Common Mistakes with Equipment Leasing

Sometimes small business owners and entrepreneurs hastily get equipment leases. Without being well informed, they run into problems. To help you to avoid a headache in the long run, here are the top mistakes business owners tend to do when they sign their equipment lease.

1. Having an absence of lawyers. Although it may seem like a costly endeavor, we highly recommend reviewing the lease contract with a lease attorney. It will help avoid bigger problems in the future if you take the time now to make sure the terms and conditionals are fair and legal.

2. Using short contracts. Although short contracts are quicker to read, long contracts will have the potential to discuss not just terms but other possible issues. If anything comes up, the issue will always go back to what the contract entailed.

3. Not considering long-term goals. Always think through the purpose of your equipment lease. Will you use the equipment when the lease ends? How long do you plan to use it?

4. Lack of communication. This is always a problem in every facet of life. It is very important to have open communication with your leasing company. If something is not clear or does not look correct to you, don't be afraid to ask your leasing company. Make sure that all issues are out in the open and clearly communicated.

5. Incompatibility with software and hardware lease. A software lease and a hardware lease are two different kinds of leases. Sometimes software does not always work on the hardware. It is very important to research this before you purchase your equipment.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Five Tips on Improving Your Cash Flow

Cash flow is imperative to every business. It is how you are able to conduct your business every day. Cash flow is the flow of your working capital that come in and goes out of your business. It consists of your inventory, accounts receivable, accounts payable, capital expenditures and debt. To maximize your cash flow, try one, if not all, of these tips.

1. Get a good accounting system. Quickbooks and Peachtree, both great accounting programs, offer free trials. See whether they work well with your business and consider purchasing it.
2. Pay attention to accounts receivable.
3. Pay attention to account payable.
4. Consolidate your debt.
5. Lease equipment. Leasing equipment helps to conserve working capital, liquidity, and credit lines. It allows flexibility that can be vital to small businesses.

Paying attention to your business and getting the programs and equipment you need can really help your business to improve its cash flow.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Using Social Network Sites to Promote Your Business

To help your company continue to grow in the expansive Internet, try social networking web sites. Social networking sites create human connections. They help you to make new relationships with other businesses. You can effectively promote your business. In addition, they allow you to have a strong link back to your website.

Although online communities are thought of as something for just those 25 year and younger, these sites have been pushing the boundaries. They become such a powerful asset that companies who shrug them off are most certainly losing out in the long run.

Online communities basically give you a page to write about yourself and/or your company. You can write about anything you want on your page. Make sure you have a link to your company's web site. This will really strengthen your external links and your PageRank. Depending on the site, you will be able to make friends, join groups, or even have other people become a fan of your company.

Here is a list of some social networking sites that are free:

• LinkedIn - Connects professionals - www.linkedin.com
• Spoke - Connects companies - www.spoke.com
• Facebook - Connects individuals - www.facebook.com
• MySpace - Connects individuals (usually a younger audience) - www.myspace.com

Seeing that the sites are free and the outcome is great, you really have nothing to lose.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Wise Tips to Sending E-mails

Marketing through E-mail, despite its bad reputation, can be an effective way to promote your business. How and when you send the message will greatly affect whether it gets viewed or not. Consider the following questions when developing your e-mail marketing campaign:

• What type of e-mail are you sending? Are you sending e-coupons, newsletters, customer success stories, or an ad of a new product? Depending on your business, you can implement many different types of approaches. Varying the type of e-mail will keep the viewer interested and intrigued.
• When your customers will look at e-mail positively? Would they be more likely to view the e-mail in the morning during work hours, afternoon at their lunch break, or evening at home? Would they be more willing to view the message on Monday, Wednesday, or Friday?
• How often will you send email? Do you plan on sending it once a week, once a month, etc? Consistency is key here. If you plan to send out an e-mail a week, make sure you send out an e-mail a week.
• Always have holidays and special events in mind. Including them proves that the e-mail has been well thought out and is thus not a generic template.
• If you have an e-mail with a link to your website, provide a special page and, using a website analytical program (Google offers one for free), see how many people visit that page. This will measure the success of your e-mail.
  

Considering these few ideas will strengthen your marketing campaign. Experiment to see what works for your company.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

'Tis The Season

Christmas is the time for giving, and what better way is there to give than of your time and hard work. Volunteering this holiday season is rewarding for every type of worker, whether it be an employee or employer.

To find out where and how you can give, go to www.VolunteerMatch.org. They offer many different opportunities for your and your employees.

VolunteerMatch.com also explains the benefits of giving: (http://www.volunteermatch.org/corporations/resources/businesscase.jsp)

Benefits to the Employee

• Improves performance
• Increases job satisfaction, attitude and morale
• Encourages teamwork
• Promotes leadership and skill development
• Improves communication between employees and their supervisors, and across departments

Benefits to the Corporation

• Builds brand awareness and affinity
• Strengthens trust and loyalty among consumers
• Enhances corporate image and reputation
• Improves employee retention
• Increases employee productivity and loyalty
• Provides an effective vehicle to reach strategic goals

Benefits to the Community

• Provides skilled and talented volunteer pool, as employees devote personal and professional skills to community needs
• Offers direct cost savings for community service organizations in saved recruiting and labor costs
• Creates quantifiable social impact
• Helps bring community needs into focus

Volunteer in your community today!

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Improve the Customer Experience on Your E-commerce Site

You can lose hundreds, if not thousands of dollars by making a poorly constructed website. Customers will become frustrated and want to take their business elsewhere. To provide the best website experience for your customer, try to implement some of these tips.

• Have contact information easy to navigate to.
• Have thought through navigation. If you have sub navigations, make it obvious and easy.
• Have a search box. This will help customers get to what they want quickly. Most website visitors want to get to what they are looking for in three click or less. Having a searching function can get the visitor to their product in two clicks.
• Having good search results. It is very disappointing to be shopping for a green phone, search, and get a list of text links. If you can, have images come up in the search results.
• Good content that is easy to find.
• Offer a breadcrumb trail. This is a trail at the top of the page that lets the visitor know exactly where they are in relation to the structure of the site. For example, the breadcrumb trail could be "Apparel > Watches > Men's > Sport."
• Have pleasing colors (please, no neon green against neon pink!)
• Strong checkout that spells out where the customer is and what they need to do. Amazon.com spent thousands of hours and millions of dollars to develop their 1-Click shopping method. You can never go too far to have a strong shopping cart system.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Keep Stress Low

Keeping stress low is very important to your health. Stress can affect you mentally, physically, or emotionally. In the business world, it is hard to completely avoid stress, but you can work hard in keeping it at a minimum.

Stress without relief causes many physical symptoms, like headaches, upset stomachs, elevated blood pressure, chest pain, a lowered immune system, and problems sleeping. Stress can also lead to short tempers, depression, panic attacks, or anxiety. Constant stress has been linked to heart disease, cancer, lung problems, and more.

Recognizing stress can be difficult sometimes. Noticing its symptoms is the first step. The second step is to take action.

Here are a few things that you can do to help reduce stress in your life:

• Don't take on more than you can handle.
• Practice time management.
• When stressed about having a lot of projects, don't look at the big picture. Try to work with "bite-sized pieces."
• Reduce the things that stress you.
• Get enough sleep.
• Listen to relaxing music. Classical and new age music proves to be more calming than rock or rap music.
• Eat well and exercise.
• Practice breathing exercises.
• Take breaks. It is good to stop working, even for 10 minutes, to think about something completely different. Breaks will help refresh your mind.
• Be thankful. This one is always helpful because as you get caught up in all the things that bother you, it can be relieving to look at all the things that are a blessing in your life.

It may be difficult at first to see the stress and act against it. It is well worth the effort though. Reducing your stress will help you to be a happier, healthier person.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Leasing IT Equipment

Is it time to upgrade your IT equipment? It's very likely that things have changed in your business since you last bought the computers and programs that your business depends on. Your company may be growing faster than you anticipated or it just may be time to boost productivity.

Many companies prefer to lease their computer technology because it keeps their equipment up-to-date. IT equipment is subject to rapid depreciation becoming obsolete quickly. A lease allows the customer to transfer the risk and financial burden of obsolescence. After the lease expires, the customer is able to upgrade to newer and faster equipment. Leasing technology equipment also helps a company to stay on the cutting edge and keep up with its competition.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

E-mail Campaigns

E-mail is one of many ways to promote your business. It can be your strongest asset if handled correctly. Marketing campaigns via email can really help to strengthen a business. You can promote new products/services, give away coupons, or offer words of wisdom. There are a few things that can really help save time, promote your business,and keep your customers interested.

Firstly, remember to ALWAYS put a link to your website in your e-mails. You want your customers to get excited and visit your site for more information. Think how detrimental that could be if you did not include a link to your site.

One thing that will save time and effort is to plan ahead. Write, design, and complete all the e-mails you are sending out that year. If you want to do a twice-a-month e-mail, make 24 designs. To get started, you can set up the campaigns like this:

Month: (use the date which you will send the e-mail)

Subject: (title of the e-mail)

Body: (all the content used in the body of the e-mail. Specify the pictures, colors, and the exact wording.)

Tips for the Subject:

• Keep it short and simple. Never use more than 10 words. Using 5 words is even better. Use strong and direct words, never "fluff" adjectives like "very."
  
• Ask a question. This will entice the viewer to want to see more. Use seasons and holidays in your title. Something like "Lose 10 pounds for the summer" or "Back to school tips" will helped the e-mail to be viewed more.
• Never use the word "free," "limited time offer," "buy now," or other sales terms. These are considered spam keywords and your e-mail will most likely be blocked. Also, don't make the words in all caps or end in multiple exclamation points.

Tips for the Body:

• Show the benefits of your product/service/advice.
• Never make the e-mail apparently generic. Try to make the e-mail personal, like you wrote it just for them.
• Like the season/holiday-related subject, make your body be similar.Use bright yellows and blues for summer. Use fall leaf images in autumn or emerald evergreen trees in December.
• Again, don't use the spam keywords.

When you plan ahead with you e-mail campaigns, you will never run into the "it's the end of the day and I forgot to send out our monthly e-mail." Your e-mails will be more thought through if you take the time to sit down once and write them all out. You will be glad you planned ahead when your day is busy.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Great Informational Websites

It seems like no matter what we need these days, we often turn to the internet to help us whether it's to research products, find information, purchase goods and services, hire employees, book travel, arrange shipping, or much more.

The new year is right around the corner and you might be asking yourself what you need to do to generate even more business. So here are a few websites that will help you build and run your business throughout the coming year. These are websites for market and industry research:

• U.S. Census Bureau - www.census.gov - has a vast amount of free information on all aspects of American life. Want to know the percentage of college graduates in Cleveland or how many baby boomers live within a particular zip code? This is where you'll find this information.
• "County Business Patterns" - www.census.gov - is very useful for finding information about businesses.
• American Fact Finder - www.factfinder.census.gov - is aimed more at finding data about people and demographics.
• Experian - www.experian.com - Offers free credit reports in addition to many other services.
• D&B - www.dnb.com - Offers global risk, credit, sales, marketing and supplier management solutions.
• ERsys.com - www.ersys.com - is a quick and easy way to find information about a city where you might be planning to do business.

The beginning of the year is a great time to research new customer opportunities and new markets. Setting goals and staying focused will allow you to realize increasingly better results.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

End of the Year - Part 2

It's almost year-end, and while most of us are still scratching our heads wondering how the year went by so quickly, accountants are getting ready because year-end means that tax time is just around the corner. The good news is that there are things you can still do this year to maximize your 2008 tax planning.  Always talk to a tax professional first because every company's situation is different and there may be tax savings that are more suitable for your particular company.

Section 179 is a nice benefit for businesses- especially nice for small businesses.  Section 179 allows companies to deduct the full cost of eligible business equipment on the 2008 return, as opposed to spreading it across several tax years. For 2008, a business is able to expense up to $250,000 in capital expenditures provided the total purchase amount is under $800,000.  Eligible property includes machinery, equipment, furniture and fixtures, most storage facilities, and single-purpose agricultural or horticultural structures.

The main goal of year-end tax planning is to increase expenses and delay income. Buy any needed equipment now. Expanding equipment cuts your adjusted gross income, lowering your tax liability. You can also pay bills like rent, insurance, and utilities early and stock up on office supplies.

If you haven't set up a retirement plan yet, now is the time to do so. Qualified plans must be established by December 31 in order to provide deductions for this year.  This is a great way to lower your taxes and protect some of your income.

As this time of year is the season of giving, don't forget to be charitable.  An individual can write-off between 20-50% of their adjusted gross income. Corporations can write-off of up to 10% of their taxable income.  Just remember the IRS requires a written receipt for any donation of $250 or more.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/). Brad is a frequent contributor to online publications and
newsletters, and is the author of this blog on commercial financing
topics.

Being Thankful

Sometimes as business owners we can get caught up with all of the negative aspects of our work week. Although it is good to look at the bad to improve your company, try not to dwell on it. It will affect the way you see things which, in turn, hurts your business.

This Thanksgiving, consider all of the good that comes from your work. It will keep you focused on the positive in your life. Try making a list of things you are truly thankful for, such as health, prosperity, or support from your family, coworkers, or community. The list could even include smaller things, like enjoying the people you work with, your landlord being easy to work with, or your excellent cup of coffee in the morning. Thinking on these things will help put any negatives in perspective.

Being thankful will also help your business. Thankfulness breeds joyfulness. A joyful business owner, boss, and employee will help make and maintain good customer relationships.

At First Star Capital, we congratulate and encourage you in your business. We hope you will have a wonderful Thanksgiving this year.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Different Kinds of Leases

When considering a lease it is important to know the different lease structures that are available. The two most common lease structures utilized are capital leases and true leases.

A capital lease, also known as a finance lease, has a "bargain purchase option" at the end of the term, such as $1.00 or $101.00 depending on the tax laws in your state. A capital lease is best when the intention is to own the equipment at the end of the term. This structure allows the lessee to depreciate the asset and write off the interest. Capital leases often appeal to companies that prefer to own the equipment but want to preserve their working capital and any existing bank lines.

True leases provide the option to return the equipment to the lessor at the end of the term. A true lease is best for companies that need to regularly upgrade their equipment and is commonly used for technology assets that are subject to rapid obsolescence. A true lease can offer lower monthly payments with "off balance sheet" reporting. These structures are typically best for companies that are interested in minimizing their tax liabilities due to the "line item" deduction of the entire lease payment as an operating expense.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Short on Capital, but Need New Equipment to Grow?

One of the greatest advantages of leasing is that it offers fairly minimal up front costs. Unlike bank loans that may require a substantial down payment, all that is generally required at the beginning of a lease is two advance payments. With some programs, even less is required. In addition, leasing protects against equipment obsolescence because you set the lease terms according to the useful life of that equipment.

Leasing can also lessen the burden that taxes have on your company's wallet. Depending on how your lease is structured, you may be able to fully deduct lease payments as a business expense. This type of lease structure is known as a True Lease, or FMV-lease. Each monthly lease payment is treated as a "line-item deduction" for tax purposes.

Business owners and executives are facing ever-increasing demands. Growing competition and operational efficiencies can provoke challenges to the bottom line. Leasing new equipment could be your solution for your company. As a Chinese proverb states, "Be not afraid of growing slowly, be afraid only of standing still."

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

10 Tips for Making a Strong Website

Your website can be a great way to promote your business - if built correctly. I have literally left websites (thus taking my business elsewhere) because of the unprofessional look and feel of the site. You don't need a Bachelors in web design to build a strong website. Try the following to strengthen your site:

1. Organized content - This is always the #1 website rule. If you have ever entered a website that is not organized properly, you feel lost and frustrated very quickly. Spend time in making a chart of the structure of all the pages in your website.
2. Consistent navigation - This is likewise very important. Make sure that your navigation is the same throughout the whole site. This really helps the visitor.
3. Regularly updated, quality content - Your website is to give information to your visitors. Make sure it is doing so. Spend extra time in making your pages have the best information you can give. The second part is to update often. I have heard to update websites once a day. This may seem overwhelming, but try to incorporate something that would be new each day, like a new blog post, video, or product.
4. Make your contact information easy to access - Make sure that it is easy for your customer to be able to contact you. That is, after all, the reason for the website. Add you company name, phone number, and address at the bottom of every page. Also, make sure to have a visible link on every page to a "contact us" page.
5. Add a search box - This can be especially important if you have more than ten pages or an e-commerce site.
6. Strong links - Try to stay away from any "click here's", be more specific like "view our new line of products" or "download our catalog."
7. Relevant keywords in page body - Choose a string of about 25 keywords and try to use them in the page as much as possible. Be sure not to make it overly apparent. No reader will enjoy reading the same word over and over again.
8. Relevant keywords in page titles - This will help search engines to know what the page is about.
9. Meta tags - To help search engines find you, use meta description and keywords on your pages.
10. Professional photos with accurate ALT tags - You don't need a professional photographer to make the photo look professional. Just make sure that the lighting is good and the image is not grainy. If you have a photo editing program, you can enhance the colors and delete any unwanted elements in the picture.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Successful Time Management

Time is of the essence. It seems these days that there is simply not enough time in the day to do everything we would like to get done. The key is to be more productive in the time that you have. Sure, you can work twice as long and get much more done. However, the secret to true success is making the time you currently invest in your business twice as productive.

Successful people know how to divide their time well. They know when it's time to focus and be productive and when it's time to replenish and rebuild their strength. It's not uncommon to see people who appear to be highly productive burnout quickly. It is important to take time out for yourself and relax. Spend time with friends and family, exercise, sleep, or do whatever else that may help you regain your thoughts and energy.

Successful people are also strict about what types of interruptions they allow during productive business time. It is easy to let trivial interruptions disrupt our working life. For example, don't take inventory or clean out your desk during prime selling hours. Find ways to eliminate busy work.

Identify the most important thing you should be doing right now. Successful businesspeople always tackle the most important things first. The items of top priority are usually not the easiest. That's why we tend to put them off until later. Getting these heavier items out of the way will relieve stress and increase your productivity tremendously. Over time you'll notice that sales have increased and you're enjoying your work a lot more.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

End of the Year - Part 1

It's nearing the end of the year and holiday parties and family vacations are fast approaching. It's also a time we typically look back at this year's numbers and sales and examine strengths and weaknesses. What areas can the business make more money? What areas can we save money? A topic that is usually more important for new businesses, but one that is good to review for established ones, is the entity in which your business operates under. The right entity choice will help you respond to or take the best advantage of changes in law or changes in the nature of your current business. Entity choice greatly affects your legal liability for the entity's debts, liabilities, and other obligations and the extent to which creditors can reach or even go beyond business assets to reach your personal assets.

There are six basic business forms of for-profit businesses in the US: Sole Proprietorship, General Partnership, Limited Partnership, Limited Liability Partnership, Corporation, and Limited Liability Company (LLC). Each carry their own tax rules. Depending on the nature of your company, having your business under the appropriate entity can have a major impact on cash flow come tax time. For some useful knowledge on business legal organizational structures, check out this article: http://entrepreneurs.about.com/od/businessstructure/a/bizstructures.htm

Just as important as having your company under the right entity, is doing all business within that specified entity. Also, file and maintain the appropriate documents with the state your business is located. Late fees and penalties are a waste of resources. For corporations, LLC's, and partnerships, remaining "active" and "in good standing" with the Secretary of State is vital to secure funds from lending institutions. Check on your corporation's Secretary of State filing here: http://entrepreneurs.about.com/od/generalresources/a/secretarystate.htm

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Act Quickly on Section 179

October is the perfect time of year to look into the Section 179 Deduction, also known as the 179 Expense Election. Small businesses or those who spend less than $800,000 on capital equipment this past year may expense a capital equipment acquisition up to $250,000. If more than $800,000 is spent on capital equipment, the amount of the deduction declines as the amount spent increases.

To qualify, the property must be business equipment used in the business at least 50% of the time. Permanent structures do not qualify, although some single use farm buildings do. The equipment may be new or used and must be acquired during the 2008 tax year, from an entity not controlled by the purchaser.

If you lease or finance the equipment, the deduction may be greater than the investment required to initiate financing. For example, suppose you leased a piece of equipment in December of this year that costs $300,000. You have the ability to write off $250,000 but you have only invested the first and last payment to start the lease. The write off exceeds the investment you made to get that piece of equipment, resulting in a lower tax bill.

As always, talk to a tax professional first because every company's situation is different and there may be tax savings that are more suitable for your particular company.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

8 Customer Service Blunders

Every customer values good customer service. Customer service can be a company's greatest asset or its greatest impairment. To keep you company image strong and your customer service top-notch, avoid some of these mistakes:

1. Having an untrained staff. No matter how many employees you have in your company, make sure that every one of them are trained. Customers will not tolerate incorrect information or lies, which can sometimes happen when the employee does not know how to help.
   
2. Trying to win the argument. Keep in mind that the "customer is always right." It is far more difficult to gain one new customer than to keep a current one.
   
3. Standing by your policy. Taking care of the customer is far more important than standing by a policy.
   
4. Not fulfilling your promises. If you make a promise to a customer, make sure that you will fulfill it. If you promise something will be there by Wednesday, you make sure it is there by Wednesday.
   
5. Being inaccessible. Be sure to always be able to be contacted by the customer. Nothing is more frustrating than not being able to reach the person, or even just a person, to talk to. Also be sure to be diligent in calling customers back. Calling a customer back quickly will always win points in their book.
   
6. Having poor record keeping. Make sure your notes on the customers are correct and that you are addressing the right person. Nothing is more frustrating for a customer than having been promised their phone bill would be canceled, then being charged fees for not paying the bill.
   
7. Not listening to the customer. Sometimes customer service representatives do not listen to the customers and answer with non-relevant responses. Make sure to pay close attention to the customer and to their problem.
   
8. Not being polite. "Please" and "thank you" will go a long way. They are so simple but always win points with the customer.

Making sure that your customers are taken care of should be your top priority. They are the reason you were, are, and will be in business.

Brad Harmon is the President at a leading financing company, First Star Capital (www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Your Target Audience

When starting a new ad campaigns, product line, or even a different approach, it is vital to know your audience. Each target audience is different. Each group has different likes, dislikes, hobbies, etc. BMW's audience is far different than Walmart's, and both are targeted differently. To best appeal to your customers you must take the time to assess your target audience. Ask yourself these questions:

• What is the target audience's gender?
• What is their age range? Are you trying to appeal to teenagers who like bright, edgy products or middle-aged adults who lean towards neutral colors and solid products?
• What is their level of education?
• What is their yearly income? (Take time to compare how high-end products differ from consumer products. For instance, compare Nordstroms to JC Penny's.)
• What are the target audience's hobbies? Do they prefer golfing or bowling? Do they prefer television or reading novels?
• Are they single or married? Are they parents? Grandparents?
• What qualities are important to them? Do they prefer prestige, quality, or an inexpensive price?
• Why will they like your product? What does your company have to offer?
• If you want to go even farther, compile a bio of individual people that make up the targeted audience. You can even include their photo.

When you complete your assessment, you will have a stronger foundation for your project.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Protect Your Computer

Online threats are becoming more and more sophisticated. Spammers use pop culture and recent events, like the election or the Olympics, to lure the viewer to click on links infested with malware and viruses. You must be very careful with links you click and sites you go to.

Here are some tips about how to protect your computer from such threats:

• Don't click on pop-up messages. Sometimes they say you need anti-virus software to protect your computer, but instead give you a virus.
• To counteract the scenario above, be sure you have a trusted anti-virus software already installed in your computer. You will have no need to click on the link.
• Be very careful when opening any email attachment. Try to find an email provider that scans the attachments before you open them.
• Be very careful with clicking on links in an email. A email from "PayPal" requiring you to sign in may indeed be a scammer trying to steal your PayPal account information. Be sure to login in on any website's official home page.
• Avoid emails from people you don't know or that have odd email addresses/messages.
• Regularly run spyware scans.
• Regularly up-date your software and patches.
• Routinely back-up your files onto an external hard drive or USB drive.
  

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Your Elevator Pitch

Do you have an elevator pitcher? An elevator pitch is a means of convincing the person you speak to, mainly your investors, networks, and prospects, of your business potential in 60 seconds or less. Basically, can you tell the overview and goals of your business in 150 words or less, in one elevator ride?

Why do you need an elevator pitch, you ask? It helps you, firstly, figure out the true goal or your business. It answers questions such as “Who are you?” “What is your product/service?” “Why does your product/service do for the buyer and what are the benefits?”

Many times investors and venture capitalists are too busy to look through an 80-page business plan. They want to know who you are and what you do in literally one minute.

Firstly, figure out what is your goal for your business? What is unique about what you do? Why are you a cut above the rest?

Be sure to make it exciting and keep it simple. Show your passion for what you do. But keep it clear, concise, and memorable.

If you formulate a strong elevator pitch, you will be prepared to “wow” any investor.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Your Business Plan

Your business is born through your business plan. Make sure that it is as thorough as it can be. The more detailed you can get, the more grounded you will be.

We did a search to find great business plan websites and tools. Here are our results:

• US Small Business Administration – This site is full with articles, resources, and tools. SBA offers many services in addition to help businesses with all types of needs. www.sba.gov
• SCORE – SCORE offers many tools for the business owner. They offer templates for business plans as well as free business mentoring. www.score.org/template_gallery.html
• My Own Business – Non-profit site that offers a business course with 14 lessons on basics to starting your own business. www.myownbusiness.org
• BPlans.com – This is a simple website that offers many business plan examples, articles, tools, and software. www.bplans.com
• Entrepreneur – Offers many articles on how to write a solid business plan. www.entrepreneur.com/businessplan/

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Do You Have A Borrowing Checklist? - Part 2

Last month we shared 5 items that will make the borrowing approval process quicker and easier. This month we have some more items to add to that list. You may be already on top of these items, in which case- outstanding! If not, hopefully this will be a useful business guide

Most leases under $75K only require a one-page credit application but often times other issues come up or the equipment you’d like to lease is a higher amount. Knowing pertinent company information or having it easily accessible will save you precious time and let you get back to focusing on what you do best!

Sam Thacker from Allbusiness.com has put together a borrowing checklist. Here are a few more important items that we often trip across at First Star:

1. "Know several important statistical characteristics of your business. Here is a partial list of information that management should always know about their company through the last interim financial statement:
   a) Year to date gross sales
   b) Year to date gross and net profit
   c) Current accounts receivable balance
   d) Current accounts payable balance
   f) Projected annual sales for the current year.

2. Know what lenders / trade vendors have filed financing statements. (UCC’s) against the business. Have copies of them and understand what collateral is secured. Knowing in advance who has a blanket lien on the company is very useful, particularly if you’ve already paid for some or all of the equipment.

3. Keep a one page, smartly worded, easy to understand description of your business. This is particularly important if your business is complex and unique.

4. Write a quick and easy to understand description of the equipment you are looking to acquire and how it fits into your operations. Just like your business may be complex and unique- so too with the equipment. Briefly explaining what the equipment is and how it fits into your operations can help speed up the approval process.

5. If your leasing request is higher than $75K (or in some instances $100K), you’ll need to provide the last 2-3 years of completed business tax returns and financial statements. "

Don’t be overwhelmed. You won’t be asked for all of these items- you may not be asked for any of them. But staying on top of such items will not only help you when it comes time to acquire some new equipment, it just makes good business sense. Our goal at First Star is to help your company grow and succeed. Being a well-informed borrower is key to your success.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

How to Spur Sales Using Triggers

Triggers are psychological techniques that are designed to motivate and inspire your prospects to buy the product you are selling. Kevin Wilke, co-founder of Nitro Marketing notes that "There are at least 30 different triggers you can use to make your prospects agree to practically anything you propose. They all include a ‘psychological code' that activates a person's buying sequence. For example, some of these psychological triggers include mental engagement, using patterns and ‘linking.'"

Triggers are not as complex as they might at first appear. Their goal is to allow you to tap into your prospects' desires, and use that knowledge to craft an irresistible offer, presenting your product or service in a way that is most appealing to them. "People make all decisions based on emotions, and then justify it with logic," Wilke says. “This is especially true when it comes to making a purchase."

Wilke offers the following examples of trigger tactics:

• Linking —"Linking presents your product by linking it to something the consumer can relate to," he observes. "Humans naturally store experiences and knowledge, and then recall those experiences by linking them to something new. A good example of linking is the marketing that was originally used to sell smoke detectors. Smoke detectors were ‘linked' to a person's nose. The ad copy described smoke detectors as a ‘nose on the ceiling' that ‘sniffed' the air for smoke."
• Storytelling — This is a good way to attract attention and engage an audience. Using a story that's interesting, and that includes one or more of these triggers can be extremely powerful in selling your product.
• Harmonize — It's possible to "harmonize" your product and marketing with what's already working. "Realize that you must first go with the established way of doing things in order to accomplish your goals and pattern yourself with what's already effective," says Wilke. "This will allow you to employ psychological triggers that already work without you having to figure them out. By modeling the competitors in your market, you remove a lot of the research and guesswork. You can study their work to figure out all the triggers they use, and why they work so effectively."

For triggers to work, it's vital that you study your prospects, their wants, desires and ways of thinking, advises Wilke. "Even the language that they use when talking about your topic is important," he adds. "Using their exact language in your sales copy and within your psychological triggers will have a huge impact in your sales. Look at other marketers that are selling a similar product effectively, and see how they're using triggers effectively."

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

How to Answer the Phone

How you answer the phone will tell the caller many things about your company. It is always more than just lifting the phone to your ear and saying a simple “Hello?” There are many things you can do to win and lose business just by answering the phone.

Be sure to pick up the phone before the third ring. Picking up after the first ring is even better.

When you answer, have a warm and enthusiastic tone in your voice. This one phone call may be the only impression the caller will get of your company. Make sure that it is a good impression.

Be sure to identify yourself and your company. No caller should ever have to ask if they have reached your business.

Always ask if it is alright with the caller if they can be put on hold. Once they are on hold, don’t forget about them. Check in with them every 30 seconds to see if they are fine being on hold or if they would rather call back later.

Just remember to always present your business professionally. Do not depend on meeting face-to-face with the customer to make the sale. Try to win their business just by how your answer their call.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Ways to Plan Ahead

With the economy continuing to appear uncertain, it is crucial to have a good business plan in place. Here are a few tips on how to plan ahead for any bump in the road:

• Have a marketing plan that takes into account an uncertain economy. “Go out and make more sales” is not a strong plan.
• Plan in detail on paper how to repay a loan or make lease payments for new equipment.
• Make sure your financials are correct – especially if you do your own accounting. This will always save you time and money.
• Have a plan for any emergency. What do you do in the case of a flood, earthquake, fire, etc? Definitely answer this question in regards to the safety of you and your employees.

When you plan ahead, you are ready for any problem you may face.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Business Blogging

Businesses are always trying to grow the best they can, especially on the ever expanding Internet. One way to get your business more attention, to grow your “links back” to your website, and to keep you customers coming back for more is to frequently post blogs. Here are a few tips when you blog for your business:

Be sure to be original when you post your blogs. Other than obvious copyright infringements, people like to see new and original content.

Have a goal and stick to it. It may seem overwhelming to blog every day, or even a few times per week. Try to blog on schedule because it shows your viewers you are both consistent and reliable – something every customer wants to see.

Always have a link to your website at the end of end blog. No one hates free advertising. It also helps search engines like Google and Yahoo to see that there are other sites linking to your website which in turn increase your standing on the search results.

Blogging is easy and extremely rewarding for your business. Whether you are a biodiesel equipment company just getting into the Internet or a graphic design studio with years of experience, blogging will help your business to grow.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Good Questions to Ask Yourself

It is always good, as a small business owner, to review your goals and plans - especially when buying new equipment. Without a solid business plan, many businesses could be wasteful in their investments. Ask yourself these questions while looking into your new equipment acquisition:

• Why is the equipment needed?
• What benefits will it bring to your business?
• What are the actual savings of the equipment if it’s goal is to reduce operating costs?
• Is the new equipment to replace outdated equipment or to help you enter a new market?
• If it is to help you enter a new market, how do you plan to penetrate it?

Always thinking and planning ahead will help your business to be a step above the rest.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

The Last Quarter

Although it's only September, the end of the year is fast approaching! Before we realize it, it's going to be the end of the year and if you're like me you will be scrambling for last minute holiday gifts. The good news is that the 4th quarter of the year is probably the best time of year for buying any new equipment for your business.

The last quarter of the year often offers lower rates because lenders are calendar year tax payers and they are also striving to meet or exceed their year-end numbers. In addition to lower rates, they often tend to be a bit more flexible with their criteria. This is to your advantage so why put off that purchase any longer?

Also, start talking to your accountant about year-end tax planning. The goal here is to increase expenses and delay income. You can secure an entire year's worth of tax write-offs in only a couple of months. Buy any needed equipment now before the new year. Expensing equipment cuts your adjusted gross income, lowering your tax liability

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Do You Have A Borrowing Checklist?

Part of keeping your business agile and ready for ever-changing opportunities in today's marketplace is to keep your borrowing information up to date. For most leases under $75K, a one-page credit application and possibly recent bank statements are all that we require. However if you are looking for a higher dollar amount or a special circumstance arises, more information is often needed. To save time, frustration, and possible declines take a few steps each year to keep updated info on hand.

Sam Thacker from Allbusiness.com has put together a borrowing checklist. A few of the most important items that we trip across at First Star are listed below:

1. "Make sure all shareholders who own more than 20% of the company knows what their credit scores are. A shareholder should be fully informed about any negative characteristics of their report and be prepared to proactively explain them. If a principal finds any discrepancies, they should be handled
expeditiously. Negative entries on a credit report that are explained honestly will have less impact than if the lender finds them and must ask about them.

2. Keep accurate and up to date business organization records available in one place. For a sole proprietorship, this would be any business license and assumed name certificate. A corporation should keep original and copies of a)articles of incorporation b) certificate of incorporation, c) corporate bylaws (up to date), corporate minutes, and copies of all corporate resolutions. The operating agreement is often requested if you are an LLC. There are similar documents for partnerships.

3. Keep good accounting records. Lenders are often more concerned about the accuracy of the records then the actual information presented. Keep a set of interim financial statements for each month end or quarter and keep a set of end of year statements for the last three years.

4. Have all shareholders who own more than 20% of the company keep a personal financial statement up to date. Generic forms or forms from nearly any bank are often acceptable. Generally a personal financial statement that is less than one year old is acceptable as long as it has not materially changed.

5. Management should keep easy to find proof that all necessary taxes and governmental reports have been filed and that the company is in good standing."

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

FAQs: Equipment Leasing

If you are researching equipment finance companies or equipment leasing in general chances are you have several questions and would like a great resource to assist in your decision making.

How long does the process take?

With most transactions that are under $100K the prequalification process is completed within 1 - 2 business days. We will then issue the final documentation and when the equipment is delivered we are ready to pay the supplier. In most cases the financing only takes a few days. The longest lead time is typically associated with the equipment availability.

What factors are used to determine credit worthiness of the business?

The length of time in business, references from bank and trades, Dunn & Bradstreet and credit bureau ratings.

How is a lease structured?

A lease is flexible and can be tailored to your business needs. Lease terms typically range from two to seven years. Payment schedules can be fixed or timed to fit your needs. The most common is equal monthly payments.

What are the tax advantages of leasing?

In some instances the monthly lease payment is treated as an operating expense and creates a "line item deduction" against revenue. In other instances the equipment is depreciated and written off over the useful life of the asset. Because every business is unique, we encourage you to seek out a qualified accountant to assist with the specific situation regarding your business or organization.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Paydex Scores

Good credit is the lifeline of your business and knowing your Paydex score may be one of the most important aspects. Your company’s score is the key to obtaining financing, setting lease payments, creating payment terms with suppliers, and even determining insurance premiums.

Paydex is a business scoring model developed by the financial reporting company, Dun and Bradstreet (D&B). The Paydex score is a dollar weighted average of how a company has paid its bills over the past year, based on the vendors that report to D&B. Simply put, Paydex scoring looks at one thing: whether a business makes payments on time and meets creditors’ payment terms.

It is important to keep in mind that while your Paydex score is crucial, lenders will often pull and weigh personal credit for the company’s principals as well.

It’s not impossible to attain business financing without a Paydex score, but the process won’t be as automated so it will take longer. It often entails the potential creditor calling listed credit references and waiting for their replies.

Paydex scores range from 1 to 100. A high Paydex score (much like a high FICO score) means a lower risk. Most lenders want to see that a company’s Paydex score is at least 65 - 70. Low Paydex scores will almost always lead to limited access to business credit as well as significantly higher interest rates.

A score of 100 represents a business that pays their bills prior to the invoices being sent. Businesses with a score of 80 are those that pay their bills precisely on time. To increase your score beyond 80, you must pay your bills ahead of time. Businesses must be vigilant in making payments to vendors and creditors within the terms of payment. However, keep in mind that you only receive ratings from those vendors that report to D&B.

The table below helps to illustrate the scores:

Paydex Score - Payment
100 - Anticipated early
90 - Payment within discount period
80 - Prompt Payment
70 - Payment if 14 days beyond terms
60 - Payment is 21 days beyond terms
50 - Payment is 30 days beyond terms
40 - Payment is 60 days beyond terms
30 - Payment is 90 days beyond terms
20 - Payment is 120 days beyond terms
UN - Unavailable

As with your personal credit, it is important to monitor your business’ score to watch for errors and avoid sloppy reporting by vendors. To check your Paydex score or for more information: visit the D&B website at www.dnb.com/us or contact them by phone at (877) 753-1444.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Focus on Innovation

Change is a part of any business. But there’s a difference between change and innovation. Innovation is what separates you from the competition. Simply put, most companies fail at continuous innovation. Ultimately, that failure puts many companies out of business. The key is to understand how incremental innovation- as opposed to huge change- can benefit your company.

Innovation doesn’t have to be ground-breaking- in fact, for most businesses, trying to achieve big innovation can be destructive. But consistent, ongoing innovation can change your business for the better.

While we tend to think in terms of radical when we discuss innovation, it doesn’t need to be. It can simply be an incremental innovation extending a product you already offer, like a new color M&M or expanding the capacity of an MP3 player. Or it could be focusing inwardly on changes that help you take out costs or perform tasks more quickly or less expensively. It can be an adaptive innovation like making your company easier to do business with, like making it easier to shop with your company online.

Remember, as a small business owner- you can’t be good at everything. Focusing innovation efforts into the areas in which you have skills is likely the most benefit. Figure out what your organization is good at and focus on the things that create value for others- find the sweet spot where others aren’t playing yet. There are many different strategies for how you innovate to handle the things that don’t fall into the sweet spot; outsource, get rid of low-value things or even learn to improve on your abilities in a given area.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Grow in a Shrinking Economy

It seems like every night the news is reporting more sour news about the economy. No doubt that our economy is on shaky ground lately but that doesn’t have to be worrisome news for you and your company. There are some things you can do in order to protect your business during an economic slowdown.

• Cut costs cautiously. As soon as the economy starts slowing down, many business owners think they must cut costs. But this is a short-term solution. Only cut costs or decrease your prices if it won't harm your business later. You can always lower your price - but you can't always raise your price.
• Advertise, Advertise, & Advertise! During the last recession, McDonald's almost tripled their advertising campaign at a time when their competitors, namely Burger King, were cutting back. So even though this may seem counter-intuitive, a recession may be the time to increase your marketing. Hard economic time’s weeds out your competition, leaving the field wide open for you.
• Revamp your marketing tools. For those marketing techniques that are working for you, this might be the time to revamp your marketing tools. Could your sales people use more training to close the deal? Online training cuts costs and time.
• Automate wherever you can. Find ways to automate any tasks to reduce the workload on yourself and your staff. What have you been doing manually that a computer system can do for you? Take a look at all your daily tasks and see if there is a computer solution to these time-wasters.

If your company is in need of new equipment, look at leasing as an alternative to paying cash or using up the bank line of credit. Preserve your cash for marketing and other day to day needs while still getting the equipment you need to further increase your sales and efficiencies.
Above all, stay positive. There is always of opportunity out there. While some markets might slow down others will be growing.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

You Are What You Think

Why think positively? All of our feelings, beliefs and knowledge are based on our internal thoughts, both conscious and subconscious. We are in control whether we know it or not. This affects our lives at work and at home. You'll only be as successful as you think you can be. We are constantly having inner conversations with ourselves, whether we realize it or not. Is what you are saying to yourself helping you or hindering you?

There are three C's that we should be saying to ourselves:

Commitment: Make a commitment to yourself, to learning, work, family, friends, and other worthwhile causes. Be enthusiastic. Dream of success!

Control: Keep your mind focused on important things. Set goals and priorities and develop strategies for dealing with your problems. Learn to relax. Enjoy success.

Challenge: Be courageous; change and improve every day. Try new things. Consider several options. Ask lots of questions. Be optimistic.

Studies show that people with these characteristics are winners in good times and survivors in hard times. Business will always fluctuate and there will be times when sales may be less than desirable, but our attitudes make all the difference in the world.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Tossing Out that Old Credit Application? Wait!

All businesses have occasion to discard confidential data. Customer lists, price lists, sales statistics, drafts of bids and correspondence, and even memos, contain information about business activity which would interest any competitor. Every business is also entrusted with information that must be kept private. Employees and customers have the legal right to have this data protected.

Without the proper safeguards, information can end up in the dumpster or recycling bin where it is readily, and legally, available to anybody. The trash is considered by business espionage professionals as the single most available source of competitive and private information from the average business. Any establishment that discards private and proprietary data without the benefit of destruction, exposes itself to the risk of criminal and civil prosecution, as well as the costly loss of business.

Protect your business and your customers by properly shredding and discarding sensitive information. Also, store needed documents that have personal information in locked, secure areas. Feeling overwhelmed? Your local listings can provide you with companies in the business of shredding and storing old documents.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Collateral Tips

It is an all too common practice that entrepreneurs put forth every possible dollar towards building their business, often at the expense of other personal finances. In this industry, it is not unusual to see small business owners taking out home equity loans in order to have funds for new machines and other equipment. But what happens in the event of an unforeseen drop in business?

If you own your own home and need to borrow money for your business, a home equity loan may be an option. As with any loan, there are risks, but home equity loans are unique in that if you default on your loan, you may lose both your home and your business.

If your company is in need of new equipment, leasing offers an alternative to personal loans. Instead of your entire house being used as collateral, it is simply the specific equipment that is being leased or financed. No one likes to think about his or her own business being in trouble, but the reality is that forces outside of our control can negatively impact our businesses. It's wise to be prepared and protect your family. Explore all the options that are right for you and your company's situation.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Your Best Customers

Who is the best customer for you? Knowing the characteristics of a good customer for your particular company versus a bad one will benefit your business tremendously.

Generating a description of the ideal customer will help you to seek out more of the same while weeding out the least profitable ones. The following exercise will help you get started.
Start out by listing your five best customers. Next to each, describe as many characteristics and identify as many demographics as possible. Helpful characteristics might be: how do they operate; how do they think; how big is their company; what level of financial success are they having; do they have multiple locations; how did they become your customer? Key demographics to identify would be time in business, number of employees, annual revenue, credit profile, and geographic location.

Next, do the same for your five worst customers. These are those customers who are the most difficult to work with, hardest to please, and generate the least profitablity compared to how much time and effort is required to service them.

Once this is complete, compare your best customers to the worst and identify the distinguishing characteristics and demographics. Then ask yourself what prospecting methods could be employed to find more of these best customers and avoid the worst customers? By profiling your best clients it becomes much easier to identify and target additional desirable prospects for your company. Good quantified prospects have a higher likelihood of turning into good customers.

Don't have enough time in the day to do this? There are companies that will do all the work for you, assuming that the majority of your customers are other businesses. Most of the big data sources such as InfoUSA or D&B offer a profiling service. They are very easy to use- you simply provide a list of your best customers (just the name and address of the company-no sensitive data required) and they will generate a demographic profile of each of these companies. They can then take this "best customer profile" and query the entire database of businesses (currently there are between 13-14 million individual companies in the US) in order to identify how many other companies fit the profile. You can then purchase this data for your prospecting efforts or even narrow it down further before purchasing (say you are only interested in those companies that are in your state, etc.).

If good customers start with good prospects, then good prospects must come from good market research.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Get the Most Out of Advertising

This year, spend less on advertising and get the same or even better results! Here are a few ideas to get you started:

• Don't go too big. You may not need full page color print ads or animated online advertising. Try two-color or black and white print advertising and test your response rate. There is some indication that people will pay more attention to ads with less color because it is out of the norm.
  
• Wait until the last minute to place your ad order. The advertising salespeople will be more inclined to drop prices in order to meet their quotas.
  
• For print advertising, demand that you get the right-hand page in the front of the publication. Studies show this area can generate twice the results as a left-hand page towards the back.
  
• Avoid advertising in places dominated by your competitors. If you are competing against similar companies, you will inherently attract a lower percentage of potential customers.
  

Following these simple tactics can help decrease your advertising spending while maintaining or increasing your marketing results.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Protect Your Identity

As a business owner, it is vital to know what's on your credit report so you can prevent errors that can inadvertently harm your company. One of the biggest threats out there today is identity theft. The ability to grow a business through help from lending institutions depends heavily on the credit profiles of the owners. Protecting your identity from thieves is crucial.People whose identities have been stolen can spend months or years and thousands of dollars cleaning up the mess the thieves have made of a good name and credit record. In the meantime, victims of identity theft may lose job opportunities, be refused loans for education, business, housing, or cars, and even get arrested for crimes they didn't commit. Humiliation, anger, and frustration are among the feelings victims experience as they navigate the process of rescuing their identity.

The US Federal Trade Commission recommends taking these precautions to avoid identity theft:

• Shred documents and paperwork that contain personal information before you discard them
• Don't give out personal information unless you know who you are dealing with
• Use firewalls, anti-spyware, and anti-virus software to protect your computers
• Don't use obvious passwords, like your birthday or mother's maiden name
• Be alert for discrepancies in your financial bills and statements and query them immediately
• Report fraud to the police as soon as you detect it and file a complaint with the FTC

If you have lost personal information or identification, place an initial fraud alert on your credit report with any (or all) of the three consumer reporting companies:

• Equifax: 1-800-525-6285; www.equifax.com; P.O. Box 740241, Atlanta, GA 30374- 0241
• Experian: 1-888-EXPERIAN (397-3742); http://www.firststarcapital.com/www.experian.com; P.O. Box 9532, Allen, TX 75013
• TransUnion: 1-800-680-7289; http://www.transunion.com/; Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92834-6790

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

The Possibilities with "One"

One is a tiny number. However, it can have a tremendous impact on your revenues. Here are some ideas to consider:

• Make one more cold call every day. One extra call per work day equals 260 calls in a year. Consider your current conversion ratio and think of the impact on your business.
• Suggest one additional item to every customer. This is particularly important if you sell lower-priced items or work in retail. Too many salespeople are focused only on getting the initial sale. However, almost everyone has additional items, products or services that could be beneficial to their customers.
• Invest one day per month developing your skills. Many successful people invest in themselves. They attend workshops and conferences, and participate in Web seminars and tele-seminars on a regular basis. Considering that the majority of people do not invest in developing their skills, you can quickly outpace your competition.
• Get to the office one hour early. Remember the expression "The early bird gets the worm." That one extra hour first thing in the morning can be the most productive time of the day. You have a better chance to reach decision makers, there are fewer distractions and you can often achieve more in that 60 minutes than in several hours.
• Suggest one more idea to help a customer improve his or her business. Offer solutions that do not include your products or services and your customers will begin to see you more as a partner than a supplier.
• Send one more thank you card or note. You can stand out in the crowd by sending handwritten notes to thank customers for their most recent order, meeting with you or sending an on-time payment.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

A Simple Way to Cut Expenses

The bottom line of running a successful business is to make all your dollars count. Cutting back unnecessary energy use keeps hard-earned money in your pocket. This is especially important now as we've seen states face critical energy shortages and blackouts. Even as the summer is drawing to an end and temperatures will start to cool off, reducing your company's unnecessary energy consumption is a simple way to cut costs even during the winter months.

Here are a few ideas, including some you can put to work in minutes at no cost to you to good energy saving investments when you are ready to replace equipment or do remodeling.

• Set the thermostat in your workspace to 78 degrees during work hours, and raise the setting to 85 degrees when the space is unoccupied. The energy savings can be significant - as much as 2 percent of your air conditioning costs for each one degree that you raise the thermostat.
• Many offices, stores or factories can easily reduce lighting without affecting productivity. Turn off as many unnecessary lights as possible. Use task lighting instead of overhead lighting, and light only those areas that are needed at the time. Providing the right lighting can save up to 15 percent on your lighting bill.
• Turn off your computers and any other office equipment when you're not using them, especially overnight and weekends. This practice costs nothing and can potentially save as much as $44 per year, per computer, depending on what you pay per kilowatt-hour. "Smart" power strips are being marketed that sense the presence or absence of office workers and turn the attached equipment on and off accordingly.
• Whenever possible, don't use large equipment during the peak hours of 3 p.m. to 7 p.m.
• Buy products that have the Energy Star label on them. All Energy Star products meet strict guidelines set by the US Department of Energy.

An energy audit might be the best investment you can make for your business. Many states are offering incentives for businesses to improve their energy efficiencies. Check with your state as to what kind of tax breaks or discounts for which your company may qualify.

Brad Harmon is the President at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Brad is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.