Idea Cafe's Small Business Grant Winner's Report
Report from Percy Marchand, Winner of Idea Cafe's Pilot Grant
When Percy applied for Idea Cafe's Small Business Grant, he said he was going to use it to promote his business. Since receiving our grant, Percy and his company, Marchand Ink, have been featured in The London Times and New Orleans Magazine, among other press. Now that's serious promotion!
After the end of each month, Percy candidly reported on his accomplishments, lessons learned and challenges to give you tips you can apply in your own business. Scroll through his words of wisdom below.
Percy's One-Year-Later Update: Percy's success since receiving Idea Cafe's Grant just continues to grow; take a look and get inspired!
December's Final Report: Business wisdom gained these 6 months
November Report: Expansion & growth, with wise spending decisions
October Report: New location, double revenue, higher prices and... TV!
September Report: Transitions, luck and respecting your limitations
August Report: Capitalizing on Idea Cafe publicity and rolling with punches
July Report: Trying radio, employees and community outreach
Percy's One-Year-Later Update:
Hi, I just wanted to say hello again to everyone at Idea Cafe. Things are still moving at rapid pace down here...recent developments: My business, Marchand Ink, will be featured in next month's (August 2007) Black Enterprise Magazine - We were also in the June edition in reference to my winning the $20,000 Miller Award (which I learned about via an Idea Cafe connection) a couple of months ago. And, I am now a candidate for political office - running for State Representative. Business continues to grow and revenues/profits up substantially - well over 300% since receiving Idea Cafe's grant and on-target for more!
Our latest community project is ACTUP, a free test-taking skills development program offered to high schoolers. Between YourhStartUp and ACTUP, I'm proud to say we're reaching more and more young people.
Thanks again to Idea Cafe for the grant that got things rolling for me!
It's almost hard to believe that it's been 6 months - I kind of have that "it's the end of your reign" feeling. I want to begin my report by expressing extreme gratitude to Francie Ward and Idea Cafe - whoever is the recipient of the next award is in for access to wonderful resources. Winning this grant propelled me into a spiral of success and accolades - The London Times, New Orleans Magazine's People to Watch, local newspapers and radio stations, and numerous websites.
As we begin 2007, I think it is fitting to recap what I've learned from my successes, failures, highs and lows. It's funny as I go back and look over my past reports. In "real life" and more aptly "real business" it's easy to go day to day without realizing where you have been (and unfortunately, sometimes, where you are going). Writing these reports for Idea Cafe has helped me to keep up with my goals and challenges and the progress (or lack thereof) that has been made in reaching them. I would highly recommend that current and future business owners do the same - just once a month, review and plan. Once you've compiled a few, go back and review. I can't think of a more effective manner to see your progress.
Rather than repeat previous reports, I'll give a few tips that recap what I have learned over the past 6 months since receiving Idea Cafe's Small Business Grant:
1. Do whatever you can to make your job easier while increasing your profit.
The trick here, however, is to use that added free time to better yourself and your business. It's kind of like the computer and Internet. They have made our lives so much more simple - but instead of utilizing them to help us do more we use them to do less. Take advantage of every opportunity, resource, and second you have to move towards your goals.
2. At the end of the day, a shinning dime isn't worth anymore than a dull, Katrina'd dime.
In other words, "Where's the beef?" I made several bad business moves over the past few months. Confessions: I started my first printing company in high school, so my beginnings were obviously sophomoric. Having a business wasn't a way to make money, it was a way to be different, to get on TV, to stand out... after all I've always had political aspirations. It wasn't until a year after I'd completed my degree that I realized that I had been wasting great economic opportunities. Although my focus has changed over time (focused on promoting the business and its services, not the owner), I sometimes make too many "self-promotion" decisions. I don't regret my decisions; I've actually learned a great deal from them - both technically and philosophically.
Months later, I think the money I spent on radio advertising and the thousands I WAS going to spend on television ads could have been used better. Don't get me wrong, advertising is a key part of business, however, you must select the proper advertising means for your business. I own and operate a small print and copy center. Radio and TV's reach could potentially ruin my company at its current operations level. I have found that flyers, sponsorships, direct marketing are much more effective and produce huge returns.
So in other words I spent five dimes making sure my company was a shinning dime, when all along I could have just had six dimes. Enough with the confusing analogies - bottom line: remember why you are in business and make decisions that fall in line with that mission.
The advertising was a great learning experience and I know have knowledge that will help my company and self in the future. It also accomplished the goal of re-introducing my company to area.
I also expanded my personnel too quickly and unnecessarily. This was another one of those decisions based more on the "hey I have 'x' number of employees" - expensive misstep.
3. Think Big, Act Realistically
Looking back at my reports, I tend to have high expectations... a good thing, but dangerous if not kept in check. Thinking big allows your company to have a vision, a goal or challenge to meet. Acting realistically is what gets you there. Have a plan for your operations that encompasses all segments of the spectrum - "failure", success, and over-success. Be prepared and allocate your resources in an efficient and effective manner. Understand that there are few things that go exactly as planned, and even fewer cure all, bread winners. Don't be discouraged. Re-evaluate, re-plan, and re-execute.
4. More Than Likely... It WILL be There Tomorrow
Disclaimer: this is directed at SMALL businesses.
Carpe Diem - Seize the moment! Not so fast. One of my biggest faults (that I am making steady improvements on) is rushing things. After all, if I don't do, get, have, or release (insert unnecessary item/service/person etc) then I will miss out on this great opportunity. Unfortunately, resources get diverted to making "x" happen, and when and if it "x" occurs, too-often it does not have the impact originally anticipated. My advice, take some time to think through your decision. Will it really help you accomplish that mission? Do you have the resources needed? Is it worth diverting your attention away from other areas - meaning will the potential loss in other areas outweigh or moot the potential gains from adding "x"?
Spend as much time planning in advance, so that when opportunities present themselves, you are better prepared to act (or not act) on them. Sporadic decisions can often have long-term negative effects.
Well I guess that about sums up the meat of the business wisdom I've gleaned during this past half-year.
Good luck to all of Idea Cafe's current competition's contestants. Thanks for taking the time to "live" my business through these cyber reports. Remember, the 7 in 2007 is for 7 figure revenues... Speak it into existence!
Best of Business!
Marchand Ink, New Orleans, LA
The Past Catches Up...
This has been a pretty good month at Marchand Ink. A lot of actions I took early on are starting to catch up with the company. I spent every night of last week sleeping on a card board box. On average I got about 2-4 hours a sleep/day; and I didn't do the television advertising that I was set to do.
Yes, this month took a lot of unexpected turns. I was sleeping on a box in my office, because I couldn't find time to sleep between the magnitude of orders that poured into the office. The actions, previously completed orders, have caught up with me in numerous customer referrals; and we experienced our biggest sales week last week!
Of all the advertising I have done, it appears that word of mouth has prevailed. Don't get me wrong, the other advertising (flyers, radio, ads, etc.) were all vital parts of the marketing mix, but word of mouth is what got the door to my store swinging - just goes to show you how powerful reputation is. On to the report:
1. FINALLY started shipping Fedex.
- As with any young kid with a bright idea, I was a little over zealous about the impact shipping would immediately have on my business. I expected it to start off with a bang and double revenues almost instantly. Well....(wheels begin screeching) I've shipped about 10 packages so far.
- I was not prepared for the influx I anticipated. By the service starting off slowly, I was able to work out kinks and learn more about shipping and FedEx.
- I am now listed on the FedEx website and have actually been getting a lot of print/coppy jobs from that listing (they assume we're a FedEx KinkWHO's????)
- Shipping is increasing
- I began right on time to latch on to the Holiday Season shipping rush
- Offering the packaging and shipping services helps me effectively compete in the refining market
- FedEx wasn't too helpful in regards to training/guidance.
- Purchased more shipping supplies than needed
2. Controlled Spending
- I have firmly instituted my previously mentioned, (but renamed) spending policy, "if it doesn't make dollars...it doesn't make sense". Although I still have a pretty extensive "wish list", I am focusing on retaining earnings and not investing so heavily in equipment. I have set a base goal for savings and after reaching that level, I will then return to investing. My business has grown substantially, but I have sacrificed being able to enjoy the fruits of my labor in able to get "that new printer." My business is now operating at a level (capabilities) that I feel comfortable with and therefore I am comfortable redirecting the company's earnings. My spending will be on operating costs, supplies, and inventory - all items with lower costs that immediately affect the bottom line.
3. Added Staff
- I have finally added a graphic artist (in training) that I believe will work out - and she was desperately needed. I picked up on another graphic company's loss, and although she was in a different segment of the printing industry (clothing/signs), her background makes training a lot easier.
4. All Systems Ready!
- The new location along with proper planning have finally allowed the company to operate at a pretty efficient and effective manner. Now that everything has it's set place and procedures are established and communicated, things have been running a lot more smoothly. When you are a small business, it is easy to forget the rules and do things how and when you want. As my business continues to grow, I have seen the value in order and consistency.
5. Thursday means Thursday not Saturday!
- NEW POLICY - I try my best to accommodate my clients, but often bending can lead to breaking - or a sore back at the minimum. I constantly set deadlines for clients to turn in jobs, but they are rarely met. As a result, my labor cost increase, the job is not done as well as it could have been, and is often late. The result - My company looks like it didn't do it's end. All the guests at a banquet know is that Marchand Ink got the printing job, but the invitations are late.
To account for the aforementioned problems, I have instituted a new policy: There will be a 25% rush fee added each day that an order is late. This will deter clients from being late and if they are then I will at least be able to afford my chiropractic visits.
Upcoming Challenges for December:
- Don't get too caught up in the Holidays
- Continue paying off debt
- Get supplies/inventory purchasing/pricing in order
"The hardest thing to accept about planning is when it all goes...right."
1. Became an authorized retail shipping center for FedEx
Call this one a dream deferred. I actually intended to become a shipping center for UPS, FEDEX, and DHL when I re-started my business in February. Location, space, a lack of time, and requirements delayed the move until now.
Goal: Double daily revenue. As of now, we will be the only shipping center serving half of New Orleans. The possibilities are honestly somewhat overwhelming. Customers who have seen the "coming soon" sign have been elated at the idea of not having to travel downtown everytime they need to ship.
Learn as much about shipping/materials etc. in a short period of time without letting customers know we're still learning and a little wet behind the ears.
Between boxes, equipment, supplies, etc. the investment was slightly more than expected.
Was about to do it again - stretching resources too thin - trying to be an authorized center for all three companies would have not allowed me to efficiently/effectively learn about each companies policies, rates, etc. It would simply be too many systems in play at once.
2. Completed transition to new location
- Sales have significantly increased in every way - daily sales, average sales, clientelle.
- Have been able to be much more productive with added space
Goal: Solidify operations at this facility in preperation for further down the line expansion to additional location(s).
While the move has increase revenue, it has also increased expenses. While we are doing well, it has been a daily struggle to make sure that adaquate cash flows are maintained. Equipment purchases, rehabilitating the new location, and increased operating costs have significantly reduced available funds.
Also, we need to finalize our customer internet/computer usage area/pricing
Every business in New Orleans is fishing for creative advertising tools. There are few accurate databases to pull from as people's contact information is changing regularly (since January, my business had 5 different addresses). In my marketing pursuits I have learned (or at least been shown - AGAIN) that small businesses create self-imposed barriers.
As I stated in previous reports, I did some radio advertising. A television account executive approached me about doing tv ads, but I ignored it "knowing" that it would cost 10-20 thousand dollars between production and advertising.
Another exec approached me and assured me that I could afford tv ads - turns out the TV ads are actually substantially less expensive than the radio ads. Marchand Ink television ad on its way!
Lessons Learned: Don't assume! Be open to explore opportunities
4. Instituted Higher Pricing
I don't want to even think about how much revenue I've given up being afraid to charge what my services commanded. I would do the work, prepare the bill, and say "That's too high, I'll knock (many times) a couple of hundred dollars off". Regular and pop-up expenses have made it extremely easy to charge adequate prices. I also feared that I would lose jobs if my prices were "too high".
Lesson Learned: Keeping a profitless job doesn't keep the lights on or gas in the car.
Goals for November:
- Adequately increase staff (shipping and increased business demands it)
- Double Daily Sales
- Substantially Reduce Debt
- Make services more uniform and reliable
September 2006 Report
Business Accomplishments for the Past Month: TRANSITIONS
I have entitled this month's report "transitions" - as my business is currently undergoing several of them.
1. Physical Transition: Began work on 1,200 sq. ft main street retail location twice the size of my side street current office. Move will be finalized in two weeks. This transition actually puts me back at my pre-Katrina location. In May 2006 I moved to a smaller, less expensive office and have now outgrown that space; both physically and operationally.
- Increased Visibility: The move will provide valuable added exposure. There is a huge jump in revenues from walk-in clients who see the office as they pass by. Retail location becomes unofficial "billboard"
- Increased Services: I was at an impasse at the smaller office. I will now be adding shipping services that I expect to double my current revenue as well as increase the traffic and awareness of my business. I will also offer internet and computer usage as many residents are in town for a few days working on gutted-out houses with no computers or internet service.
- Increased Space: It was becoming increasingly difficult to stay organized as more equipment and orders came in. The new space will allow me to operate much more efficiently and effectively.
- Increased Hours: With the added services and visibility, the company can now afford to increase its hours of operations to include Saturdays and eventually Sundays.
2. Service Transitions: As business has picked up and my time and resources have become more stretched, operational modifications have become necessary. I often found myself over-worked and under-paid. I re-assessed the profitability and time/effort required to complete various services.
- Core Services: After assessing services, have selected core services which the company will push and focus on. These are services that are either simple to complete, very profitable, or a mixture of the two.
- Secondary Services: Clients like the idea of a one-stop shop ; so therefore I will not eliminate these normally less profitable and work/time intense jobs. I will, however, not push these items and have placed premium prices on them.
- Customer Service: This has been the most difficult transition. When business was not as busy, it was easy to provide free added services to clients such as delivery and pick-up. Now that business has picked up and time become more critical, I have had the challenge of explaining to clients that they will be receiving less service for the same (or more) price. Something to consider as you bend over backwards to gain clients and revenue.
Additional Lessons Learned:You've got to spend money to make money!
OK, it's generic, but there's some fine-tuning that I've experienced. Re-word: You've got to spend money efficiently and effectively to make the most money.
As revenues increased, it became easy to be easy with the checkbook. Whats $50 more a week when you're bringing in $5000/week? Then when you add another $30/week and/maybe an extra $10/day, you end up unnecessarily spending lots of money and not getting corresponding returns. My new criteria for business spending is:
- Will it make the company proportionally more profitable?
- Will I have the resources (time, supplies, expertise) to provide the service?
- Is there a less expensive/more profitable alternative?
- AND MOST IMPORTANTLY: Do I need this RIGHT now? Cash flow is a crucial element to a small business.
That stated I recently purchased a machine for $4,500 that has increased my weekly revenue by over $600 without even advertising the service.
You've Got to Be Lucky!
I borrowed that from Dr. Norman Francis, President of Xavier University of Louisiana. Being "lucky" is being prepared when an opportunity presents itself.
I have seen this first hand as I have been very lucky as well as unlucky (not prepared). This lesson has caused me to realize even further the importance of a comprehensive, future-focused business plan.
You've got to make time for you!
I wish I had a penny for every client who has rushed in needing a job as soon as possible. (If so, I'd be a millionaire soon, then I could catch Bill Gates.) To accommodate the client's emergency, I'd push hard to get the job out, often spending the night at my office, thanks to whoever created the air mattress. Noon deadline gets met and the client is nowhere to be found until hours, sometimes days later.
Lesson: Understand your limitations and don't bend.
It's the only way to provide consistent, reliable services. Otherwise you will end up burning yourself out and it may even begin to affect your physical and mental health. That stated, as I have pulled weeks of 15-20 hour days. I wore myself thin and become less productive and grouchy. I have committed to make time for myself and sleep and have since been much better off.
August 2006 Report
Business Accomplishments for the Past Month
1. Continued to capitalize on Idea Cafe publicity: Received coverage in The London Times Magazine and was named one of New Orleans Magazine's "People to Watch."
- Publicity tends to come in a domino effect. You're hot or cold. When you're hot, like I have been since winning the Idea Cafe Small Business Grant, you've got to take advantage of it. But be sure to properly balance between giving interviews and photoshoots with maintaining/growing your business. The worst thing you could do is get a bunch of publicity and not be prepared to fully operate when the rush of new clients come. Luckily, I have been pretty successful at managing both.
2. Became "un-official" printer of the City of New Orleans
Although the City has its own in-house printing/copying center, back logs and a sometimes lack of creativity have allowed me to ease into City Hall through the back door. While the turn-around times are often quick, and the payments often delayed, the added business as well as recognition (Design and Print by www.MarchandInk.com) make it well worth it.
- When dealing with governmental agencies (particularly elected officials) you MUST be very cognizant of the environmental politics: whose name(s) should / shouldn't be emphasized, what pictures to use / not to use etc.
- Make official contact with the person(s) who are authorized to contract services - many people use titles to get things under names
they aren't authorized to use
3. Got fully organized.
Although I worked out my business plans, as is with many things in Post-Katrina New Orleans, things changed. Although it may seem inconvenient to revisit and modify your business operations while your business is booming...if done properly it can be a few well-invested hours and result in increased productivity and profitability.
1. Managing work load so that employees are kept productive and effectively used.
2. Being able to adjust and profit from fluctuating revenue.
Actually had a two week period where average daily sales total was about $20...with a minimum daily payroll of $100, you can imagine how my pockets cried...thankfully those were just some slow weeks...BE PREPARED BOTH FINANCIALLY AND MENTALLY FOR THESE WEEKS they WILL happen - don't let them discourage you. Average daily sales have since picked back up to $600.
July 2006 Report
Business Accomplishments for the Past Month
1. Implemented first radio marketing effort
- Ran 2 different ads on 2 local radio stations
- Total spots: 64
- Ad placement (number of spots/time of day/etc.) is crucial
- You pay for what you get (spots during high rating periods of the day are priced at a premium, but prove more effective)
- Results are not going to happen over night and you can't put all your eggs in one basket; any ad placements should be part of an overall strategic marketing plan
The campaign did a good job of letting people know I was open, but did not immediately translate into direct sales
2. Hired and released employees
- Added 4 people to original staff of 2 (including myself)
- 2.5 graphic artist, 1.5 production assistants
- Hired additional staff expecting swell of sales following radio advertising
- Don't count your eggs before they hatch. Anticipate and prepare, but don't sign the dotted line until everything is in place
- Be explicit about expectations and responsibilities
- Plan out how you will handle human resource issues before they become issues, i.e. when and how will I terminate employees
- When you start off -- no matter how many employees you hire, you will probably work even more for the first few weeks/months (now you have to train the employees, do your work, and re-do the work when they mess up). All of this depends on whether your labor is skilled or unskilled. Unskilled is more affordable and available to smaller businesses
- Don't pay the max you can pay initially; leave room for your employees to grow and receive raises, i.e. I can afford to pay $10/hour, but I will start a worker at 7/8 and let them earn the remainder. There are several creative payment/reward/productivity based salary models out there.
Released 2 employees and reduced payroll substantially
3. Implemented Community Outreach Program
- This has taken a lot of time away from my business, but I feel that it is important to reach back and give. It will payoff in the long run.
- Was able to tie recruitment efforts for the program to business, ie domain (www.youthstartup.com) actually pointed to my business website which has a link to get to the actual program website
- As a small business, recovering from post-Katrina set-backs ourselves, it seems impossible to be doing such a massive community service project, but that plays to my advantage when it comes to publicity or getting recognition for the program/business
- Before the program I worked, at minimum, 9am-6pm M-F. Now I teach the program from 9am-1pm and work at my business from 2-6pm. The change in scenery and job description has been relieving and allows for maximum productivity.
15 participants are one week from completing the summer program
Top Business Goals for the Next Month
- Increase daily revenue goal to $500-$600/day
- Implement direct marketing campaign to other businesses
- Develop tasks and procedures for operations so that employee training/productivity can be improved
- Further develop and utilize systematic approach to order fulfillment. As a small business it is easy to change the rules with each job, but this is obviously not very productive. Having systems also makes it easier to train employees.
Why Idea Cafe chose Percy to receive this grant
To see more grants: government grants, SBA, corporate, more private grants, enter Idea Cafe's Free Grant Center for Small Biz -- a privilege for registered Idea Cafe Regulars only. GO!