Trans-Pacific Partnership (TPP): 5 Things Small Business Owners Should Know

Originally published on B2B.DnB.com

The Trans-Pacific Partnership (TPP) is a massive trade agreement that impacts over 40% of the world’s economy. It aims to boost trade between a dozen nations around the world, all of whom are committed to economic growth through free, open trade.

According to the Small Business Administration, TPP “unlocks opportunities for small and medium-sized businesses…by addressing trade barriers that are particularly difficult for small businesses to navigate.”

No matter what your business’s size or which industry you’re in, this agreement could have huge ramifications for your growth in the coming years.

TPP At A Glance

  • TPP is a trade agreement between 12 different countries, including the United States, Canada, Mexico, Chile, Peru, Australia, New Zealand, Japan, Malaysia, Vietnam, Singapore, and Brunei.
  • The deal was signed into agreement in 2015 and 2016, and is currently being ratified in each of the individual countries. The ratification process is expected to take another two years.
  • The purpose of the agreement is to foster free trade or liberal trade between all of the member nations. Some 18,000 different tariffs will be slashed or eliminated altogether, encouraging economic growth between and within each country.

So what does that have to do with your business?

Well, if you’re based in the United States and interested in selling your products or services to customers around the world, or if you sell B2B services to an organization with interests abroad, TPP is poised to make it easier than ever – and more profitable than ever – to do just that.

5 Important Facts About TPP

#1: It’s a pretty big deal

As a small business owner, hearing about an international trade agreement may not peak your interest, at least at first. But in this case, it should.

  • Over 800 million people call a TPP country home.
  • TPP countries will include almost twice as many people as the European Union.
  • TPP trade will generate some 40% of all the world’s trade.

Think of TPP as the Facebook of trade agreements – member nations come together to form a huge source of prospective customers and new markets for your business, as well as potential talent pools for new employees. Suddenly, you have access to business opportunities you never could have afforded to pursue in the past.

#2: Not all industries are impacted equally

While the goal of TPP is to benefit each of its member nations, not all industries within those nations are impacted by the agreement in the same way.

  • The auto industry will see a huge boost when big manufacturing countries like Japan can export cars to the U.S. more cheaply. At the same time, the U.S. will be able to export their cars to countries like Vietnam, which currently enforces tariffs of up to 70% on foreign imports.
  • Tech giants and startups will get a break thanks to some of the treaty’s provisions. Until now, companies like Google have faced heavy restrictions in markets outside the United States. These restrictions often involved setting up physical locations and real estate in the country they wanted to do business in. This agreement lifts that restriction, freeing the companies to operate 100% digitally and expand into the virtual markets of the other 12 countries.
  • S. food manufacturers and farmers should see up to 98% of all tariffs eliminated on food exports like rice, beef, soybeans, and seafood. Farmers will now be able to export their goods to countries like Canada and Japan, which have had high tariffs on meat.

As you can see, the number of tariffs eliminated is industry-dependent.

So what if you’re not in agriculture, automobiles, or tech? TPP may still benefit your small business by making it easier to break into international markets, partner with international vendors, and access international customers.

#3: TPP may increase labor competition

TPP may encourage the outsourcing of jobs to other TPP countries, the hiring of foreign workers, and the building of facilities on foreign soil.

This prospect may be alarming for employees who fear their jobs being outsourced, but labor competition is a win for any business owner. With the strong economic relationships developed through TPP, business owners from member countries may enjoy access to a growing talent pool that must compete for the best jobs and wages.

As a business owner, you’ll have more options than ever when choosing where to open your next location, where to scout and hire talent, where to build your next factory, or how to staff your marketing team.

#4: TPP is committed to digital commerce

Google, Uber, and other tech giants aren’t the only ones who stand to benefit from TPP. Small business owners, entrepreneurs, and anyone who does business online stands to gain from this agreement.

Under TPP, infoproducts such as eBooks, music downloads, software, and videos can now be sold to member countries without tariffs.  You no longer have to worry about complicated foreign tax laws or tariffs that change depending on your customer’s country. Instead, you can sell directly to the customer in the form of a digital download, without having to own real estate in their home country.

#5: TPP promises faster customs processes

Have you ever ordered a product from another country and had it shipped to your home country? If so, you know just how long it can take. The reason for the delay is often customs, where the product you ordered undergoes scrutiny and checks by border officials.

TPP streamlines the customs process, making it faster and more efficient to ship goods between member nations.

As a small business owner who sells products to other countries, this could have a huge impact on your bottom line. Customers will be able to get their products much more quickly than before, which will significantly improve the buyer experience, build brand loyalty, and boost your bottom line.

Conclusion

In the very near future, the Trans-Pacific Partnership will open a new era of trade between some of the most prosperous and emerging nations in the world. As a small business owner, you stand to benefit from this agreement by taking advantage of lowered taxes on exported goods and services to these countries.

If you currently do business abroad, the implementation of TPP should save you money. If you’ve been thinking of doing business abroad, now is the time to get started. By focusing your operational and marketing strategies on member nations of TPP, you’ll position your business to take advantage of the many lucrative opportunities this agreement has to offer.

Interested in taking advantage of lowered tariffs for your industry? Find out more about TPP here: https://www.dandb.com/supplier/small-business-may-be-getting-a-trade-boost/
 

References

  1. https://ustr.gov/sites/default/files/TPP-Benefits-for-US-Small-Business-Fact-Sheet.pdf
  2. http://www.bbc.com/news/business-32498715
  3. http://www.bbc.com/news/business-32498715
  4. http://www.bbc.com/news/business-32498715
  5. http://www.bbc.com/news/business-34451423
  6. https://ustr.gov/sites/default/files/TPP-Benefits-for-US-Small-Business-Fact-Sheet.pdf

 

How Going Green Can Win You Contracts, Clients, and Working Capital

Originally published on B2B.DnB.com

What if you could reduce your carbon footprint, make a positive impact in the world, and snag the attention of venture capitalists while you’re at it?

No, it’s not a dream come true. It’s one of the latest trends in supply chain economics.

IFC and Puma are leading the way with a groundbreaking partnership that gives their suppliers access to affordable working capital – and all for going green.

In this new program, the fees suppliers pay to borrow money depend on how they rank in areas like environmental impact, health and safety, and social standards.  The more sustainable they are, the lower the cost of the credit.

As a diverse supplier, you have an emerging opportunity to ‘greenify’ your products and services – and not only because it’s good for the planet. Going green has economic and business-building rewards as well.

Here’s how going green can improve your business’s reputation, win you new contracts, save you money on operating costs, and get you access to working capital.

Save money on-site

One of the most immediate benefits of going green is saving money. Hard costs like electricity, air conditioning, and lighting can cut into your small business budget and force you to spend precious dollars on the cost of building maintenance.

But when you work to improve the sustainability of your workspace, office, or building, you’ll be able to save hundreds, even thousands on operating costs and utilities throughout the year and long-term.

And since everyone loves saving money and saving the planet, your commitment to go green will only improve your reputation in the eyes of clients, customers, and competitors.

So, what kind of sustainable upgrades will save you the most?

Common green building upgrades include…

  • LED lighting
  • Low-flow and automatic sink faucets
  • Green hand dryers in restrooms
  • Paperless offices
  • Energy saving heating and cooling systems

Wait a second – aren’t energy-efficient upgrades expensive?

While the upfront cost can appear pricey at first glance, the money you’ll save over time promises an astonishing ROI – often within months of making the upgrades.

  • Ace Armature Motorshop, a motor service small business in Stockton, California, saw a 50% reduction in their energy bill after installing energy efficient lighting.
  • Four Points Sheraton saved some $22,000 in energy costs after installing efficient lighting and laundry in their hotels.

When you make energy efficient upgrades, you’ll be able to put the money you save back into your business. With it, you can streamline operations, expand into new markets, develop new products, and increase your overall marketing spend to win even more business.

Reduce operational costs

When you change the way you develop products and services, and opt for more sustainable production methods, your changes can have a ripple effect on your business’s bottom line.

Suddenly, you’re not just saving money on your electric bill or cooling costs. You’re seeing a measurable increase in profits thanks to the small commitments you’ve made to go green throughout your supply chains.

Depending on your industry, that might mean switching to a more sustainable vendor, buying more product in bulk, ending a joint venture with a decidedly non-green company, or streamlining production processes for efficiency.

For UPS, it meant adding hydraulic hybrid trucks to its fleet and cutting fuel costs by over 45%.

These types of changes have both an immediate and long-term effect: on your bottom line, on your reputation, and on the planet.

Enhance your reputation with prospective clients

Going green will reduce your carbon footprint at home, but it will also have a positive impact on supply chains and partners in your local, national, and international markets.

Likely you do business with many different vendors from many different places. When you decide to go green, you become a leader for your clients, customers, and partners. As you reduce operational costs and boost profits, more and more people will look to you for insight on how and why to go green. You’ll naturally emerge as a thought leader in your field, which in turn will enhance your reputation with prospective and current clients.

In this way, going green is an incredibly effective business strategy. Doing so improves your reputation, positions you as a thought leader, fosters relationships with other successful business owners, and opens doors to opportunities you may not have known existed.

In other words, if you’re in business to boost profits, realize your goals, and make an impact, green is definitely your color.

Get access to financial opportunities

Imagine what you could do with an extra $1 million for your small business? Do you know exactly how you’d spend it? I bet you do.

While there’s no shortage of funding available, the competition is fierce, especially for diverse suppliers. Going green gives you another opportunity to bypass the competition and get the capital you need to grow your business, your way.

Beside IFC and Puma, there are countless corporations and venture capitalists looking to invest in small, diverse, green businesses. Some of these businesses are obviously green, such as Sungevity, an Oakland-based solar energy company that won $72.5 million in venture capital in 2014.

But you don’t have to be in a green business to win brownie points for going green. Just look at Impossible Foods. This food manufacturer based in Redwood City creates meat and cheese products out of plant-based materials. In 2014, their ingenuity and sustainable supply chains earned them $75 million in venture capital from Google and others.

Next Steps

Going green is not just something huge corporations do to save money or give themselves a PR boost. As sustainability becomes more and more the rule than the exception, savvy diverse suppliers are doing whatever they can to jump on the green bandwagon before their competition.

If you don’t have the resources to install LED lighting at your office, or work with more sustainable vendors, don’t worry – there are still small, easy, affordable ways to greenify your business and attract the attention of clients and investors.

Instead of…You can…

Instead of Installing LED lighting throughout your office, you can purchase individual LED bulbs for lamps.

Instead of purchasing a new heating/cooling system, you can turn on AC or heat only when absolutely necessary.

Instead of firing all your vendors and hiring new green vendors, you can replace your most expensive vendor with a money-saving green vendor

Small changes can have a huge impact on your bottom line and your carbon footprint. As you begin to make changes, follow organizations like Puma and IFC who are championing small diverse businesses that go green. When the time it right, you’ll be poised to make the connections and get the capital you need – and all for doing your part in saving the planet.

Want to learn more about securing venture capital from organizations like IFC and Puma? Read about their new program here: http://www.supplychaindigital.com/procurement/4270/Puma-and-IFC-reward-suppliers-in-emerging-markets-for-environmental-and-social-performance
 

References

  1. http://energywise.co/energy-efficiency-costs-less/
  2. http://www.pge.com/en/b2b/purchasing/supplychainresponsibility/gogreen/index.page
  3. http://www.pge.com/en/b2b/purchasing/supplychainresponsibility/gogreen/index.page
  4. http://www.inc.com/jeremy-quittner/venture-capital-flows-to-sustainability-companies-and-earth-day.html
  5. http://www.inc.com/jeremy-quittner/venture-capital-flows-to-sustainability-companies-and-earth-day.html

How to Start Outsourcing Small Business Tasks in 5 Easy Steps

Originally published on B2B.DnB.com

In the small business world, outsourcing is the process of hiring contractors to manage areas of your business you would otherwise do yourself.

While the mainstream media tends to draw associations between outsourcing and job loss, outsourcing is actually one of the smartest business moves you can make as a small business owner. This is especially true if you regularly find yourself working longer hours than you’d like. You likely end up wearing too many hats throughout the day, and often waste your time on tasks that could easily be managed by someone else.

For many entrepreneurs, outsourcing marks a key shift in small business growth. It is a stretch to attempt to manage every aspect of your business on your own. Assigning tasks to qualified freelancers and contractors can become an essential aspect to operating your business.

Is Outsourcing Risky?

If you’re used to having your hands in every area of your business – from operations and marketing to accounting and payroll – outsourcing can feel a bit risky.

How do you know the work will get done correctly? What if the person you hire makes a mistake?

Is it not easier and cheaper to keep doing everything yourself? The answer, in short, is ‘absolutely not.’

In this article, you will learn why paying freelance contractors to do essential small business tasks is almost always more cost-effective than doing things yourself.

I’ll also reveal a simple 5-step process to get started with outsourcing, including how to find qualified freelancers you can trust to help your small business thrive.

4 Big Benefits of Outsourcing

The benefits of outsourcing can be substantial. Here are the top four ways outsourcing can be used to streamline small business operations and speed overall growth:

#1: More time to run your business

Whether you are B2B, B2C, a startup or a one-person show, there’s a reason you began this entrepreneurial journey. The reason: you have a passion and talent for what you do.

That might mean a passion for great wine or a talent for web design. It could be speaking, coaching, or writing books. Whatever it is, that passion forms the core of your business, and is likely how you prefer to spend your time – helping customers, working with clients, and sharing your unique value with the world.

But you can’t run a business on passion alone. You also need to prepare invoices, balance the books, create marketing campaigns, and complete all sorts of mundane tasks that seem to have little to do with your passion.

When you outsource these tasks, it frees up your time to focus on what you do best. When you’re able to pour more of your energy into the areas of your business you’re passionate about, instead of spending your time scanning receipts and doing data entry, your entire business will flourish.

How outsourcing can help make you money

Consider how much money you make per hour when you’re doing what you love. If you run a coaching business and you charge $250/hour, every hour you spend not coaching incurs a loss of $250. That means spending an hour doing your QuickBooks or fixing your website just cost you $250!

Now let’s say you decide to outsource those tasks to a qualified freelancer at $50/hour. Your time is then freed to take on a client for $250. After paying your freelancer, your profit is now $200.

So which would you rather do – miss out on $250 or make $200? With outsourcing, the choice is yours!

#2: Increased quality through expertise  

When you don’t outsource, you’re responsible for the success of every area of your business. I’m good at a lot of things, but I’m certainly not an expert at everything. I bet you’re the same as me.

Maybe you’re a whiz at accounting but really struggle with design. Maybe traditional marketing comes naturally to you, but you have no clue how to approach social media.

Whatever your weak spot, outsourcing to an expert ensures professional, high quality results across all areas of your operations. In other words, if you’re not a web designer but you design your site yourself just to save money, all you end up with is a subpar website.

Skimping to save money does your business a disservice because the quality of the work does not reflect the value you provide your customers.

How outsourcing can save you money

Outsourcing to experts in specialized areas like web design, marketing, SEO, and development can save you money as well.

Let’s use the same web design example from above. If you’re not a designer, it may take you hours to make one simple change to your website – a change that an expert designer could have completed in a few minutes!

Remember what your time is worth. Would you rather lose $500 spending two hours on a website tweak, or pay a professional designer $100 to do it for you? Spend your precious time doing what you do best, and leave the rest to the pros.

#3: Passive income

Outsourcing allows your business to keep booming, even when you’re miles from the office.

Without outsourcing, your business growth is limited by the number of hours in the day, and how much you personally can get done.

With outsourcing, your business continues to move forward in the hands of your capable freelancers. For instance, you could be relaxing at a barbeque while your Virtual Assistant is busy answering customer emails and fielding calls. Outsourcing helps your business generate revenue even when you step away, which is a sure sign of success.

#4: Projected success

Speaking of success, outsourcing is a great way to position your small business as an established entity – no matter how small you may be right now.

When you employ a team of professional freelancers, you’ve suddenly gone from one-person show to a bonafide organization. While they may be located remotely, you now have a team that will make your business appear even more established, trustworthy, and knowledgeable.

How to Get Started with Outsourcing in 5 Simple Steps

  1. Identify your goals

When you make the decision to start outsourcing, determine which aspects of your business needs the most support. What, specifically, would you like a freelance contractor to do? Common outsourced tasks include:

  • Web design and development
  • Social media management
  • Customer service
  • Data entry
  • Accounting and bookkeeping
  • Virtual Assistant (VA) services

Look for parts of your business that don’t necessarily need your personal touch, as well as areas where you lack expertise.

Be sure to specifically articulate what you want done by writing it down. Instead of “I need help with accounting,” write “I need someone to create and send invoices, email clients who have not paid me, and track employee hours in my accounting program.”

  1. Find the right freelancers

Websites like Upwork.com and Freelancer.com are great places to connect with skilled freelancers and niche experts. Once you know which tasks you need to outsource, you can search for freelancers with matching skills and connect with them online.

  1. Create a detailed job posting

After determining which tasks you’d like to outsource and finding a handful of qualified candidates, create a detailed job description and post it on the freelance website that looks most promising.

Be specific about the work you need done, your expectations for the freelancer, the project timeline, and your budget. If applicable, ask for work samples and recommendations.

  1. Hire multiple candidates

After reviewing submissions from various contractors, hire your top three choices to complete a sample task or project. Be sure to pay freelancers fairly for their time. This sample project will demonstrate the quality of their work. It will also give you insight into the contractor’s workflow. Observe their communication style, responsiveness, and professionalism.

At the end of the sample project, determine which freelancer best met your needs. If you weren’t thrilled with any of your choices, go back to step 3 and tweak your job description to better reflect your expectations.

If you found a great freelancer, consider hiring them for a minor project first. If that also goes well, you may want to hire them for ongoing work.

  1. Repeat the process

Repeat this process for every area of your business that can be outsourced.

As we can see, outsourcing is a powerful, cost-effective way to streamline operations, increase profits, and spend more time on the areas of your business you’re most passionate about.

When you’re able to focus on your passion, that positive energy infiltrates every area of your business. It’s this kind of passion and energy that positively impact your reputation and speed your business growth.

7 Ways Great Companies Keep Great Customers for Life

Originally published at Hoovers.com

Customer retention is the key to brand longevity, customer loyalty, and steady profit growth over the lifetime of your business.

When you’re able to attract and retain customers long-term, you can focus on providing better products and services to the customers you already have, instead of wasting endless dollars trying to attract new customers when your revenue is low.

Customer acquisition is expensive, so it’s no wonder smart small business owners are interested in developing long-term relationships with their customers.

It takes a solid business plan, a customer-centric marketing strategy, and the ability to transform mishaps into miracles to retain customers for life. When these three forces converge, customers don’t just notice; they tell their friends.

Customer Service is Not A Department It’s A Mindset

85% of customers believe that great customer service influences their buying decisions. [1]

But customer service is not a dedicated department that’s separate from the rest of your business. Instead, it’s a state of mind and attitude that’s incorporated into everything you do – from the way you find new customers to the way you delight them after they’ve made a purchase. [2]

If the way you treat your customers is so important, both in their minds and in yours, why did nearly 40% of marketers cite customer retention as one of their biggest problems in 2015? [3]

Small businesses are having a hard time attracting customers and retaining them because competition is so fierce.

Customers have more choices today when it comes to making a purchase. For example, if they are consuming content online, or consuming a steak in your restaurant, they practically have unlimited options for doing so.

As a small business owner, you not only have to strategically position yourself in the marketplace with a strong Unique Selling Proposition; you have to get your products and services in front of the right customers at the right time.

Once you have acquired a new customer, it’s much easier to keep them coming back. Ensure customer retention by applying these 7 secrets for every customer who supports your brand.

#1: Solve a real problem

You can’t retain customers that you don’t have.

How do you find customers and turn them into lifelong fans of your brand? You do so by solving problems that actually exist in the real world.

Take a good, hard look at your business plan and make sure it’s centered around solving problems, addressing pain points, or educating and entertaining prospects in ways that appeals to them.

Many entrepreneurs and small businesses fail because they launch an idea that they think is amazing (i.e. organic vegan gluten-free multivitamins for dogs!), instead of developing products and services that solve a real need for real customers (i.e. flea medicine for dogs).

Make sure your business model is based in reality so you can set yourself up for customer retention success.

#2: Practice inbound marketing

Shouting about your business through a megaphone is no longer an effective marketing strategy. Customers are inundated with information on an unprecedented scale. It is very possible that your outbound marketing tactics can fall on deaf ears.

However, when you create helpful content that answers your customers’ questions and solves their problems, you immediately stand out from the competition.

  • Instead of trying to immediately sell your prospects something, try to help them.
  • Find out what they need most as it relates to your business.
  • Create engaging content that answers questions and solves problems.

That could mean writing a blog post on how to deal with an ant problem, or publishing recommendations for a great local Ethiopian restaurant.

Inbound marketing is all about solving customer’s problems on their terms. This technique allows you to immediately start building trust, which is a key factor later when you’re looking to retain the customer you’ve acquired.

#3: Deliver massive amounts of value

If you want to retain customers for life, you have to offer them huge value at every stage of the buying process. Value isn’t just about getting a great deal on your product. Value is about exceeding customer expectations from their very first interaction with your company through the buying process and beyond.

If a customer finds you through your website, their experience on your site should be helpful, educational, inspiring, or entertaining. When they are astonished by your blog post or email newsletter it can attract and keep their attention. They may think, “If the free content is this great, their paid products must be amazing!”

Once they make a purchase, your job is just beginning. Find ways to exceed their expectations and provide unexpected amounts of value at every stage in the sales process.

#4: Don’t force customers through your funnel

Want to increase customer retention? Then avoid forcing your customer’s hand.

It is important to be visible, to be helpful, to be present, and to make sure they know how you can best serve them. But don’t try to pressure them into buying before they are ready.

Sure, you may get a few more sales in the short-term if you push people to purchase. But twisting a customer’s arm or nagging them to buy is no way to begin a long-term relationship. You are in this relationship for the long haul, right?

  • Court each customer to retain them long-term.
  • Think of the relationship like dating. You wouldn’t propose to someone on the first date, would you? So why attempt to convert a prospect into a customer when they’ve only just discovered your brand?
  • Let your sales funnel unfold naturally, and let the customer set the pace.

Patiently develop these three factors: know, like and trust. Once this is established, prospects will invest in your services at the appropriate time.

#5: Do whatever it takes to fix a mistake

The order didn’t ship. The soup came out cold. The reservation was lost. The paint color was wrong.

We all make mistakes.

When you fail to delight your customer, you have an incredible opportunity to earn a customer for life.

It may sound strange, but making a mistake can actually be more effective when it comes to building long-term customer loyalty. Customers are much more likely to remember negative experiences than positive ones, and they’re much more likely to share those negative experiences with friends and social networks. [4]

This means if you make a mistake, but fix it promptly and exceed the customer’s expectations, they are likely to tell others about the experience.

In the event of an error, correct the matter by:

  • Issuing the full refund
  • Investing in coupons and freebies
  • Giving free membership for a month, or
  • Doing whatever it takes to make your customer happy.

The cost of retaining that customer is far less than the cost of a new customer acquisition – especially if the unhappy customer damages your reputation online or in the community. This warrants a third mention: do WHATEVER IT TAKES to make your customer happy.

#6: Reward customer loyalty

Positive reinforcement is a staple of psychology because it works. Reward your customers for loyalty to your company in a way that shows you understand them, and observe as customer retention soars.

Instead of developing buy-one-get-one offers or a typical loyalty rewards program, ask your customers what kind of loyalty program they would value most.

  • Maybe they don’t care about earning points, but would love a ‘refer a friend’ program.
  • Maybe they will happily refer friends for free if it means VIP purchasing status on your most expensive products.
  • Maybe they’d love to provide input on new products that are currently in development.

Incorporate their feedback and ideas, and develop rewards that will improve the customer experience.

#7: Make regular customers your top priority

So often in small business, you’re focused on landing that new client, scoring the next account, or launching the new product.

With so much going on, and so much pressure to grow, it can be easy to neglect your loyal customers.

If you abandon your regular customers in favor of what’s new and exciting, you risk losing the stable core of your business. Customer retention is a sign of your overall business health. Regular and repeat customers should be treated like the VIPs they are.

  • Make sure existing customer outreach is built into your sales funnel and your marketing strategy.
  • Schedule routine follow-ups, phone calls, surveys, and giveaways for your repeat customers.
  • Automate email outreach when it’s been a while since a customer has made a purchase.

You don’t need to constantly acquire new customers in order to experience small business success. By focusing on quality over quantity, it’s possible to increase your customer retention rates and build an unstoppable small business with the most loyal customers in your industry.
 

References

[1] http://info.verint.com/LP=2418

[2] http://blog.hubspot.com/marketing/delight-customers-inbound-methodology-questions

[3] http://applications.teradata.com/DDM-Survey/welcome/.ashx

[4] http://www.sdl.com/ilp/cxc/rules-of-customer-experience.html

New, Now, Next: 5 Surprising Trends in the World of Corporate Supplier Diversity

APRIL IS ALWAYS one of my favorite months of the year.

The beginning of second quarter is the perfect time to take stock of your goals for the year, analyze what’s working and what’s not, and make any needed adjustments with plenty of time left in the year to reach your goals.

April is also deep enough into the year that it’s possible to identify the major trends that are starting to take shape –  trends that will define the future of corporate supplier diversity this year and beyond.

Trending conversations about supplier diversity in 2016 are focused on:

  • How corporations and organizations are choosing their suppliers, and
  • The specific qualities those suppliers must have in order to win contracts with key players in their industry

In the past, there has been a strong focus on experience and relationships; vendors sought suppliers who had a proven track record of established industry relationships and service.

While both areas are still important for diverse suppliers, we’re seeing a strong trend toward value-add, influence, business strategy, and flexibility, all of which have been impacting purchasing decisions in significant ways.

Here are 5 surprising trends that are influencing how corporations choose their diverse suppliers, and how you can capitalize on these trends to secure more business in 2016.

Trend #1: A focus on value

When prepping their RFPs, more and more corporations are focusing (and being told to focus) on value. [1] This means they are looking first and foremost at what value you can provide them as a diverse supplier.

Value can be interpreted in many different ways, but the bottom line is clear: how can you help your corporate client to:

  • Cut costs
  • Increase efficiency
  • Boost profits, and
  • Exceed their business goals

The value-add you provide should address at least one of these key areas.

Since more and more vendors are considering contractors in terms of the value they can provide the company, be sure to have value-focused talking points prepared for interviews and phone calls. You should also include value-focused statements in your proposals.

Remember, value isn’t just about saving the client money, and it’s not just about the service you provide your client.

If you manufacture t-shirts, the value isn’t in the t-shirts themselves; it’s in what the t-shirts provide, such as increased brand recognition, a feeling of exclusivity, the chance to rally behind a cause, and so on.

Your value-add should be unique and set you apart from other diverse suppliers. Skillfully articulate your unique value-add in a single sentence that differentiates you from the competition – especially competition who are also diverse suppliers.

Trend #2: Influence matters

So often as diverse suppliers, we think of corporations as the ones with all the influence. But in 2016, we’re seeing a growing trend toward influence on both sides of the fence. [2] You can no longer think of yourself as the “little guy” and your corporate client as the “big guy.” You too must demonstrate influence in your industry in order to beat the competition and win the contract.

So what do I mean by influence? What if you’re a microbusiness or focused on a small, local, niche market? Do you need to worry about having influence then?

Yes. You can still demonstrate your influence to corporations by framing your reach not in terms of how big it is, but in terms of how deep it runs.

Having a ‘deep reach’ with your customers means:

  • Having an active subscriber base who regularly opens and reads your emails
  • Having an engaged following on social media
  • Demonstrating positive reviews and customer testimonials on your website and other marketing materials

Influence doesn’t have to mean having a massive reach – remember, that’s why you’re partnering with a larger corporation in the first place. You don’t have to be huge, but you do have to be connected. Think about how you can quickly demonstrate your influence with your tribe in a way that makes a huge impact during the proposal process.

Trend #3: The end of the Division of Labor

Let’s say your small diverse business is a tailor shop, and you’ve submitted a proposal to create the suits for a large corporate gala.

In the past, your only responsibility would have been to create the best darn-looking suits possible.

In 2016, that’s no longer enough. You must also demonstrate a clear understanding of what the suits are for, how they’ll be worn, who’ll be wearing them, what type of event they’re for, and how every stitch will help that corporation reach their long-term business goals.

Sounds like a lot to be responsible for, doesn’t it?

It is. Even if you provide a service that seems simple and clear-cut, corporations are looking for diverse vendors who understand their overall business strategy. [3] You can no longer make decisions about how to serve your clients without considering the overall business goals of those clients.

While it may sound overwhelming, this is actually a good thing. Think of the tailor example again. The tailor who knows the who, what, when, where and why of the suits she’s creating will make a much better suit than the tailor who’s operating ‘in a vacuum,’ with no clue about her client’s overall business strategy.

Know how to articulate the overall business strategy of the corporation you’re targeting, as well as how your service fits into that overall strategy.

Trend #4: Technology, Flexibility, and Innovation

There’s nothing new about technology trending in the world of corporate supplier diversity. You’ve probably already had to navigate new types of software, applications, and processes to secure work and submit proposals.

What is new is the focus on flexibility and innovation when choosing diverse suppliers, which is happening because of technological advancements. Since technology is constantly changing, corporations seek suppliers who are very flexible, can adapt on at a moment’s notice, and are able to change as the company changes. [4]

At the same time, better and better technology necessitates hiring diverse suppliers who are highly innovative, and can help the company beat their competition. Just as technology is giving your client an edge, that same technology is making their competition more powerful. This means you need to be adaptable, tech savvy, and demonstrate innovative ways to help your client to stand out.

Begin by making sure your small business is up-to-date on the latest tech trends for your industry. When you know how to use all of the latest apps, software, and devices relevant to your industry, you can maintain the flexibility corporations are looking for.

Once you’ve mastered the required technology and have found ways to demonstrate your versatility in this realm, focus on creating new, innovative ways to solve problems.

  • Find fresh ways to create services and products for your clients and customers.
  • Look outside your industry to find inspiration from groundbreaking businesses and leaders in other spaces.
  • Look for ‘white space’ among your competitors, and your client’s competitors: where are other suppliers falling short? How can you fill in the gaps in unexpected ways?

Trend #5: Building bridges with other suppliers

Perhaps the most surprising trend of 2016 is the growing lack of ‘corporate’ in ‘corporate supplier diversity.’

In the past we’ve seen a strong focus on building relationships between large corporations and smaller diverse suppliers. However, with the advent of new platforms like the Supplier Connection Initiative and Dun & Bradstreet’s Global Diversity Registration Portal, diverse suppliers can easily connect with corporations as well as other diverse suppliers. [5]

The implications of this movement are huge. Just think of all of the vendors and service providers you utilize on a daily basis to keep your small business running strong. You may already make use of tax professionals, Virtual Assistants, marketing consultants, and all sorts of suppliers.

Now imagine being able to hire other diverse suppliers or, better yet, finding other Small Diverse Businesses looking to hire someone like you?

In 2016, the search for the perfect corporate client just might lead you to new opportunities with other diverse suppliers you never would have considered before.

The top five trends in corporate supplier diversity for 2016 are:

  1. An increased focus on value and ‘value-adds’ during the procurement process.
  2. Corporations seeking diverse suppliers who can demonstrate their business’s influence with their target market.
  3. Small Diverse Businesses that understand corporate business strategy, and can position themselves to help achieve corporate goals.
  4. Technology increasing the need for both flexibility and innovation in corporate/supplier relationships.
  5. Small Diverse Businesses building relationships with other suppliers, sometimes instead of with larger corporations.

 

References

[1] http://artofprocurement.com/rfp/

[2] http://artofprocurement.com/megatrends/

[3] http://artofprocurement.com/megatrends/

[4] http://artofprocurement.com/procuretech2016/

[5] Supplier Connection Initiative on YouTube: https://youtu.be/gqmkca9A-98

5 Ways to Help Secure Alternative Financing for Your Small Business

Originally published at AccessToCapital.com

Does the thought of applying for a traditional small business loan make you break out in a cold sweat? If you’re like a lot of small business owners, a traditional loan simply isn’t a possibility.

  • Your business might not generate the kind of cash flow traditional lenders want to see before offering a loan.
  • You may have had credit challenges in the past or other financial hardships that could make traditional lenders hesitant to work with you.
  • Your business might be brand new and lack the kind of solid financial history many lenders want to see before offering assistance.

But just because you’re not able to boast a clear upward trajectory of profitability and a perfect credit score doesn’t mean you can’t secure financing. In fact, there are many lenders that specialize in providing small business loans to businesses just like yours.    [Read more…]

How to Prepare for a Lender Matchmaking Event: A Checklist of What to Bring

Originally published at AccessToCapital.com

One of the most important steps to securing funding for your small business or startup is meeting your potential lender face-to-face. No other meeting or opportunity can have such an immediate, direct impact on the future of your business. After all, if the meeting goes well and leads to access to capital, the future of your business could change forever.

An Access to Capital event gives you the chance to meet with traditional lenders, alternative lenders, venture capitalists and crowdfunding experts – all under one roof. Normally you’d have to pursue these relationships separately, spending time and resources to set up meetings with the right prospective lenders. This type of event, however, allows you to conduct multiple meetings in a single day, as well as learn business credit basics from panels of industry experts.

Attending an Access to Capital event can be the first step in your journey toward financial independence and business profitability. With the capital you need to pursue your business goals, you can be able to:

  • Expand into more lucrative markets
  • Move into that new office you’ve been eyeing
  • Increase your marketing efforts
  • Improve and enhance your current operations

So how can you best take advantage of the opportunity in a way that’s most likely to get you approved for funding? Show up in a big way by coming to the event prepared with your business information, financial information, personal information, and that little “something extra” that will help get you noticed by the right lenders.

Here’s a breakdown of exactly what to bring in order to help put your best foot forward:

Your Business: The Basics

Lenders need to know basic information about your business in order to help them get to know your business, and see how their capital might best fit your needs.

Be sure to have this basic information on-hand in a way that’s easy to share with the interviewer. You might print out a one-sheet, include the information on a branded postcard, or list it as part of a promotional packet contained in a folder with your logo.

Basic business information should include:

  • Your official business name, including your “Doing Business As” (DBA) name that you use with the IRS.
  • Your contact information, including physical address, email, pertinent phone numbers, and fax numbers. Keep in mind that even if you use a P.O. box for your business, you will need to provide a physical mailing address to the lender.
  • Your company’s current status, including the business type, the names of all full and partial owners, and an historical breakdown of how business type and owners have changed over the lifetime of your company. Don’t forget to include the year the company was founded and a timeline of major events.

Your Financials

Lenders need to have a comprehensive overview and understanding of the financial health of your business, in order to see how they can best help you meet your goals.

While it may feel intimidating to share your financial records with potential investors, don’t feel like you need to present a snapshot of “the perfect business.” All businesses have ups and downs, and all businesses seek capital at different stages in their growth. Some businesses seek loans when they’re in need of help, while others look to partner with investors when they’re having an unparalleled period of growth.

Whatever your reason for seeking capital, full financial disclosure is crucial to successfully building relationships with lenders and investors.

Be sure to bring…

  • Your gross annual sales or revenue for the past five years, if possible. Keep in mind that your gross revenue is what your business generates before taxes, expenses, and business deductions are taken into consideration.
  • Your business banking information, including account numbers and balances.
  • Your tax returns for the past five years. If you don’t have these records handy, you can easily obtain them from the IRS. Just be sure to contact the IRS in advance of the event. In many cases you’ll be able to download your tax return from the IRS website. However, some tax years may not be available electronically and will have to be mailed to you, so be sure to plan ahead.[1]
  • A cash flow analysis that shows how money moves in and out of your business. A strong cash flow analysis includes three distinct sections, including your operating activities, investment activities, and financial activities. Beyond monies earned for goods and services and monies spent on business expenses, you’ll also need to include monies that flow in and out of your business in the form of loans, credit, and debt payments.[2]

Your Personal Information

Even though you’re pursuing capital for your business, you may still need to share your personal information with potential lenders. In fact, anyone who owns more than 20% of your company may need to provide their personal information as well. Investors and lenders interested in partnering with small businesses understand that businesses are comprised of individuals. For that reason, every owner’s personal information should be disclosed.

You’ll need to bring:

  • Your personal contact information, including your legal name, home address, email address, and personal phone numbers.
  • Your social security number and the social security numbers of all business owners.
  • Your date of birth and proof of your country of citizenship if you are not a U.S. citizen. A passport and birth certificate from your country of origin may be requested.
  • Your personal tax returns for the past three years, which should include a clear picture of your annual household income. Additionally, you should bring personal tax returns for any business owners with 20% or more ownership of the company.
  • Your personal financial statement that includes a breakdown of all your assets and liabilities. A personal financial statement should include assets like real estate, automobiles, and insurance policies, as well as liabilities like your mortgage, personal loans, and unpaid taxes. Each business owner should provide their own personal financial statement. You can download a sample personal financial statement here.
  • IRS form 4506-T for all business owners. This form is a request for tax transcripts, and will allow the lender to gain a more in-depth picture of your financials beyond your tax returns. You can download form 4506-T here.

A little something extra

Now that you’ve shared your personal, financial, and business information with your potential lender, why not share a little something extra? Don’t hesitate to bring a copy of your business plan, marketing materials, customer testimonials, goals, and success stories to share at the event.

Potential investors want to get to know you as an individual, and get to know your business beyond the numbers. Be able to clearly articulate why you’re passionate about what you do, and how partnering with them will change the face of the future for your business. If you have a clear vision of what you want to achieve and can demonstrate how you’re taking steps to get there, lenders will be that much more likely to start a conversation with you – a conversation with the potential to become a long-term, profitable business partnership.

 

References

[1] How to get a copy of a prior year tax return, IRS. Retrieved from: https://www.irs.gov/uac/Newsroom/How-to-Get-a-Transcript-or-Copy-of-a-Prior-Year-Tax-Return.

[2] Developing a cash flow analysis, SBA. Retrieved from: https://www.sba.gov/content/develop-cash-flow-analysis-your-business.

How to Prepare for a Small Business Matchmaking Event

Originally published on DandB.com

10 actionable tips for landing your dream client

Have you ever attended a small business matchmaking or networking event on a whim?

If you decided to be spontaneous and show up to an event without preparing beforehand, you may have struck gold and landed a big client. However, it’s far more likely that you struck out completely, and left the event feeling a bit dejected.

Like so many things in life and business, you get out what you put in. When it comes to matchmaking for small diverse businesses, the preparation you do before the event is just as important as your actions during and after the event – perhaps even more so.

Consider following these 10 simple steps to help start a lasting relationship with your dream client at the next event you attend.

1. Get certified.

First thing’s first: your business should be officially certified as a diverse enterprise.

There are many different types of certifications available, from programs through the Small Business Administration to regional and state-level certifications. There are also certifications available if your business is woman-owned, minority-owned, veteran-owned or LGBT-owned.

The type of certifications you obtain will depend on what kind of business you’re interested in procuring. Many states have Minority Business Enterprise programs to help diverse suppliers obtain government contracts, while the National Minority Supplier Development Council offers certification to help you obtain private sector contracts.

You’ll want to inquire of your prospective client(s) what type of certifications they require so you can be sure to pursue the correct designation.

2. Establish the right goals.

When attending a small business matchmaking event, your goal should not be to walk out the door with a contract in hand. While it’s certainly possible, it’s sort of like eloping with someone you’ve only just met.

Matchmaking events are all about making connections and beginning relationships. Your goals should include making a good impression, connecting on a personal level, and scheduling a follow-up phone call or meeting with the company’s Supplier Diversity representative.

3. Do the (right) research.

Do ample research before the event to determine who’s going to be there and what, exactly, they’re looking for.

This includes research on the companies participating in the matchmaking program, but it also means researching the companies that are sponsoring the event. You might even learn that a company you’re already working with will be attending the event. This is a great chance to meet their Supplier Diversity team and explore opportunities to gain new business within the company.

Take a good, hard look at who the key players are, which types of products and services the company regularly buys, and what needs are right now. You need to know:

  • Who consistently buys what you have to sell?
  • Who has a current need for your products or services?
  • What is the criteria for who they do business with?

The goal of all this research is to get strategic about the meetings you’re going to have. Don’t meet with someone at the event just to meet with him or her. Make sure you know the answers to the aforementioned questions to help increase your chances of making a profitable connection.

4. Audit your online presence.

Are you ready to be “Googled” by a prospective business client? What will the business find if it searches for your company or your name?

  • Audit your online presence to make sure everything that comes up is current, accurate, and positions your brand in the best light possible.
  • Spruce up your LinkedIn profile with recent projects, awards, and recommendations.
  • Optimize your personal LinkedIn profile and company page with relevant keywords related to what the prospect is looking for right now.
  • Consider reworking the wording of your online profiles to appeal to the prospect’s needs.

5. Book the (right) appointment.

Once you’ve signed up to attend the event, pay close attention to all emails you receive and social media posts you see that are related to the event.

Matchmaking appointments are often released in phases, and tend to fill up quickly. It’s crucial to act promptly when slots are released in order to book the meeting you want.

Once you’ve confirmed a matchmaking session with potential clients, your prep work is far from over!

  • Prepare for the meeting by researching the individuals who work in the Supplier Diversity department.
  • Consider reaching out to them on LinkedIn and let them know you’re looking forward to meeting them at the event.
  • Follow them on social media and engage with them in a consistent, appropriate manner, by liking, sharing, or commenting on their content.
  • Position your name and your brand in a way that’s recognizable. This can make them feel like they already know you, and will give you a foundational relationship before the event begins.

6. Pre-register as a diverse supplier.

Many of the companies that will be hosting meetings at the matchmaking event have an online Supplier Diversity Portal where they collect information about your business and search for companies to do business with. Do a quick Google search for “Company Name” + “Supplier Diversity” and you’ll often find the company’s site listed. You’ll want to register and upload all of the related documents requested to have a complete profile on file before the matchmaking event happens.

Supplier Connection is an online network that provides its participating buying members with access to a broad group of small business suppliers like you. By creating a profile for your company, not only do you increase your visibility with Buying Members, you will also be visible to other small businesses. This is another database where you’ll want to register and create a profile for your company before the event.

Registering for these databases before the event can save you time, demonstrate how proactive you are, and incentivize the Supplier Diversity professionals you meet to advocate for opportunities on your behalf.

7. Prepare your hard copy materials.

Walking around handing out your business card isn’t going to cut it at a matchmaking event.

You should also bring:

  1.     A copy of your Capability Statement
  2.     A copy of your Company Profile/Company Fact Sheet
  3.     Testimonials from past and current clients/customers
  4.     A bio sheet on the company founders

There is an art and science to creating aesthetically-pleasing, branded materials that will get you noticed and help the Supplier Diversity professionals you meet to remember you.

  • Use high quality paper with company letterhead and a clear, easy-to-read font for all documents.
  • Make sure each document is only one page in length.
  • Prep all four documents inside a brightly colored folder, along with your business card. Consider using a color that matches your logo and including a sticker logo on the front of the folder.
  • Prepare 3-5 folders for the event.
  • Prepare a digital version of the packet that’s ready to be emailed at a moment’s notice.

8. Craft the perfect pitch.

The way you speak about yourself and your business is just as important as your online presence and marketing materials.

When preparing to speak to the interviewer, practice using clear, succinct language that gets straight to the point.

Be able to clearly articulate….

  • What your company does
  • What kind of experience you have
  • Examples of proven results

Begin by filling in the blanks with the following statements:

  • We help ______________ accomplish ______________. We do this by means of our [products and services].
  • We have worked with ______________________.
  • We have the following certifications: WBE, MBE, VBE, LGBT-owned, State, etc.

Consider using your physical marketing materials to highlight your verbal pitch.

For instance, when mentioning whom you have worked with, pull out your testimonials sheet and show it to the interviewer as you verbally highlight past successes.

9. Rock your interview.

When the big day finally arrives, you may be feeling nervous and excited. Relax! You’ve put in a lot of prep work and it’s about to pay off.

One of the most important skills to have during an interview is the ability to listen more than you talk. Nerves often translate into rambling stories and oversharing. Let the interviewer direct the conversation, and answer their questions directly and specifically.

The more clearly you answer the questions presented to you, the more empowered the interviewer will be to match you with the perfect opportunity.

10. Follow up post-event. 

This is the most important step in the matchmaking process. All of your preparation and hard work will have been for nothing if you do not complete this step!

Before you leave the interview, ask the interviewer how he/she prefers to stay in touch. If they seem open to it, schedule a follow-up phone call or meeting right then and there. Next, create a strategic action plan for the days and weeks following the event in order to further cultivate the relationship.

If your goal is to forge an authentic connection with you’re the Supplier Diversity team at your target company, completing these 10 action steps can help you succeed.

Don’t be overly concerned about immediate outcomes and securing a contract. The point of attending a matchmaking event is to start a conversation and build a relationship over time.

If you are persistent about keeping in touch, and quick to respond when your contact reaches out to you, you can be well positioned to take advantage of profitable opportunities that come your way.

Small Diverse Business Trends: What You Should Know About Taxes, Healthcare, and Employment In 2016

Originally published on DandB.com

There has never been a better time to be a small diverse business owner in the United States.

With more and more attention being placed on diversity in the workplace, many companies, from small businesses to large corporations, are committing to diversity in both their hiring practices and their partnerships.

For many small business owners, this means a growing number of opportunities to work with influential companies and organizations as a diverse supplier.

Increased profitability and notoriety can be possible for your small business when you stay on top of employment trends, take advantage of current tax laws, and make the new healthcare requirements work for you.

Here are the top trends that are likely to have the biggest impact on small diverse businesses in 2016, and information to help you successfully navigate each to your advantage.

Tax Law

As a small diverse business, your company may be eligible for special development programs through the U.S. Small Business Association (SBA), and those who invest in your business may qualify for  lucrative tax incentives.

Keep in mind that you won’t necessarily qualify for tax breaks because you’re a small diverse business owner. Instead, other companies, corporations, and investors may qualify for tax incentives by partnering with or investing in your business, which in turn can create more profitable opportunities for you.

If your small business is located in a distressed area or an empowerment zone, you may qualify for special tax deductions. While many diverse business owners qualify for incentives through these programs, accessing the benefits is primarily contingent on the geographic location of your business, and not the fact that your business is minority-owned.

Because tax laws often benefit small diverse businesses indirectly, it’s important to stay informed about tax changes that impact all small businesses, diverse or not.

In 2016, there are several tax law changes that stand to impact small diverse business owners.

Section 179 allows you to deduct up to 100% of the cost of qualifying business equipment or software purchased in 2015. If you bought any kind of equipment – from a new printer to a new company vehicle – you can deduct up to $500,000 off the cost of purchase.

Don’t forget to consider software or other online subscriptions purchased during 2015. The monthly fees you pay for CRM software or your email marketing program will most likely qualify for this deduction. Talk with your tax preparer for details.

Another important change that can impact small diverse businesses is that the standard mileage deduction has decreased from 57.5 cents per mile in 2015 to 54 cents per mile in 2016.

While you still can’t deduct the cost of commuting between your home and your business, small diverse business owners who work from home may be able to deduct mileage between their home office and other business sites.

Healthcare

One of the biggest changes small diverse businesses may face in 2016 is the application of the Affordable Care Act.

This year, businesses with 50 or more employees will be required to provide health insurance to the majority of their full-time employees, or face some pretty steep penalties from the IRS.

What’s more, if your small diverse business falls into this category, you will have to follow strict reporting guidelines in order to inform the IRS about the health coverage you’re offering to your employees.

If you have 50 or more full-time employees….

  • You are required to offer health coverage to at least 95% of your full-time employees and their dependents up to age 26.
  • If you don’t offer coverage, you may have to pay up to $2,000 per employee in fines.
  • You are required to report how much you spent on healthcare for each employee by sharing that information on the employee’s W2 form. If you fail to report this information, or fail to report it on time, you could be fined up to $200 per employee.

Employment Classifications

If your small diverse business employs fewer than 50 employees, or you work primarily with freelance contractors, you may not need to offer health insurance or other benefits – yet.

With the rise of freelance workers in the United States and around the world, there is a growing debate about which type of employees should be treated like freelancers, and which should be considered traditional employees.

As a small business owner, chances are good that you’ve made use of freelance or remote workers in the past. Outsourcing administrative tasks, online business management, marketing, and other as-needed services can be a cost effective way to meet your business needs without hiring a full-time employee.

But what about a 1099 contractor who works 40 hours per week for your company? The U.S. Department of Labor argues that this type of worker should be treated as a kind of hybrid employee-freelancer, and offered benefits appropriate to that type of employment status.

In 2016, a new bill proposed by the USDL (USDL) will present a brand new category of worker. If the bill passes, small diverse businesses could be on the hook for additional costs, even when hiring freelancers.

While there are many potential new costs facing your small diverse business in 2016, there are even more benefits.

By forming relationships with companies that value diversity, pitching yourself as a diverse supplier, and applying for specialized status with the Small Business Administration, your small diverse business may able to take advantage of tax incentives, mitigate the rising costs of healthcare, and create a more profitable, sustainable business model in 2016.

To find a list of Fortune 100 companies committed to supplier diversity, visit SupplierEdge’s Supplier Programs page.

5 Ways To Help Develop And Leverage Powerful Business Relationships

Originally published on DandB.com

As a diverse supplier, your business is built on the power of your relationships. Only when you consistently reach out to prospective clients can you position your business to fulfill their needs and become their go-to supplier long-term.

But how are you supposed to meet the people in a position to hire you, let alone compete with all the other suppliers vying for their business?

The secret lies in strategic relationship development.

This is an area many diverse suppliers may overlook when they are applying for contracts or competing for a new client.

The adage, “it’s who you know,” does not negate the need for excellence in your products or services. It does, however, mean that forming and cultivating the right relationships with the right people can dramatically increase your chances of small business success.

Here are 5 proven ways to help develop and leverage powerful, profitable relationships with the people who are in a position to hire you.

1. Network Online and Offline

Before you can form a good relationship with a prospective client, you have to form a relationship, period. That means putting yourself in a position to meet as many quality prospects as possible, as often as possible.

The key here is not to meet people for the sake of meeting people, but to seek out opportunities to form connections with a highly targeted group of potential clients and referral partners.

Your first step is to do your research and determine whom exactly you want to meet. LinkedIn is a great tool for this because you can search by company name and title to find the specific people you want to meet. Create a spreadsheet that includes your target’s name, company name, title, LinkedIn profile ID and a note about how you think you can create value for them.

Trade shows, conferences, and association meetings are great places to make in-person connections. Focus on meeting and having a real conversation with 1-2 target contacts per event, instead of collecting as many business cards as possible. Be sure to read about their background, current role and interests via social media so you can strike up an interesting and engaging conversation.

At the same time, you’re not confined to offline events in order to form strong connections. Join online mastermind groups, Facebook groups, and LinkedIn groups specific to the industry you’re targeting. This will help you meet and connect with your ideal prospective clients online.

From there, you can schedule an in-person meeting if appropriate, or simply move on to Step 2…

2. Practice Considerate Communication

Find out how your prospect likes to communicate and honor that. If they use Google chat or Facebook messenger to contact you, don’t make the mistake of calling or emailing them to get in touch.

If you want to share a document or piece of content that requires another type of communication platform, ask them how they would like to receive it.

If you can meet them on their level by speaking their language, you’ll be planting the seeds to form a deep, lasting relationship based on consideration.

3. Get (Strategically) Social

In the same way that you communicate with your prospect using their preferred method, you should connect with them on social media by following their lead.

Following them on Twitter won’t do much good if they haven’t tweeted in 6 months, just as connecting on LinkedIn will fall flat if that’s not their platform of choice.

Find out where they like to hang out on social media, and make it a point to connect with them in a way that’s conducive to their social style.

Pay close attention to see if they share highly personal content, like family photos, then engage with them on a more personal level. If they tend to engage with industry-related content, consider sharing something you think they’d like and tagging them to get their thoughts. Make it easy on yourself to track your target contacts by creating lists in your social media account specifically for that purpose.

Speaking of sharing content…

4. Share Valuable Content

When courting a prospective client or customer, your job is to show them how much value you can provide and how working with you is going to positively impact their business.

One of the easiest ways to do this is by sharing relevant, valuable content to let them know you’re thinking of them and are attuned to their problems and needs.

For instance, let’s say your small diverse business sells fitness equipment to health clubs and you come across an interesting blog post about the latest in wearable fitness technology. Share the blog with your prospective client using their preferred communication method or social media platform. Add a note about how you’re incorporating the technology into your business and how you might use it to benefit their health club.

Keep it short and sweet, but clearly indicate why the content is relevant to them. This kind of specific, strategic value-add can demonstrate your understanding of the client’s needs, keep you top of mind, and make them think “Wow! If they’re helping me out this much for free, just imagine how much value they’ll provide when I actually hire them!”

5. Honor Their Wins

It goes without saying that you should be tracking the major happenings of any client you’re targeting, whether that’s product launches, award nominations, new employees, or other company news.

Set up a Google alert to help track your client’s wins online. Be the first to congratulate them on their successes, no matter how small. A simple email or text in response to some great press or an exciting merger can further cultivate and deepen the relationship.

The success of your business depends on the quality of your relationships. Strong business relationships don’t just happen when a client hires you or a customer makes a purchase. They begin long before that, when the prospect first becomes aware of how you might be able to help them.

By actively seeking new prospects, communicating in their chosen style, leveraging social media, sharing valuable content, and acknowledging their wins, you can cultivate deeper, more profitable relationships with clients who will be more likely to remain loyal to your small diverse business long-term.

If you’re interested in finding quality business contacts to create a relationship with, consider Hoover’s in-depth data on over 85 million companies.