Selling ads in a tough economy
Dear Karen: I sell advertising to small businesses, but times are tough. Do you have any advice?
Answer: Value and time are all-important to entrepreneurs, particularly now. Keep your sales calls short and add extras, such as a free Web ad, to your package, said Jason Morrison, executive director of ad agency Capitol Media Solutions, based in Washington.
“Introduce examples of how your ads have helped other small companies,” Morrison said, “but don’t come in with a hard sell. Give entrepreneurs some valuable information about their industry, their target demographic and how they can reach them.”
Most important, allow the entrepreneur to talk and establish rapport by listening. “Oftentimes, they will talk themselves into a sale,” he said.
--
Offer salary that’s fair to both sides
Dear Karen: I heard that now is a great time to hire. How hard should I negotiate on salary?
Answer: It’s tempting to pick up new employees on the cheap when people are desperate for work. But you’d be wise to offer salaries that are fair to both sides, said David Weiman, a psychologist and management consultant in Philadelphia.
“Establish your upper limit and stick to it, but if an applicant needs a lot more and you negotiate below what they need, it can backfire later,” he said. Offering more than an applicant requests can buy tremendous loyalty, whereas paying too little may drive workers to take part-time jobs or run side businesses that take their focus and energy away from your business. They may also jump ship at a better offer.
Discussing salary early in the hiring process will keep you and the applicant from wasting time, Weiman said: “It’s frustrating for both sides when a job seems like a perfect fit but things fall apart at the end over salary.”
--
Calculate proper pay for yourself
Dear Karen: I’m torn between investing profit back into my company and paying myself. How do I balance it?
Answer: There are always ways to spend money on small companies. But you should compensate yourself fairly for your business contribution, said Jonathan Blitt, chief executive of Aztec Software, which produces software for small-business financial literacy.
“Too few entrepreneurs contemplate what they’re doing about their own savings when they’re tempted to purchase that new printer or iPhone for their company,” Blitt said. “But as income comes in, they should carve out a salary for themselves.”
He counsels clients to generate a personal profit statement in which they calculate how much time they are putting in, how efficiently they are working and how much value they are generating for their firms.
“Until they grasp the concept of personal efficiency, entrepreneurs have no idea how much money they are truly generating or losing with their companies,” he said.
--
Got a question about running or starting a small enterprise? E-mail it to inbox.business@ latimes.com or mail it to In Box, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012.
