Soap Warehouse Blog

There are many articles, webinars and e-book kits out right now on how to use Pinterest to market and sell, but most are not for service business owners like pressure washers, they are for the retail business owners. In other words how to interest people in buying a product not a service.

So I will go over some basic information and tips on how you can use this fastest moving new social media to your benefit.

10 basic things to know about Pinterest and how it works.

1. You must be invited by a current Pinterest member to start a page. So if you do not already know someone you can't just go and start a page because you want to. So I am offering any Soap Warehouse patron a free in. Just call me with your e-mail and I will send you an invite, that simple, 1-800-762-7911. But for most of you just ask your wife she is probably already on it. Over 80% of Pinterest users are women, but don't let that bother you since women are the most likely the person who will call for pressure washing or at least put their husband up to calling.

2. Create your page in your business name, not your name. This separates you automatically to the viewer or visitor as a business and not just some guy that does this type of work on the side. For instance as of this printing there are only 5 "People" that have the words "Roof Cleaning" as part of their name. But only be that specific if one line of work is all you do. If not make separate boards for each type of work instead. And congratulations to AccuWash for being one of these five.

3. Once you post a new board it will be the first board seen on your page. Right now there is NO way to change this, so pre planning is key to how your page will be seen by new viewers. You can take the time to move an entire board back to the first position but it would take alot of work. You can not just repin a whole board like you can a single pin (discribed later). You will have to make a new board first and it can not have the same name as a board you already have. So if you want to use that same name you first have to go and change the currents boards name and then create the new board with the name you want.

4. You can change the titles of the boards that come standard with Pinterest and you many want to change all or at least some of them before you start adding new ones. Most computer screens will see the first 10 boards you post so best if you can keep everything you want to show case under or equal to that number. Or at least your business boards under that number. Have some fun boards also above the fold to hold and bring those new people to your listing. If all they see is boring business items they may click right back off you.

5. Once you pin to a board it also will keep shifting back or down as new items are added and there is nothing you can do about that either, other than repining, which I will discuss later on. And be sure once you have pinned something to open it back up by using the edit button and adding a link. This way you can direct people to where you found this item, to a page on your web site or to a landing page with a special offer or opportunity. Links can be vital.

6. As you pin to your boards it is also being pinned to the general main Pinterest page showing the most recent activity. So posting frequently keeps you in front of new people every time you post, who can then subscribe to one or more of your boards. Fun posts will draw them in and only having good content will keep them or have them follow one or all of your boards.

7. Make the most of the description section to exactly match what you are showing. That way the search will work the best for you.  For example if you list pressure washing or power washing in your description and then do a search for that you will get results with all the words, pressure and washing, which will give someone looking also a lot of laundry washing items as well. Adding more descriptions will shorten the list but may not help if the searcher does not think to use it. For example 'Roof cleaning' gives a good number of results. Switching it to 'cleaning roof' gives you the same results, Pinterest does not care what order they appear in the description just that the words do appear unless quotes are placed around them "Cleaning roof" then will only give one result while "roof cleaning" gives you back all those others. Add the word "pressure" and it will help by making more of the results of where you want to be. Also add the word "No" and it drops the number down to just a handful.

8. Make boards not just pins using key words. I could not believe that no one right now has a board named "Roof Cleaning" but AccuWash. The more interesting you make the pin post names the more likely it will be looked at. But don't be like Wnc Roof Cleaning, that is the name of their page but NONE of the 30 boards on that page have anything to do with the business. They are all fun boards. What a wasted opportuinty. The page has had some acitvity but no where can these visitors see who and what Wnc Roof Cleaning is!

9. Make Fun boards only about things you really care about and like, things that you think prospective customers care about and like as well. Do you have a passion for certain food, sport, activity. Or just make a board with a broad topic, places I have been, want to see, Bucket list items. These are the boards that will get people looking, liking and following you. Then maybe a few of them are in your area and will try your services. You can not expect to have all business boards and generate any type of traffic. And you want to only show things you really are interested in. Having a board on nails (the ones on your fingers) would not be a good choice but one on 30 minute or less meals or on grilling out could be.

10. Now I will mention the moving or repinning an item from low down on a board to place it back at the top. You will have to go first to the board the pin is now. Click to edit the board, then click to edit the pin you want to move. You can now repin this pin to the top of that board or add it to any other board. But if you do not want two of the same thing on one board you will then have to delete that pin that will still be in the lower position. This is also an easy way to run a promotion. Just change the offer and repin the photo and new offer to the top of the board you want. You might have a board just for Specials that can be always be first on your page.

I am not saying that Pinterest will bring you a ton of new business like a local Facebook or Google ad can from people who never knew you. But I am saying that having a Pinterest page will make you look like a more rounded and real person that others will want to do business with. And once you are a member of Pinterest, be sure to connect to as many of your current customers as possible. This way you can always be around them and noticed when they are on the site so they can easily think of you and refer you to their friends. And that is the best way to earn new business and it will almost be for free.

The most important part in making sure you can pay your monthly bills is your business's cash flow. It doesn't matter how much money you have billed out and are sitting on your books if it is not in you bank account it won't help you. Making sure you have the money available to pay your obligations in a timely manner can also save you money besides improving your credit and bottom line.

Here are steps you can take to managing your cash flow.

Use dedicated accounting software. It is not just necessary to have a computer but to have and use software designed especially for managing your money. I love QuickBooks and there is a program level for just about any kind of business out there, big to small, basic to advanced. There are plenty of them out there and I am sure you can find something in your price range. Remember using it will save you countless amounts of money and time.

Set up auto bill payments. This is very common these days but makes financial sense as well. If you set your self up a few different checking accounts to manage your resources. You could have one that just handles payroll, taxes and license fees. One that you use for all your fixed monthly bill expenses like your phone, rent, vehicle payments, electricity that don't or seldom vary month to month and then a third general funds account where everything funnels through. You can set up that each week, a few set days a month or just once a month that a set amount will be taken from the general fund to go into the two others to fund them for their automatic payments to be paid from. Try to have a two week or monthly surplus of cash in each. This way you can easily see when you are gaining a surplus of cash flow, that could be set aside in a savings account or when you are having a shortage where funds will be needed to be added from savings or by other means of credit. You will also not have to watch and worry about each separate payment date since they will come out when needed.

Have a Collection Policy. Not having one is like planning to throw money a way and not following one you have in place is like setting a match to it. Many of you do not extend credit to most of your customers. Pressure washing is typically a do the job get paid right then business. But those that do contract cleaning, large company fleet washing, building management work, etc. you are doing a job and then having to wait for the money to come in sometimes 30 to 60 days letter. Letting customers get away with not paying you can sometimes hurt you more than not having the work in the first place so don't let it happen. Make sure your collection policy is a part of every contract and press it's points when needed. As soon as you let some slip, "Oh but they give me so much business.", you will be having to slip your self to your vendors and putting your business credit at risk, not theirs.

Immediate Payment on Accounts Receivables. Have a system in place where customers can pay you as easily as possible. The time for waiting for the check in the mail is disappearing. Money transfers are becoming instantanious so why shouldn't you have that too. Rather than spending time and money chasing down late payments use methods to get your money faster. Find the best deal to accept credit card payments. Yes there are fees involved but figuring in that small percentage to the cost of your doing business will pay off. Most smart phones and iPads can now have point of sale scanners and applications to accept payments, companies like PayPal and Intuit have programs. Your own bank may have web access payment options you could use even with checks by taking photos of them to be automatically placed into your account. Instead of mailing out past due notices you can send e-mails that contain payment buttons in the e-mail. Put in your contracts that they must supply you with credit card information and that your bill will be drafted each month on a certain date, 30 days after work is completed or some other set way. State, add and collect on late fees. Once a company knows you will do what you said and charge more for late payments, you will become one of their vendors they are more apt to pay instead of let side when their money is tight, freeing up your cash flow.

Increase Prices. No one likes to think about having to increase their prices to their customers. But as a small business owner you have to know what it takes to keep your business running while still giving you a fair profit. The added costs for creating a cash flow system, like the computer, software, credit card processing costs, bank fees, web site, e-mail program etc. are all things that add to the basic price that you should include to your customers. But that is not to say that you can't give something back to those customers that help you with your cash flow in the form of discounts or incentives. For instance, say offering customers charge cards services run you 4% of revenue. Then increase all of your services by that same 4% and then give the cash customers 4% off their invoices and those that pay by check 2% off. Or what ever the electronic check transfer cost percentage is. This way you are not penalizing those customers and maybe others that may have thought about using a card will pay in cash instead. Want your contract customers to pay you faster? Then offer them NET 15 3% as an incentive.

Reduce expenses. Things can change rapidly, just look at the price of gasoline for instance. Your operating costs could vary widely month to month with out really changing anything you are doing day to day. For this reason you should be looking at your expenses at least once a quarter if not every 30-60 days to see where you can make improvements. Keep in close touch with your own vendors to be able to take advantage of sales, ask to be on mailing or e-mail sales lists, friend vendors that are on Facebook have twitter or foursquare accounts etc. they may send out announcements you would want to use. These are tough times and many companies are shopping for new customers and are giving sometimes big discounts to get them.

Choose your customers wisely. Especially contract or big time and cost customers. It does not do you any good to have bid and won a fleet wash contract if they are having financial issues of their own, don't have all the equipment at the location when they are suppose to, requiring revisits or extended time frames for your employees. Do your homework on them first by using D&B or other credit reporting companies that we discussed earlier in the first segment of these posts. Have it clearly stated in your contracts that services can and will be skipped or suspended if payment falls behind. There is no reason to keep working if you have little or no hope of seeing payment in the near future. Work like that can not only slow down but block your own cash flow by using up time you could have had for finding or doing other work that would bring in money.

Communicate with your vendors. We all know it is hard to be waiting on Peter to pay Paul, but letting the vendor, that is also waiting for payment, sit in silence is not the answer. And doing so can start to damage or ruin your business credit with them. Sometimes just a quick phone call or e-mail stating that you have not forgot them, that you know your invoice is due and letting them know when you expect your payment in order to make yours is all that is needed to keep a good relationship. As bad as you feel having to call the vendor, they feel just as bad not knowing and having to contact you for collection. Sometimes it is easier to ask for NET 60 with a slight penalty than losing your NET 30 status which will only tighten your cash flow in the future if you must begin to pay that vendor for supplies or services up front.

I apologize that this post got so long, there for I will postpone our Corporate Credit Do's and Don'ts until next time.

On the surface it would seem building good credit would be easy, just pay your bills, treat your customers fairly and you should not have any problems. But sometimes not doing anything can in fact hurt your credit rating. Passive credit building in not always the best way to approach having a good or great rating. Active credit building is a much better method and one you can control.

There are multiple ways to determine and increase a company's credit worthiness:

• Paying obligations on time
• Maintaining a positive and strong balance sheet
• Avoiding legal problems and bad press
• Establishing business credit separate from personal ones
• Gaining and sustaining a strong business identity

Potential lenders or vendors may look at one or more of these factors with different weight measures depending on their needs. A equipment vendor may just care that you have a history of making payments on time where as a bank lender may feel a positive P&L history is more important, and an insurance company care more that you have never had any past litigation or claims filed for a policy rating.

Ways you can actively try to build and improve your business credit and rating.

Open lines of credit. Do this only with the type of businesses you will use in your daily routine. It makes sense to gain NET 30 terms with supply vendors and credit lines or cards with national companies you will buy or use services from, such as Home Depot, Nations Rental, gas companies etc. but at the same time you do not need to open credit just to show you can.  You need to keep your debt to cash ratio under 50% and more in line with 30%. It may seem that it is fine to be a strictly pay in cash as you go but that will not help build your credit. If you already have the cash use credit even if you do not need it right now and use the cash to pay it off.

Pay off card balances and loans faster than scheduled. The easiest way to be able to borrow is to show you really can do without it. So paying down a debt faster indicates you have a good cash flow than just making the minimum by the due date or carrying a loan out to its term. Even making one extra payment every 3-4 months can cut almost a full year off of a 5 year, 60 month loan, saving you interest.

Ask for deserved credit increases. Most companies that you have a long term relationship with are more than willing to revisit and possibly increase your credit limit every 12-24 months. A good time to discuss this is when you first open the account and to ask what that companies policies are in regards to credit increases and if they will be automatic or if they should be asked for. Once you know then be sure you do not let those time lines pass too far before asking for the increases available to you. Be care though because some credit card companies will look unfavorably to customer requests that occur too frequently, thinking that you are asking in need and may become a higher risk.

Not missing payment or discount dates. Besides the normal pay by a certain date each month or by NET 30, many cards or companies have other dates you should look at to see if you can gain savings and credit worthiness. You many have NET 30 terms with a vendor that may also give a discounted prepayment date as well, such as NET 15 3%. Where if you pay in less than two weeks from the purchase you can get additional money off the sale. Or just because your credit card is due the 5th of each month that you always pay off in full you may be still paying interest on charges that were made in the first 9 to 11 days after the last closing date, because that company may start adding interest after 21 days. Every card varies to be sure you know what specific terms each one carries. So sometimes paying your cards off more than once a month using the card companies on line payment system may save you extra interest and looks good as well.

Here is a link to a good article that gives you more tips for personal and business credit.

https://fitsmallbusiness.com/ways-to-build-personal-credit/

Your credit is one of the most important backbones of your business. If you as a business owner, and the business it's self, do not have at least a good credit rating you will face problems and added expenses in your everyday business life.

Reasons you need to check and stay on top of your business credit report and ratings.

1. You need to have a positive credit rating separated from your personal credit.
2. Your business is being rated year by year, whether you realize it or not.
3. Not doing some things can harm your rating more than doing others.
4. Do not assume that your vendors, no matter how small, are not reporting information.

Credit reports are an integral part of modern business and the more and more technologically advanced we become, the easier it will be for unfavorable reporting to effect your business. The key if stopping it before it happens or at least to correct it as fast as possible if it occurs.

Dun & Bradstreet use to be the only player in the business credit reporting world but that has also been changing in the past 5-10 years. They use to report only for the very top Fortune 500 companies but these days they cover down to much smaller businesses as long as it has a physical business address, has a business listing (usually in the yellow pages) and has been around long enough to have vendors and lenders that report to them.

The three formally only person credit reporting companies like Equifax, Transunion and Experian have also moved into the arena; Equifax with their Small Business Enterprise and Experian with their Small Business Reports as well as companies like Credit.net a division of InfoUSAR, Accurint Business and ClientChecker for the mainly freelance professional and contractors.

Your first step is to find out what information they have on your business good or bad, review it and then make the needed steps to improve, correct or even add your business to their listings. Because just like with personal credit sometimes no credit is just as bad as bad credit when it comes time to needing it.

With some of these companies you will not be able to give them new information as to your credit worthiness, only a creditor that reports to them can, but you can find out what info they have and to address any mistakes just like with your personal credit.

Here are the contact links to see what they have for your own business. Just go to each, plug in your business info and see what comes up. If you find you are listed make sure the contact info is correct. But unless you have been denied credit in the past 60 days, unlike personal credit reporting, business reporters do not have to give you a free report once a year. There fore you may have to pay to get a copy of your report if you are listed. If you do not even come up then there is no reason to pay for a report. Most run in the $50 range for the detailed report. Some as low as around $10 for a limited report. Then others like Credit.net offers a free 72 hour trial that will allow you to look at yours and others for free. Accurint is a fee only for output not for the search, they are inexpensive and you only pay for what is actually found. So if you are not there, no charge.

Dun & Bradstreet www.smallbusiness.dnb.com/
Equifax www.equifax.com/small-business/home/en_sb/
Experian www.experian.com/small-business/services.jsp/
Transunion http://www.transunion.com/corporate/business/business.page
Credit.net www.credit.net/
Accurint www.accurintbusiness.com/
ClientChecker www.clientchecker.com

Next post I will discuss "How to build good business credit".

Everyone knows the way to build a business in through loyal customers, repeat business and referrals. But how do you know you will get these when you first work for a new customer? Here are eight ways to make it almost full proof.

1. Be a knowledgeable professional. Customers tend to trust contractors that are serious about the work they are doing. Demonstrate that you have a deep understanding about the industry and the special needs of the work entailed. This can be shown by certifications, being a member of organizations or associations that are linked to your particular job set.

2. Be yourself and personable. No one likes to feel they are being given a sales pitch from a used car salesman or manipulated into buying something they did not want. So instead of talking like a salesman, simply speak to them like a friend or colleague by just stating facts, letting them guide the conversation and make the final decisions with you only supplying suggestions and answering questions.

3. Be curious about the customer and value the relationship. People are drawn to and remember others who show true interest in them. Notice things that can become points of the conversation. Make notes of the points discussed to include next time, a crucial element of relationship building. You both must believe that you honestly have something of value to offer, to the customer and the business relationship.

4. Be consistent. A customer must build trust that you are going to do what you say and can believe it will be the same over time. Once a customer can predict your behavior, they are more likely to trust you and recommend you to others. This is why it is so important to only say what you know you can deliver.

5. Seek and say the truth. Trust comes when the customer feels you are working in their best interest not yours. Make it a point to discover areas where you can give them what they want or could need but never be afraid to tell them when something is out of your normal scope of work and may be better performed by someone else.

6. Have a real dialog. As mentioned before every discussion should be a conversation, not a sales pitch or lecture. Spend at least half of the time listening to what they need, want and are expecting for the results. Make sure that most of the conversations are about the business at hand and not just mundane chit chat, about the weather, etc.

7. Keep an open mind. You may know absolutely that this customer needs what you can provide and the exact best way to do it, but the customer may think you may be self serving and close minded about other options it they have reservations with your methods. Be willing to concede that there is more than one way to skin a cat and if they can not be put at ease with education about your processes, be open in telling them that they may be happier with someone else doing the work for them. They could sense you may have their best interest at heart and proceed. But even if they don't it is better to have a 100% satisfied customer who will work for you, than a dissatisfied customer that was left feeling slighted hindering your future business.

8. Show integrity. Take a stand for your company, even when it may be unpopular with your customer, but you do not have to become adversarial. Make decisions based on what you know that is right and legal. Do not do something for a customer you know is not kosher. And as stated before, never say you will do something you can not deliver.

Trust is only one part of the business customer relationship, but once gained it will help to improve your business ten fold. You must of course also have a service the customer wants and needs and will want to ask you to perform again for them and others going forward.

A few weeks ago we are introducing our new line of 10 pound containers of powder products at the Pressure Washing Seminar held in Albany, NY.

These 10 pound containers have a re-sealable ratched lids which makes them easy to open and use only what is needed to be mixed at one time. Each container holds 10 pounds of powder and an 8 ounce measuring cup. The products that are going to be available so far are:

"So Safe" Wood Wash, a "Hard Surface Cleaner", a "Stripper" for paint and stain, a "Wood Brightener", a "Truck Wash" and a "Uniform Detergent".

These unique containers allow even normally hazardous products like stripper and sodium hydroxide truck wash to be listed as a DOT ORM-D (Other Regulated Material for Domestic transport) consumer commodity that ships just like a non hazardous item, thus saving the customer from higher Hazmat fees.

Even in these small amounts they are concentrated products. Each 10 pounds canbe mixed to make between 20-50 gallons of solution for cleaning. The Uniform Detergent can wash at least 80 loads of greasy dirty work clothes so clean you will want to use it all the time.

Most of these run $50 per unit, $40 for the uniform detergent, and for a limited time are being offered at $10 off each pail. Because of their low weight and non hazard shipping classification the cost to ship these in small quantities via UPS Ground average around $10 a unit as well.

For more information, to be sent individual data sheets or to order please call us at 1-800-762-7911. 

For the kitchen exhaust cleaning contractor almost any cleaner you would want to use on the market today will be based on one or the other of these chemicals, or be a combination of the two.

You need to understand their differences, pros and cons to be able to best choose a product to fit your needs.

Sodium Hydroxide (NaOH) and Potassium Hydroxide (KOH) are almost interchangeable. They are the most chemically similar of the hydroxides. They are both a white, strong alkaline, corrosive solid or powder. Sodium Hydroxide is more commonly known as lye or caustic soda where Potassium Hydroxide is known as potash.

Both are used to change fats into soap in a process called saponification. Even though their solubility in room temperature water are about the same, products made with potassium hydroxide exhibit a greater solubility especially as you increase the temperature of the water. Like all strong bases, the reaction of both Potassium Hydroxide and Sodium Hydroxide with water is strongly exothermic, in other words, they generate heat and give off hydrogen. But the reaction with Sodium Hydroxide is slightly more exothermic which can make up for other more positive factors that Potassium Hydroxide possess.

The biggest difference between them is in cost because of certain factors; such as their production process by electrolysis, where potassium chloride costs more than sodium chloride (table salt), in ton quantities potassium hydroxide is about three times more expensive than sodium hydroxide.¹

At the molecular level, potassium hydroxide is also slightly smaller than sodium hydroxide, therefore it can penetrate oil molecules faster than sodium hydroxide thus breaking the oils hold on surfaces quicker and since they are also more soluble can be rinsed away easier, especially when using hotter water or steam equipment.

If you are needing to clean a metal surface that is coated with a hard baked on oil  or grease, you would prefer to use a potassium hydroxide with a hot water rinse. Where as a coating of thicker or soft oil or grease could be cleaned by using a sodium hydroxide for less of a cost with lower temperature water required because of the better exothermic reaction.

Using a product which contains both chemicals is like getting the best of both, you will be get a lower in price product with a better exothermic reaction than with Potassium Hydroxide alone, but you will have a faster penetration and better rinsing product than if it just had Sodium Hydroxide.

¹http://www.ehow.com/facts_6150994_sodium-hydroxide-vs_-potassium-hydroxide.html

It was another great show this year in Louisville, KY. We again were a sponsor of Big Rig Networks MATS 2012 Sweepstakes.

Our first winner on Friday of 5 gallons of product was Keith Sermon from Louisville, KY who is a driver for Landstar.

Then on Saturday winning 5 gallons of truck wash was Chris Fowler of Jackson, MO.

We enjoyed being able to walk around and visit will all the freight companies at MATS there looking for drivers. We hope to better reach new Owner Operators through the companies they work for instead of exhibiting in a booth and trying to talk to drivers one on one.

MATS truck wash specials will still be available until April 30th, so call us if you would like to try a 5 gallon of one or more of our great truck wash products.

With this month being National Financial Wellness Month I asked a friend of mine Mr. Don Schwerzler for an article that addresses an issue that all small family business owners should hope to face, succession planning. Here is his article:

Succession Planning:
Who needs it? And when do you start?

 BY DON SCHWERZLER

Mercer Dye designs general aviation facilities such as hangars, industrial buildings, and some really good-looking airport terminals. He first began working with his father in the construction business in 1975. An art major in college, Mercer had already tried his hand as an artist for a couple of years before his wife “advised” him to get a real job. Mercer relented, but not so reluctantly, because he genuinely enjoyed working with his father. The two of them landed significant construction contracts with Delta Airlines and Hangar One, among others, and the business grew like crazy. Throughout the 80’s and early 90’s, father and son rode a wave of prosperity in general aviation, and in 1993, Mr. Dye retired and left the business to his son. Mercer changed the name of the business from Dye Construction to Dye Aviation Facilities to reflect his new focus on design and consulting. Today, he’s recognized as one of the best in the field.

If ever there was an example of a smooth and easy succession, the Dye story is it. The father establishes the business, brings his son in early and retires while he’s still active enough to pursue his passions. The son borrows on the father’s corporate relationships and track record to market his new direction – a new emphasis that suits his artistic bent and his personality. There are no other family members involved and the succession from one generation to the next was a walk in the park.

But then there are those other family businesses where the succession story better resembles walking through a minefield. When a business ages, and the number of family members in the business swells, succession issues will mount and threaten the well-being of the company if not addressed early enough. Consider the case of a 50-year-old manufacturing company in the southeastern U.S. The patriarch and founder of the business died when he was 78 and left control to his wife, who at 93 years old has outlived many of her children and even some of the grandchildren. She still has the largest office and the final decision. All around her in the corporate offices and out in the plant are thirty-plus children, grandchildren, cousins, nieces and nephews… all part of the business and all pretty sure that they deserve a piece of the pie. Succession issues in that company are a dominant part of conversation at every gathering – business and family. Lines of leadership are fuzzy and people outside the business – including clients – know there is trouble inside the business. You could easily say that succession planning in that company is long overdue.

Issues that arise around succession can get out of hand even when they are addressed early on, but much more so when they are left to sort themselves out for too long. Every family-owned business is different and succession planning is not a perfect science. There are many different dynamics and complexities to consider and there are no guarantees for making everyone happy. But successful succession planning is not an impossible task, and it doesn’t have to split families apart. There are advisors and counselors who can make sense of mayhem and guide companies through the process, no matter how large the family or how long they have waited to get started. But waiting too long to get started can most definitely exacerbate problems.

So when is the best time in the life of a company to begin the succession planning process? A good argument could be made for beginning on the day the company is incorporated. But that is rarely done, of course. In the early days of a business, owners pay most attention to growing the company and give little thought to succession. It’s just not on their radar screen. Typically, the first thoughts about succession occur when children reach their teens and consider or begin working at the company – or when the owner gives serious consideration to retirement.

Knowing exactly when to begin the succession planning process is perhaps a matter of instinctive timing, something that entrepreneurs are good at in other areas of the business. Timing is what usually makes an entrepreneur successful in the first place… knowing when to enter the market, when to build capacity, when to borrow, etc. Knowing when to seriously pursue development of a succession strategy is something entrepreneurs will intuitively know and feel at some point in the company’s growth.

A good case in point is a very successful cold storage and shipping company in Jacksonville, Florida. Paul and Julie Robbins are a husband-wife team who founded Caribbean Cold Storage in 1993. Both worked in different capacities in the shipping industry before they discovered a niche and began providing a full range of refrigerated shipping and materials handling services. Paul capitalized the business by selling his Harley-Davidson motorcycle for $10,000 and borrowing another $7,000 on a credit card. It was a risk, but the Robbins saw an opportunity and followed their instincts to quick success. Within eight years they were honored twice as Inc. Magazine’s No. 1 fastest-growing inner-city business.

During their first few years of meteoric growth, Paul and Julie were focused on the business without giving a lot of thought to succession. Julie’s sister and brother-in-law have been in the business for years but it wasn’t until Paul’s son by a previous marriage and Julie’s niece entered the business that Paul and Julie “felt a need” to pursue development of a succession strategy. The couple also has a son, Zachary, who is only eight but already considered a part of the long-term plan.

“Ultimately, we would like to set the stage for Zachary to come into the business,” Paul says. “But the younger ones are already coming up. Kelly (niece) and John (son) are both active and want to stay in the business. That’s what got us started thinking about succession. I’m very happy with where the business is today, but we have to plan our next stage of growth and succession planning is a big part of that.”

Both Paul and Julie have passions outside the business. They love to travel and play golf, and they enjoy being together because they are also best friends.

“It won’t be hard to let go at all,” Paul says without hesitation. “The first emotional curve you go through as an entrepreneur is that it is my baby, but you have to realize that you started the business so that eventually it would create wealth, a balanced life, and financial freedom. We have created a culture here but we have also created value. The company is operating at a level that I’m comfortable with. I see bigger and better things for it but I’m not the guy to take it to the next level.”

In other words, Paul Robbins feels the timing is right to begin sewing up a succession strategy. Like his other business instincts, this one seems to have all the ingredients for success. Without realizing it, he is meeting all the criteria that succession planners and counselors recommend. He did not wait until the last moment to develop a plan. He did not assume that the children will take over the business and has made certain they want to be there. He has not been secretive about the company’s future plans. He understands that succession planning is complicated and that the succession process is more important than the succession plan. He has brought in outside expertise to guide the family and the business through the process. And, he and Julie are giving a lot of thought to their retirement years.

It’s never too early to begin succession planning, but in most cases, an owner will know intuitively that it is time to kick it into high gear. It just feels like the right time to get started on that next stage of the company’s life and plan for the passing of the baton. In Paul Robbins’ case, he looks forward to stepping back from the primary operational role in the company and taking a more visionary role. That doesn’t mean he loses his entrepreneurial spirit; in fact, it has already opened the door for new ventures.

“I’m already involved in a start-up technology for our industry that will be as revolutionary as Microsoft was in computers,” Paul says. The technology, actually a gel material installed in the ceilings of refrigerated containers, enables shippers to maintain the temperature of cold or frozen cargo for five or six days without mechanical refrigeration. “We’re in the process of funding it and taking if from a virtual to an operating company. We received the patent on July 6 and we have a 5-year plan that is being circulated to investors.”

So who needs succession planning, and when should you get started? The answer, of course, is that every family business can use it and the sooner the better. Companies that wait until a catastrophic event (death of an owner, for example) forces change in leadership will find themselves operating in a disruptive environment, and that’s never good for business.

In the final analysis, like a lot of other decisions in family owned businesses, starting a succession planning process will probably be an intuitive, gut-level decision. And in most cases, that’s the way it should be.

I thank Don for his words and his cases that he brings to us in this post. This and other valuable information can be found on his web site http://www.family-business-experts.com.

Please check it out to learn more.

I know this week is bringing record cold temperatures, but for many so far this winter has been very mild and is causing some contractors that normally close up shop during the winter months to find their phones ringing off the hook with business.

A Minnesota contractor for example had to call to get an emergency supply of soap to him for a new job. He told me "It is unbelievable that we have zero snow on the ground and we have had only one good snow here that stayed more than 3 days since November." He also stated "I haven't had work in January for years." Minnesota is experienced its third driest autumn on record and possible drought conditions may develop in 2012 due to it, indicated by a NOAA report just released.

This warmer than normal, no large snow fall is also putting a damper on the contractors that switch in winter to other lines of work, like snow plowing, ice dam removal and other cold weather jobs. Most of the West and North East is having record low snow amounts while places not use to so much of the white stuff like Arizona and Texas were getting recording setting high levels. NOAA stated that during November only 4.4% of the country had snow on the ground vs. the normal >10%. The only area to have above normal levels in 2011 was a small area over the intermountain West.

Also that the North East had above normal temperatures with MA, RI and VT having their warmest autumn on record. This caused the normal to above average amount of precipitation to feel like a unending rain storm. A customer in Boston that I spoke with back in end of November said his business was down almost by half since September because they were not having enough clear days to do the work they had scheduled, not due to lack of work.

Let us know by your comments here or on our facebook page as to how the weather effected your final quarter of the year and what you think the Spring of 2012 will bring.