Small Business Tip of the Day: Creating Contracts

I’ll start this post off by saying I am not a lawyer, and none of what I put anywhere on my site should be construed as legal advice.

Today’s topic, however, is one that involves legally binding agreements. So let’s just say the following are my opinions on the basics of creating contracts for your small business.

As a small business owner, if you aren’t using written contracts yet, you should be. Although verbal agreements are valid, enforcing them gets tricky when the parties disagree over what was previously discussed and have nothing in writing to back either side. Therefore, written contracts are best for everyone involved.

Image: www.behavioradvisor.com
Image: http://www.behavioradvisor.com

If you follow a few basic guidelines, your written contracts can become another business tool in your skill set.

  1. Get all the details down in writing. Even something as seemingly obvious as who is providing the service and who is receiving it needs to be spelled out. It’s most important to include: the date the contract takes effect, the names (and roles) of the parties involved, the exact products or services included in the deal, any and all deadlines for completion of the contract terms, and the payment amounts and due dates.

  2. Don’t allow legal jargon to complicate your contract or intimidate you not to create one in the first place. In fact, you can create a perfectly legal contract without any legalese. My best advice is to keep your wording as simple as possible and avoid any ambiguity if possible. A clear, simple contract makes it easier to spot any potential mistakes and allows either party to edit any risky or uncomfortable language.

  3. Include an escape route.  Name the specific terms under which you or the other party is allowed to end the contract. Include how to give notice of contract termination to the other party and how far in advance the notice needs to be.

Keep in mind that while it’s a good idea to create your contract in a professional format, any kind of agreement in writing is legally binding. (I once rented a condo from a woman who worked in the legal system—she drew up our rental agreement on the back of a piece of scratch paper!!)

Also, don’t forget that all parties involved in the agreement need to sign the contract. If a representative from your company signs, be sure he or she has the authority to act on behalf of the company.

I have seen and heard a few contract horror stories in my career. Based on your own experience, what contract tips do you always practice?

The Year of the Blog

Are you one of those people who wakes up every morning and “reads” your smart phone as though it were the newspaper? I am! I check each email inbox, then move on to my news feeds. If it’s a good day, I can spend at least half an hour browsing the day’s top stories over a cup of coffee. Something I read today caught my eye…

Somewhere in my Twitter feed this morning was a business article stating how 2012 was the year of Twitter. According to the author, last year Twitter ruled the social media scene.

I’m going to go out on a limb and say 2013 is going to be the year of the blog. Just in the past couple of weeks, I’ve read at least a dozen articles and blogs about content marketing. This morning my Sunday newsletter from business genius Chris Brogan was all about how to create content that interests your customers and makes them feel like they are a part of something–like they belong.

In my experience, creating content is the hardest part of blogging. Setting up a blog is fun and exciting, linking the blog to social media accounts is satisfying, but there’s something about sitting down and staring at a blank screen that sucks the inspiration right out of me.

If I’m right and content will be king in 2013, then small business owners who want to stay on the path to sustainable growth must understand the importance of blogging. My advice? Take a cue from Twitter’s success and make your blog more like a conversation. Keep it light rather than formal. Ask questions. And at least some of the time, share content about topics you truly love. If you’re passionate about what you’re writing, chances are you’ll strike a nerve with someone else who shares the same interest.

Are you one of those people who shares online content when you find it truly engaging or entertaining? I am, and if my social media feeds are any indication, most of us are. I believe this year, the most successful small business owners will be the ones who create content that compels their audience to join the conversation. So what are you waiting for?

Small Business Tip of the Day: Understand Your Target Market

In business school, the subject of defining target markets comes up repeatedly. Define the market with demographics and psychographics, don’t be too general, don’t narrow it down too much, do your research and slice that pie!!

Although identifying your target market is undoubtedly an important step in creating your overall marketing plan, I think a lot of small business owners get lost in the technical lingo and either try to market to everyone or fail to formulate a plan at all. As someone who’s not a fan of the “Ready, Aim, Fire” approach, I want to share my take on how small business owners can better understand their target customers.

Target

1.  Define the original purpose of your business. Yes, again. Many small business owners who are fighting for enough business to turn a profit lose sight of their original goals. Stop for a second and write down why you are in business. What product or service are you offering? Be specific and try to remember why you started your company in the first place. Did you want to help others? Was your goal to get rich? Did you desire to make a name for yourself? Whatever the reason, get back in touch with that logic. Make sure it still applies, and reaffirm your commitment to doing business the way you always intended. If you don’t take this first step to defining your overall business goal, then you can’t very well understand your target market.

2.  Look at the the customer base you currently have. Who is using your service? What is the average person who buys your product like? Instead of trying to come up with an age, sex, income level, etc. for your target customer based on what you think your target customer looks like, take a hard look at what they actually look like. You may be surprised at what you find, but effective marketing is aimed at the people who want to buy your products, not at the ones you think should be buying them.

3.  Connect the dots. Once you are 100% committed to your business goals and you have a good idea of who your most frequent customers are, all you have to do is put the pieces together. Find a creative way to show those target customers your business meets a need they currently have or will have in the near future. When I reach out to potential clients, I like to consider the lifestyle of my target customers and show them how my business fits in with and improves that lifestyle. You have to find the approach that works best for your business, and if you have a hard time with this step it may be a good idea to seek the advice of a business consultant.

I know the demographic/geographic/whatevergraphic approach to market definition serves its purpose, especially when applied by professionals and academic experts. But if you are the average small business owner, then you may not have the knowledge or the patience to wade through the jargon.

My advice: Understand that marketing to the appropriate customers is a worthy investment, and apply whatever method allows you to focus on and reach those customers.

Stay focused and do work!
Stay focused and do work!