Profit Minded
  • Datamining isn’t just for Big Brother and big businesses

    Housekeepers, exterminators, landscapers, and other small enterprises that make house calls might not seem like candidates for sophisticated data gathering and analysis efforts. But Jeff Annis says he’s “leveraging the microchip” to run his pest control company, Advanced Services in Augusta, Ga., more efficiently than ever. Mining their own data is enabling Annis and other small business owners to serve more customers and generate more revenue with fewer staff.

    By employing software to analyze and re-direct the routes that his technicians drive, for instance, Annis says he saved about 1,000 gallons of gas in one quarter. It added up to far more than a $4-per-gallon savings: “Our average vehicle is getting 20 miles per gallon. That’s 20,000 miles we didn’t drive at 40 miles per hour. And that’s around 500 hours of labor driving around from house to house that we saved,” Annis says. “If you think about all the ramifications of that, it’s time, rubber, risk to the driver, and wear and

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  • Dry Fly Distilling owners Don Poffenroth (r) and Kent Fleischmann

    Dry Fly Distilling owners Don Poffenroth (r) and Kent Fleischmann

    At age 44 Don Poffenroth made what some, including his wife, would consider a dubious decision. He invested all of his 401k retirement savings in shares of the startup business Dry Fly Distilling. But seven years later, he has no regrets. Dry Fly is an award-winning microdistillery with 5 employees and $2 million in annual sales.

    “My retirement savings is way, way better off than if it had sat where it was for the same time. I’m millions of dollars ahead of the equation,” he says.

    What gave Poffenroth such faith in that particular Spokane, Wash., spirits maker? He owns it.

    Rolling your 401k savings into a plan that invests solely in your own privately held corporation is a strategy some say has numerous benefits. “We had the ability to go to a bank and we had potential investors,” Poffenroth says, “but this made it so the money was cheaper, and we didn’t have anybody breathing down our necks. It allowed us to take our time with no immediate payments to the bank or returns to the

    Read More »from How investing his 401k savings in whiskey made an entrepreneur millions
  • Private Companies

    Wall Street may get the headlines, but did you know that of the 27 million businesses in the U.S., less than 1 percent are publicly traded on the major exchanges? The rest are privately held, and these private companies represent a vital segment of the U.S. economy.

    Here are four reasons to learn more about private companies.

    Private firms dominate. Out of the 27 million firms in the U.S., nearly all are privately held. Even among the 5.7 million firms with employees, less than 1 percent of them have shares listed on a U.S. exchange. And private firms are a growing majority of U.S. firms. The number of companies listed on U.S. exchanges has fallen from more than 7,000 in 2000 to fewer than 5,000 in 2012, according to statistics from the World Federation of Exchanges.

    It’s true that many private firms are small. But one look at Forbes’ annual list of the biggest private companies in the U.S. shows that some really big companies are privately held. In fact, private firms accounted for 86.4

    Read More »from 4 Reasons Private Companies Matter – A Lot
  • Shaking the Bode Tree: Everything you wanted to know about business valuation but were afraid to ask

    Valuation
    Many business owners assume they should only care about how much their business is worth if they’re looking to sell or are going through a difficult situation, such as a divorce or corporate break-up. Unfortunately, this is an extremely short-sighted view that misses the bigger picture.

    Valuation is the most important concept in finance, and something that every business owner should know something about. At the end of the day, each of us is in business to create value. Your company’s value captures nearly everything about your business in one, easy-to-understand number.

    Valuation has a reputation for being boring, abstract, and complex…and to be honest, it tends to be. But fear not, I’ve boiled it down to three key concepts that make it easy.

    1. Valuation Methodology
    2. Common Pitfalls
    3. Value-Based Management

    Valuation Methodology

    We’ll start with a simple definition – valuation is the price that a reasonable person would pay to own the future cash flows of a business less any debt owed plus all

    Read More »from Shaking the Bode Tree: Everything you wanted to know about business valuation but were afraid to ask
  • Case studies, inspiration and the time to start: Small Business Reading for May 31st, 2013

    Inspiration and ideas

    Ideas and inspiration. These are the starting point for any business whether it is a tiny mom-and-pop or the next billion dollar internet startup. We've recently profiled a set of businesses that are at various stages from just starting out to settled, global success and which cover a range of industries. But they have one thing in common - they all got their start from great ideas and inspiration. Take a look at Barefoot Wines, Ivy's Garden, Bulk Apothecary, Fish Flops and CampusBookRentals. For those of you that haven't yet taken the jump into starting your own business, you can get started with our series on starting a business - the links to the three articles that make up part four (all about naming your business) are below and you can find the links to parts 1 through 3 in them.

    Read More »from Case studies, inspiration and the time to start: Small Business Reading for May 31st, 2013
  • From $250,000 debt to $40 million sales: A small biz survival story

    CampusBookRentals founder and CEO Alan Martin

    In the years after racking up $250,000 in credit card debt to launch his startup, Alan Martin hit a couple of obstacles that he says “should have sunk us.” But his company, CampusBookRentals, survived and now, five years in business, projects 2013 sales of $40 million.

    His experience is a cautionary tale for any would-be business owner.

    Martin conceived his business idea while working his way through graduate school as a civilian contracts negotiator for the U.S. Air Force. Textbooks for his management classes were expensive, so he bought them used online, and sold them again at semester’s end. It occurred to him, he says, “I’m selling every book online for what I bought it for. If I could rent them out in between, it could be a cool service for students.”

    His wife, some friends, and he began saving credit card offers and set up shop in his Ogden, Utah, basement with a quarter million dollars in cash advances. He quit his job and the master’s degree program to build the company in phases:

    Read More »from From $250,000 debt to $40 million sales: A small biz survival story
  • Tending the Talent: Think Perennially

    Growing Talent

    Spring is here, and people everywhere are starting gardens. It’s not as easy as it sounds. Besides getting dirty hands, aching backs, and a sunburn, there are some serious decisions to make; one being whether to buy ready-to-plant starters, guaranteed to perform, or to take your chances with great grandma’s forgotten “heirloom” attic seeds, which may turn out great, or force a gardener, mid-summer, to ferry veggies from the grocery for the rest of the season. It’s the same choice businesses make when they hire talent: Sprout it from seed or drop in ready-to-bear-fruit starters? Here are a few garden tips from a “head” hunter’s perspective.

    Seeds

    It’s easy to get lost in a reverie, envisioning your business’s culture fermenting organically, seeded by fresh, hungry graduates primed to change the world. They are cheap, will work hard, and this game plan helps the economy--how much better can it be? Remember great grandma’s seeds - the ones that haven’t been tested - their “fruiting” ratio

    Read More »from Tending the Talent: Think Perennially
  • Rags-to-riches beach reading: the Barefoot Wine story

    Barefoot Wine founders Bonnie Harvey and Michael Houlihan

    Looking for a good book to get lost in this Memorial Day weekend? The Barefoot Spirit is an entertaining rags-to-riches story of American entrepreneurship. Released this week, the paperback has already climbed to the top of the Amazon bestsellers list.

    It’s the first-hand tale of California rule breakers Michael Houlihan and Bonnie Harvey, founders of the country’s top-selling wine brand. The couple conceived Barefoot Cellars in 1986, three years after they met in a Santa Rosa blues bar. They sold the business to E&J Gallo in 2005 for an undisclosed price that they say left them “satisfied.”

    Barefoot is famous for having rejected winemaking snobbery. Their colorful, plain-English labels marketed wine more like beer—a fun, not stuffy, beverage—with the slogan “get Barefoot and have a great time!” And by leaving the vintage and appellation, or grape harvest year and region, off their labels, the producer was free to blend a taste that was consistent year to year.

    Harvey says, “You shouldn’t

    Read More »from Rags-to-riches beach reading: the Barefoot Wine story
  • Fun beach reading for small business inspiration

    The founders of Barefoot Wine spent 19 years transforming their industry before selling the brand to E&J Gallo in 2005. Today, Michael Houlihan and Bonnie Harvey share their marketing and business savvy with other entrepreneurs and the nonprofit causes they support. (See our main story "Rags-to-riches beach reading: the Barefoot wine story.")

    Their book The Barefoot Spirit: How Hardship, Hustle, and Heart Built America’s #1 Wine Brand, released this week, is such an entertaining read that you won’t notice you’re digesting practical advice for anyone with a dream of business success.

    Yahoo! Small Business spoke with Houlihan and Harvey by phone from their Sonoma County home about how the “Barefoot spirit” and their experiences translate to other businesses.

    Yahoo! Small Business: What is "the Barefoot spirit?"

    Houlihan: Our book is really about the fundamental guiding principles we subscribed to that enabled us to overcome insurmountable challenges—not just with our business but in the

    Read More »from Fun beach reading for small business inspiration
  • Small Business: Big Crime

    Small Business Crime InfographicSobering news from Bolt Insurance in this infographic. We already knew that small businesses are far more susceptible to cybercrime than most owners think. But it turns out that plain old physical crime is also a high risk for the average small business. How bad is it? 35 times as bad - or put another way, a small business is 35 times more likely to be a victim of a crime than a large business. That's a shockingly high number. And what kinds of crime? Cybercrime as already mentioned, plus fraud, breaking and entering, shoplifting and a lot more.Even worse, the real numbers may be higher still since it is estimated that fewer than 30% of crimes against small businesses get reported.

    The annual cost to businesses in the US is staggering - almost $657 million dollars in office equipment thefts alone. The worst category of crime? Embezzlement which is estimated to cost small businesses a frightening $90 BILLION a year.

    Of course, the real reason is that small businesses cannot afford costly

    Read More »from Small Business: Big Crime

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ABOUT PROFIT MINDED

Profit Minded is the Yahoo! Small Business Advisor blog that looks at ideas, trends, commerce, and noteworthy developments that can help small business owners develop and grow their organizations.

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Owen Linderholm

Editor for Yahoo! Small Business

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