a business advisor. You’ve got to make sure you’ve got a budget. You’ve got to make sure that you’ve got a proper pricing structure. I can’t tell you how many entrepreneurs I meet and they don’t understand pricing. They don’t understand that a percentage of profit margin has to be in every sale. They don’t understand that a percentage of overhead and general administrative costs need to go into that pricing too. Otherwise you could be making sales and not making any money. And so that is probably the second most common thing that I see.

Melinda Emerson:
The third one, though, is people chase anybody that they think has money, as opposed to having a specific, niche target customer. I tell people all the time, “Who makes more money, your primary care physician or your cardiologist?” The cardiologists that I know drive Lamborghinis. So I mean, look, you got to figure out how to become a specialist for what you do. And the simple reason is this. Every small business owner has two things, limited time and limited resources. So why not pick a marketing target that you can actually hit? So you have to niche to get rich. And I know there’s all these people tout here that are afraid to niche. I’m like, “Baby, you win if you niche.” Which company’s going to get work faster, a graphic design company or a graphic design company that specializes in educational materials? It’s really simple. Just focus on serving a specific group of people and become great at serving them. Learn about them.

Jim Fitzpatrick:
I couldn’t agree more. Absolutely. Absolutely. And you know what? When you talk about that sign company, there’s nothing wrong with, if somebody finds their way to your door, even though you’re niche… I love that line, niche to be rich, to get rich. But if somebody finds their way to your sign company while you’re focusing on educational materials and such, and they say, “Hey, can you do this poster? Can you do this?” Yeah, sure, we can throw that in there. You don’t want to leave those dollars on the table. But I can’t agree more that find what that niche is and go after that and then become an expert in it, right?

Melinda Emerson:
Absolutely. And that’s what you spend your money chasing. Now, if somebody calls you and says, “Hey, can you make this poster?” Sure we can. But the reality is where you spend your time, money, effort going to trade shows, meeting people, networking, it’s got to be the people that buy educational graphic design. That’s what it’s about.

Melinda Emerson:
But then here’s the fourth thing, and it’s related, but it’s a little bit of derivative of the last one. People do not focus enough on their existing customers. It’s amazing to me-

Jim Fitzpatrick:
I agree.

Melinda Emerson:
-how often people will spend all their time chasing new business, chasing new business, as opposed to loving on people who’ve already loved on them. It’s like, okay, listen, an existing customer is 60 to 70% more likely to buy from you again, so why wouldn’t you communicate with them? Send them emails, personal notes. Invite them to special sales or special events or a First Friday in your store, whatever. But keep in touch with them. Show them some appreciation. Thank them for their business. And they will not only come back and buy again, they’ll buy more, and they’ll refer people. So it’s like, oh my gosh, figure out how to keep your customers. That is probably the fourth biggest thing.

Melinda Emerson:
And then the fifth thing that we’ve seen, and this probably really became apparent during the pandemic, people don’t know how to sell online. People don’t understand SEO, content marketing, websites, landing pages, social selling, email marketing, sales funnels [inaudible 00:09:03] buying ads. Guess what? Even if you’re going to sell on Amazon, you better know how to buy ads on Amazon. So all of this online marketing stuff is still like gobbledygook to a lot of people, and they’re afraid of it. And part of that is because there’s a whole bunch of snake oil salesmen out here too.

Jim Fitzpatrick:
There are.

Melinda Emerson:
They’re going to get you on the first page of Google. Yeah right. Nobody knows how to do that. Even people that work at Google don’t. The point is that you really have to be smart, because it doesn’t matter what you sell, you better be selling online too.

Jim Fitzpatrick:
I agree. I agree. Even if you don’t have a product or a service that you can sell online. I mean, obviously if you’re a masseuse it’s kind of hard to sell online, but you better be online. You better have your offering online, so somebody can make an appointment, call up, get information, maybe even buy gift cards or pay for it.

Melinda Emerson:
Yeah. You can handle inquiries and payments as a massage therapist online. So there’s no excuse for anyone to not be able to interact with customers online. And people want to find their own information. They’re going to search from their own mobile device. So you got to make sure you got a great website. You got to make sure your website loads quickly. You got to make sure that it’s simple, minimal design, people can find what they need. Don’t be making people search for stuff. And by the way, nobody wants to buy from an anonymous person on the internet. Make sure that your information is easy to find on every page of your website.

Jim Fitzpatrick:
That’s right. And as a friend of mine said one time, “Nobody’s coming, Jim. Nobody’s coming.” I said, “What do you mean nobody’s coming? What does that mean, nobody’s coming?” “Nobody’s coming to your business to tell you that your website is terrible.” They just go to the next business that spent time in there. They’re not going to say, “Let me stop what I’m doing. Let me go over to Jim’s business and tell him all of the problems with his website so that he can get up and running and make money.” No one’s coming. And that holds true for all of you listening. If your website… And Melinda is so dead on on this. If your website is not in order and it’s not ready for business, then you’re not ready for business. So keep that in mind. I’m so glad that you brought that up. I didn’t mean to jump in there, but I’m passionate as you are about this.

Melinda Emerson:
I’m glad you did, because it’s so, so important. Your website is your number one sales tool. It is your welcome mat into your business. That’s right. So are you ready for company? You got links that are broken. You got no way to get people to give you their contact information. You got no free offer up there to whet people’s appetite and show them a little something about what you can do for them.

Jim Fitzpatrick:
I was recently on a website. I was looking at a product for… I have a small boat. And I’m on the website. I’m looking around, looking around. I’m like, “There’s no phone number on this website.” There’s no phone number on the website. I can’t even believe I’m saying this. So I send an email, and the guy emails me back like two days later. I already bought the product from his competitor. And he’s like, “Hey, how can I help you?” I said, “Did you know that there’s no phone number on your website?” He goes, “You’ve got to be kidding me. I didn’t even realize that. Oh wow, that’s incredible.” So just little things like that you may take for granted. Do a full audit of your website. Make sure there’s a phone number. Make sure there’s a way for somebody to get ahold of you. Oh and by the way, make sure that the lead box that you’ve got on your website connects to your email. I can’t tell you how many people go, “I never-”

Melinda Emerson:
Black hole. The black hole contact form.

Jim Fitzpatrick:
The black hole… That’s exactly right.

Melinda Emerson:
Yeah, people love that.

Jim Fitzpatrick:
Oh my gosh. And they’re like, “How come nobody ever called me back?” And they’re like, “What are you talking about? I sent you three inquiries.” “Oh, you know what? That went to the person that left the company last year. It went to their email.” And meanwhile, people are trying to give you opportunities to do business with them, and it’s going, to your point, into the black hole. It’s incredible. But thank you for all of those. Those are great. And I don’t mean to take up too much of your time, but let’s talk about fighting inflation and high gas prices. It’s at the top of mind of every small business owner and every customer that they come in contact with. So what say you on these issues?

Melinda Emerson:
Oh boy. You know, good old supply chain issues, right? We were having supply chain issues before gas became $5 a gallon in America, and now that it is, it’s just costing more to do business. And it’s an unfortunate thing, but we as small business owners, everybody has raised their price on you, so it’s time for you to raise your prices too, and talk to your customers, and negotiate as much as you can to get paid maybe a quarter ahead of time. Really right now it’s about cash flow, and it’s about waiting this thing out. And I don’t know. I’m worried. I don’t know how long it’s going to be before this stuff gets settled back down. I mean, it really could go into the fall. And so you really want to look at your pricing. And I would figure out how to add value without adding price as much as you can, but you have to pass those costs on. If it’s costing you more to ship things, either you have to raise your price or you have to charge them for shipping. You’ve got to figure it out. Because what I don’t want is for America’s small businesses to go out of business because the cost of gasoline has increased or because their vendors have increased prices on them.

Melinda Emerson:
I mean, it’s a hard thing, but if you can, this is a right good time for you to look at your cash reserves. Look at if you know we’re getting ready to go into fall and winter, order products in advance. The last thing you want to do is be out of stock [inaudible 00:14:38]. That is not what you want to do. You want to make sure that you have stock. And also make sure that you have more than one vendor that can get you stuff, because if one vendor’s having a delivery problem, maybe another person can get it to you. But you just want to make sure that you’re communicating with your customers what’s going on. “Yeah, we’re sorry. We had to raise our prices for that. It’s costing us now double to get that in.” And people understand, because last time you went to the grocery store, chicken now costs what? I mean, it’s gotten crazy everywhere.

Jim Fitzpatrick:
It is. There’s no question about it.

Melinda Emerson:
And so small businesses cannot be afraid to raise your prices, because you’re not running a charity. You’re providing a service to your customers. So just do what you can. Raise your fees as much as you need to. Don’t gouge people, because that’s what the big corporations are doing, and they’re going to pay for that in the long run, because some small business is going to innovate and put those jokers out of business. But what I want you to do is raise your prices fair so that you can earn an honest profit on what you sell.

Jim Fitzpatrick:
That’s right. That’s right. Great advice. And you’re exactly right. Small businesses aren’t out there to be kicked in the shin and taken advantage of just because they want business so bad they may not raise the price only to come to find that you brought in $100,000 last month and it cost you $120,000 to do it. That’s not good. It’s got to be the reverse of that.

Melinda Emerson:
That’s called washing without soap. Doesn’t make any sense at all. You don’t want to do that.

Jim Fitzpatrick:
That’s where I went wrong. I’ve got to use the soap. No, I’m kidding. But so let me talk to you a little bit about why online marketing skills are more important than ever before. By the way, for those of you that are not on TikTok, be on TikTok. We’re going to talk about that in a minute. This young lady, Melinda, is on TikTok, killing it. All of her tips and information and everything else you can find there. If you’re a small business owner, in my humble opinion, and you’re not on TikTok, shame on you. That’s where you need to be. It’s free. It doesn’t cost you anything. It takes a little bit of your time that you will get back 20-fold. Not tomorrow. Not, not like “Oh, I put a video up, and I didn’t get rich.” Doesn’t work that way. It’s like going to the gym.

Melinda Emerson:
TikTok is real work for people.

Jim Fitzpatrick:
It really is. No question about it.

Melinda Emerson:
Reminds me in the early days of Twitter, actually. It’s like we struggle to get little followers. We’re all excited we get 10 more followers.

Jim Fitzpatrick:
I know. I know. So tell me about online marketing and the skills. We talked a little bit about it already, but-

Melinda Emerson:
Well, we have, but what I want people to understand is that social media has really become the number one sales channel. Your website is your number one sales tool, but most of the time the way people are finding out about you is through social media. So you have to be strategic about how you spend your time on social media. I believe that most small business owners need to be on just one or two social media sites, and it needs to be the one or two where your best target customer is spending the majority of their time online. You do not want to use Facebook because you like Facebook. You want to use Facebook because that’s where your fish are. But you’ve got to understand all of the nuances that go into it. It starts with content, and then you’ve got to build engagement. You can’t just be one of these people putting links out there. And then you’ve got to look and see, depending on what you sell, can you sell it directly through the social media channel?

Melinda Emerson:
I have a course in my online school, SmallBizLady University, where I teach social media selling. So I will teach you all of the seven top platforms and how you can sell on them, how you buy ads, what’s the best time to buy ads, what kind of content… We go into all of that in my social media selling course in SmallBizLady University. And I built it just because of how complicated this stuff is. So depending on where your fish are, you might need to sell on Facebook, on YouTube, on Instagram, on TikTok, which is now the fourth largest social media site. People don’t know that. You might need to look at LinkedIn, Twitter, Pinterest. There’s a lot of stuff out here. People are making money all kinds of ways. You do not have to be doing everything, but you got to be doing one or two things. So I really think that it’s really important for people to not be afraid of it, to embrace it, to learn, because you want to be everywhere your customers are, and you want to make it super easy for people to click and buy.

Jim Fitzpatrick:
That’s absolutely right.

Melinda Emerson:
And that is why online marketing skills are so incredibly important.

Jim Fitzpatrick:
So, Melinda, tell us again what the name of the course is. We’re going to show it on the screen here. And so tell us a little bit about that.

Melinda Emerson:
My course is Social Media Selling, and it’s in smallbizladyuniversity.com. And matter of fact, if your folks go out there in the month of June, it’s my one year anniversary of my online school, so I got a coupon.

Jim Fitzpatrick:
That’s great.

Melinda Emerson:
[inaudible 00:19:30] coupon SBL100 [inaudible 00:19:34]

Jim Fitzpatrick:
Okay. We’ll show that too, SBL100.

Melinda Emerson:
Yeah, $100 off all of my online marketing courses. So I have three. So I have How to Sell and Market Online, Social Media Selling, and Ultimate Guide to Email Marketing. And that code works for any of them.

Jim Fitzpatrick:
Folks, unless you’re already an expert at this, for those small business owners that are listening, this is the best investment that you can make with your time and your money, doesn’t really matter. It’s going to equate to a larger bottom line for your company, period. If you hear nothing else today, this is where you need to win. And it’s not as expensive as you think to be in this area, to play in this area. Some of it’s free. She’s going to tell you in the class that a lot of the things that we’re going to… They’re going to… Not we’re going to, but she’s going to show you are actually free. They don’t cost you anything to do in social media. But you got to know how to do them. That’s the key.

Jim Fitzpatrick:
So do not underestimate the importance of social media. And if you don’t know what you’re doing, run, don’t walk to your computer to sign up for this course, because I’m telling you, it’s the single greatest thing you can do today to move your business in forward in the right direction, because this is where your customers live every single day. The average consumer today spends over five hours on screen time on social media. You know who I’m talking about out there, because you wake up to it. You go to bed to it. You sit in your bed. You sit in your car. You sit wherever. You sit at lunch. You sit at every meal checking out social media. So be there and get the information. They say knowledge is power. In this case, knowledge is definitely power, and she’s going to give it to you. That’s why we love when Melinda comes in to The Atlanta Small Business Show, because so many people have come back and said, “Have her on more. Oh my God. She knows what she’s talking about.” So why screw this up? She’s made it so easy for you.

Jim Fitzpatrick:
But let me ask you this about Facebook, because this question comes up a lot. Should I have a separate Facebook account for my small business versus my own Facebook account?

Melinda Emerson:
Okay. So this is a yes and. So I believe everyone should have a business page, which is also known as a fan page on Facebook. Now there are people like me out here who had a personal page before Facebook created business pages, and those people are in a rock and a hard place, because anybody that’s your friend doesn’t want to go be your fan. But you can do a scorched earth policy and say, “Look, I’m no longer active on this page. If you want to talk to me, go be on my fan page.” And one of the things that I do is I disconnect from people every day. On their birthday, if I don’t really know them, I disconnect from them. So I’m trying to slowly but surely migrate people over to my fan page.

Melinda Emerson:
But no, your fan page is where you want to be, because in order to buy ads on Facebook, you have to have a Facebook fan page. [inaudible 00:22:26] buy ads from your personal Facebook page. So use that to communicate with your high school and college friends, show pictures of your kids. But if you want to do business, do business on your fan page.

Jim Fitzpatrick:
Yep. Fantastic advice, and I couldn’t agree more. Melinda Emerson, thank you for so much time that you’ve given us here on the show. I know small business owners, maybe you don’t even realize it yet, but the kind of consultation that she’s giving you here on these shows, on these segments here at ASBN, are invaluable. And so spend some time online with her. Get the information that you need, the knowledge that you need to drive your business forward. You will thank me later for this. I might even ask you for a bit of the profit that you picked up in addition to the… Just kidding. But the name is Melinda Emerson. She’s CEO of Quintessence Group and also a small business expert, but you already know that. And she’s also a bestselling author. Pick up the book. We’re going to show it on the screen here as well. So Melinda, thank you so much for joining us on the show. It is always a pleasure catching up. And the information you’re giving to small business owners in the Atlanta Metro Area is priceless, so thank you.

Melinda Emerson:
Oh, it’s always my pleasure. I’m always happy to come back.

Jim Fitzpatrick:
Thanks so much.