Making Money From Blogs

I've been blogging for a little over a year and one thing I have found to be true is that making money off of blogging is hard work.  First of all, you need fresh topics to write about continually.  You have to give your readers a good reason to keep coming back.  Then, you have to very highly publicize your blogs.  I'm getting better at this.  Currently, my blogs are promoted the following ways.

1.  Listed on Technorati
2.  Listed on Blog Catalogue
3.  Listed on Zimbio
4.  Listed on Delicious
5.  Shared thru Google Buzz
6.  Shared thru Google Reader
7.  Shared on Facebook
8.  Shared on Twitter
9.  Links with other bloggers.
10.Emailed to select readers

Since really getting into the blog promotion phase of this project, my page impressions have increased over 400% monthly.  Having a solid readership is of critical importance if you every want to make money from blogs.  You also need to invite people to follow your blogs.  This can be done through Google Friend Connect, Feed subscriptions, and anything else that is available for readers to click on to follow.

Some things I didn't think of until a friend of mine suggested it is to link my blogs together.  I currently have 4 active blogs.  Each of these has links to the other 3 blogs.  This makes it easier for readers to find all of my blogs.  It also helps your Google search ranking which is very important if you want people to find your work.  Other things you can do to increase your page rank are:  incorporating search terms in your blog titles and in the body of your posts.  I also use a labels gadget to make sure all of my labels (which are nothing more than Google search terms) are repeated several times throughout my blogs.

Once you have readers, now you have to figure out how to convert readers into dollars.  The easiest thing to setup for starters is Google AdSense.  These are the ads that you often see at the top and along the sides of pages you read on the internet.  When people click those ads, you get paid a small fee for driving traffic to those advertisers.  The problem here is that Google doesn't allow you to actually TELL PEOPLE TO CLICK ON THE ADS.  So, people just have to figure that out for themselves.  You just have to hope that the ads are enticing enough to get people to click. 

Most of the time, when a person doesn't want to click ads, there are really just a few reasons.

1.  Privacy - many people fear that advertisers can track their internet usage.  Nobody wants this.  Clear out your cookies and temporary internet files and that should take care of most of these worries.  Generally speaking, your privacy is safe with Google AdSense.

2.  Safety - it is common to fear viruses and other harmful applications that can hit your computer from clicking on ads.  For me personally, I will click on ads from reputable companies because I trust that those ads will be safe.  Generally speaking, ads are safe.  Just be smart about what you click on.

3.  Value - If ads do not appear to have great value, nobody is going to click them.  This is the responsibility of the advertisers.  Your job is to simply get eye balls to see the ads (but don't tell people to click them).

4. Attraction - if the ads aren't visually attractive and stimulating, many people will not think to click them.

Remember though:  you can not tell people to click on your ads.  Instead, your viewers have to understand that these ads are how you pay for your time of providing valuable information to them.  Your information is free to them.  If they see an ad and have interest, then clicking on it can benefit them and compensate you for your good work.

Other ways that you can make money from your blogs include:

1.  Sell something related - I am going to use my blog to promote my upcoming management book.

2.  Offer advertising space to willing advertisers.  You may be able to get paid directly from advertisers.  I am going to contact some of these companies for this very reason.  Eventually, someone will agree to a deal.

3.  Associate / Affiliate Programs - these are programs where you get commissions for selling products on your blog site.  You provide links to products and when people click and purchase, you get paid.  Amazon.com is big in this area.

4.  Offer you personal services.  You are probably an expert at the topics that you write about.  Someone might want more individualized help from you.  Offer this as a consulting service and get paid for it.

These are just a few of the points that will help you make money from your blog site.  Surely there are other ways and you should explore your options if you want to make money from blogging.  Start with the information here in this article and build from there.  If you're like me and you're already writing blogs, you might as well get paid something for it.

Business Management: Don't Be Blinded By Success

I've learned a very valuable lesson this year following 3 back-to-back-to-back record breaking years (hence the name, Record Breaker).  Never be blinded by success.  It can be here today and gone tomorrow - especially in the field of medicine where most times, your biggest competitors are the state and big insurance companies.  Legislation can eat your lunch if you are uninformed and under-prepared.  That's really for another article, at another time.  For now, the lesson is to not be blinded by success.

Success is great.  Celebrate it, but do it again.  We had such huge success over the last 3 years, that it sort of masked some serious problems that needed our attention.  As my office's top manager, this is my responsibility - to not take my eye off the ball.  The first 4 months of this year were very bad.  We had a lot of catching up to do.  Along the way, we realized that we needed some new training and new processes.  We found that what got us here wasn't going to get us where we wanted to go.  We've had to slightly change the way we operate.  We've plugged some of the holes and we're working on plugging the rest.

Success in business deserves celebration today and then a short memory tomorrow.  Always re-assess your current situation and make sure you keep doing what it's going to take to get you where you want to be tomorrow.  Smart competitors will adjust to adapt to their failures and to try to beat you.  The legal environment may find ways to work against you.  Be ready.  Be over-prepared.  KEEP WINNING.  Being a Record Breaker is about on-going success.  It's about breaking through barriers.  It's about never quitting and it's absolutely about BREAKING RECORDS.  So, do what it takes to keep breaking records and DON'T BE BLINDED BY SUCCESS.

Incidentally, because we took the short-term blinders off, we've gotten back on track because that's what happens when you're on top of things.  We are now on pace to have an exceptionally good year and finish strong.  Record Breakers find a way to create success.

Negotiation Backfire!

A week ago, I wrote about a business negotiation I was doing for some yellow pages advertising space.  You can read that at the following link:  http://chelmsmba.blogspot.com/2010/08/negotiating-experience-of-day.html.  Today, I finalized the deal and wanted to tell you about the outcome.  The title of this post is "Negotiation Backfire!", because of the way it ended up for the sales lady.

After she applied time pressure to me last week, unsuccessfully, she went on vacation and didn't get back to any of my emails until today.  When she finally replied to me, she told me that her boss wouldn't accept my offer of $2,500 per month for the back cover of the phone book (basically the best advertising spot on a phone book), and that it was originally going for $4,500 per month.  Incidentally, reading back to my previous post, $200 above my offer would have been $2,700 per month and I would have said yes to the deal.

Since I last spoke to her, I surveyed lots of my customers to find out that 72% of them use the internet for search instead of the phone book.  Seems like a no-brainer to me too, but written statistics can be very powerful, so I put together the data.  I presented the data to her and told her that with that information, I no longer cared if I was in the book or not, and that I would just go ahead and continue my previous 1/2 page advertising, but I would need it for 1/2 the price.  This was not a threat.  It was just a matter of fact that I was going to cut my advertising in half with her phone book.  That's a great negotiating principle - sometimes, a great impact can come from pulling dollars off the table that were already assumed to be part of an agreement.

Her response was priceless for me.  She sort of did the same thing that I did.  She told me that because we took so long to come to an agreement, that the advertising on the inside of the book had already "closed" and that my previous ads were no longer an option for me.  The only remaining option was this UNSOLD back cover, so she offered it to me for $2,800 per month.  (No kidding, as I write this my I'm smiling with a feeling of excitement.)  Anyways, I turned that back around and offered to take 100% of my dollars off the table instead.

I said that since I couldn't get my prior "ineffective" ad space for half price because she took a vacation in a failed attempt to apply even more time pressure on me and caused me to lose the only thing I had even a little interest left in, that I would pay $1,400 per month for the back cover.   If we couldn't do that deal today, I told her I would just take that $1,400 and advertise with her competition (it wouldn't be the first time I had to do that anyways).  She faxed over a contract for $1,400 two minutes later.

So, let me summarize the value that I got from working all of the necessary tactics on this deal.

Back Cover original price = $4,500 per month ($54,000 per year).
My Final Negotiated price = $1,400 per month ($16,800 per year).
A difference of $37,200 per year in my favor.

The real killer part of this deal though is not in the money that I saved above, and that's a lot of money for something like this.  No, the best part is that for $329 LESS PER MONTH, I have the BEST advertising spot available.  Being inside the book is like being burried in and around the competition.  Now, for $329 less per month that my previous ineffective 1/2 page ad, I'm able to help my prospective new customers to never have to look inside the book where my competitors are.  I essentially get to make my competition invisible.

OK, so here are some negotiating lessons that you should gain from my this experience.

1.  Never fall to time pressure.  Turn it around and use it to your advantage.

2.  Deadlines are very often not real.  Push them back as often as you can so that time pressure is on your side.

3.  Take money off the table that was previously assumed to be part of the deal in order to get a better deal.

4.  Paint the portrait of pain.  I did this by showing the sales lady how I would take all of my money out of her book and put it in her competitors' books.  She would have lost the sale and her competitors would have gotten stronger.  I was absolutely going to do this.  Be prepared to do what you say you're going to do.  If your bluff is called, that can seriously backfire on you.

5.  Use market data to back up your position.  The power of the written word, especially in relevant statistics, can be a very powerful tool.

Get Hired In Spite of Your Weaknesses

In a recent blog post, Abdus Salam (http://better-jobs-advice.blogspot.com/) points out the importance of being ready for interviewers to ask you about your weaknesses.  He says to be straight-forward and honest.  While I most certainly agree with his point, my response is below.


Great advice. I happen to be responsible for hiring new associates and while weaknesses are important to know about, it's more important to understand that we all have them. If I'm asked about my weaknesses, I'll admit that I need a calendar and task list to be organized, otherwise all bets are off, but I'll also say that with those tools and my other strengths, I'm going to break records. Immediately redirecting to strengths and opportunities is a good way to keep interviewers on-point as to why they would be making a huge mistake not to hire you.



Take a loot at Salam's Better Jobs Advice blog.  It's really good and he makes extremely good points. 

When it comes to getting hired, always, always, always be honest when asked about your weaknesses, but do your best to keep the interviewer focused on your strengths and on the opportunities those are likely to bring to the company.

Negotiating Experience of the Day

Today I had a very nice meeting with a new sales rep for a major yellow pages publisher in my area.  This was a great opportunity for me to sharpen up on my negotiating skills.  So, I made note of all of the tactics she used on me (knowingly or not) and I used my own in response.  Here's what happened.

The tactics she used with me.

1.  Time Pressure - The book was closing tomorrow, so that I would have to decide today.  I did not decide today, so time pressure didn't work.

2.  She told me who else wanted the ad space that I was considering.  This happened to be someone that I know and respect.  So, instead of it making me feel pressure, it made me reconsider purchasing the ad space at all.  Backfire.

3.  She deferred to her higher authority to come up with a price.  I told her she would have to do better than that and get back with me.

4.  She tried to get more and more information from me.  I said as little as necessary because that information was a strength for me and could have been turned into a weakness if I shared it.

5.  She said she could keep the price the same instead of raising the rates in order to convince me to do the deal today.  I said that I might just pull out of that book all together.

6.  She offered to give me free ad space to sweeten the deal and convince me to say yes.  I accepted that with the condition that she would also give me better pricing and then I continued to hold out for a better offer.

What else did I do?

1.  I was completely disinterested.
2.  I was noticeably uncomfortable with the idea of signing another agreement.
3.  I was very quiet causing her to give me more information.
4.  I mentioned that my plan B was to completely stop advertising in her book.
5.  I deferred to my higher authority by saying that my CEO would have to approve anything that I agreed to.
6.  I reminded her of the last time that I pulled $35,000 of annual advertising dollars from her company just a few years ago and spent it at the competition.

My best guess is that first thing tomorrow morning, she will email me and offer all of the ads that I want, including the free ads, and come in at no more than $200 per month more than what I was already paying last year.  If that is the case, then I'll accept the deal after she reduces it $100 more per month.  We'll see.

In Sales, Tell Customers What you Want Them to Do

An understood "rule" of sales is that if you want the customer to do something, you first need to tell them.  For example, if you want customers to call your phone number after seeing it in a yellow pages ad, you should say, "Call Now," next to the phone number.  If you want customers to order 3 or more of something, you should tell them that the price is discounted if they buy more than 3 items.  It you want customer referrals, you ask for the referral and if you want customers to visit your website, you say something like, "visit us online at www.whatever.com."  You should never take it for granted that customers know what they're supposed to do next.  Some people will see your ad and automatically connect the dots and call you or visit your website.  Those people will get to your website and make a purchase.  Others may need a little help connecting the dots with some friendly persuasion.  For those people, you say things like, "call now" or "visit us online at. . .".  If you want something, ask for it.  If you want someone to do something, tell them what you want.  This works and for that reason, it is a well understood sales principle.

HOWEVER, this is not the case with google ads.  I learned recently that you CAN NOT tell your prospective customers to "click the ads".  You can not say this in anyway whatsoever.  Those ads basically have to sell themselves.  I received a friendly message from google and the majority of it is below.  Take a look.

Publishers are not permitted to encourage users to click on Google ads or bring excessive attention to ad units. For example, your site cannot contain phrases such as "click the ads," "support our sponsors," "visit these recommended links," or other similar language that could refer to the Google ads on your site. Please make any necessary changes to your web pages in the next 72 hours. . . If you choose not to make the changes to your account within the next three days, your account will remain active but you will no longer be able to display ads on the site. Please note, however, that we may disable your account if further violations are found in the future.

So basically, advertisers want you to click on the ads.  They are willing to pay  me when you click on the ads.  But, they do not want me to tell you to click on the ads.  You just need to figure that out on your own.  I understand the rationale for not wanting me to tell you to click on the ads.  They want people who are genuinely interested in what is offered in the web sites that you click on.  These advertisers have another huge responsibility once you click on the ads however.  THEY HAVE TO SELL YOU ON THEIR PRODUCT OR SERVICE.  They have to close the deal.  My job is to provide a way for you to get to their site and their job is to make a compelling offer to you that you will find hard to refuse.  They're already qualifying you as a potential buyer by placing ads on my site that are somewhat relevant to my blog's topics.  That's a great idea!  Knowing that I have qualified viewers on the blog page where I'm advertising, I would want me to tell you to click on the ads because I would want the opportunity to make you an offer that you can't refuse.

With all of that said, Google's ad policies are what they are and bloggers like myself must adhere to them.  So, in the future, I won't be telling you to click on the ads.  Instead, you'll just have to see them and do whatever you feel compelled to do.  Regardless, don't forget the very well understood principle in sales:  tell customers what you want them to do if you want them to do what you want.

Negotiating Tactics

These are some of my favorite negotiating tactics.  Tactics are things that you say and do to help the other side do more of what you want them to do. 

1.  Fear of Loss.  Show someone how not choosing your product or service will damage their position.  For example, if your product has been proven to help businesses make $10,000 more each month, you might say something like, "It's going to cost you $120,000 per year NOT to do this deal."

2.  Time Pressure.  I personally hate when people do this to me.  Here, you make it clear that the current good deal will go away after a certain date - "This deal's good thru the end of the month."  "If we can get this done today, I can knock off an additional 10%."  Another way people use time pressure is in renewing contracts.  I find that advertising sales people won't contact me to find out if I want to renew my ads until about a week or so before the supposed closing date.

3.  Walk Away Power.  This is a good counter-tactic for time pressure.  When someone says you only have a week or a day (or whatever) to get this done, I'll often tell them nevermind.  Don't succumb to time pressure and other negotiating tactics if you don't have to.  Walk away power can be powerful.  You can always come back to the negotiating table if and when circumstances change.  You're never back into a corner unless you put yourself there.

4.  Show people the net positive value of their good decisions.  If something will cost $1,000 up front, but then bring in $5,000 more, then the net positive gain is $4,000.  When people see what's in it for them, and financial gain is a huge motivator, they will usually agree to a deal.

5.  Show shock and disbelief.  When someone makes an offer to you, no matter how good it seems to you inside, you should show disbelief that they would consider such a bad offer.  To really sell it, you need to look noticeably disturbed for a while after the offer.  Many times, the opposition will modify their offer out of fear that you might walk away.

6.  Isolate points of agreement.  Once both sides agree on what they already agree on, it makes it much easier to break down the remaining points of disagreement.  "We already agree on the color, the quantity, and the base price.  Now, we just need to work on leasing terms and a fair final payment amount."  This prevents the deal from being clouded up unnecessarily and allows you to negotiate the remaining points individually.

7.  Break prices down to their absolute smallest points.  For example, if you are trying to get someone to pay you $12,000 per year for your services, tell them that it would only cost $33 per day.  Then of course remind them of their potential benefit which could be $48,000 per year or 4 times their investment.

8.  Calling people out on their tactics.  This usually will make them feel silly and embarrassed for trying to use negotiating tactics on you.  For example (and this happened to me once), if someone tries using the "good cop, bad cop" tactic on you where one of them is on your side and friendly, while the other is more aggressive and abrasive, it's funny to call them out on it.  I stopped the conversation and said, "wait a minute - is that good cop, bad cop?  I'll do this deal for the amount I originally stated or not at all.  What's it going to be?"  Winner - me!

Schizophrenic Economy?

Bloomberg Businessweek's August 2nd edition has an article about "The New Abnormal" economic climate.  It talks about Americans who are cutting back on some things, but splurging on others.  During a time of nearly 10% unemployment and foggy economic uncertainty, many people simply don't know what to do.  People worry about losing their jobs and about not being able to pay the electric bill.  Others are cutting back for that just-in-case situation, while some are cutting back in areas so that they can continue to spend in other areas.  The Dow hits extreme highs and extreme lows.  Economists can't seem to agree on the outlook in the short term or the long term.  News outlets are so politicized that the average person can't tell the difference between the truth or variations of the truth.  Instead, they blindly rely on MSNBC and Fox News to set them straight.  Record numbers of people are out of work and the news media focuses more on the 10% unemployed than the 90% still employed.  Train wrecks make the news.  That's just the way it is.  Now, the country is waiting and hoping that things will soon turn around, and they will turn around, but everyone is going to have to adapt and adjust.

Businesses that have down-sized are not going to just instantly increase staffing numbers because the economy turns around.  Instead, they are going to try as much as they can to get more efficient and need less people.  They are going to get more efficient in every area possible.  At the same time, people will need to adjust and adapt to their situations. When we get a raise or a promotion, we tend to adjust our lifestyles up.  Well, this will be necessary too when we need to adjust down due to pay cuts, demotions, lay offs, and terminations.  Everyone is going to have to adjust and everything is going to be uncertain for a long time to come.  It's not economic schizophrenia.  It's just shock and adjustment, but it's going to be OK.

This is an opportunity to teach young people to be smarter with their money.  Teach high school kids financial and entrepreneurial skills.  Mandate finance classes for all college students - not just literature, algebra, govenerment, etc.  Make extern programs mandatory for all college degrees.  This is very successful in the healthcare fields.  It's free labor for business and on-the-job training for students.  Teach business ethics to young people today to prevent Enron and Worldcom tomorrow.  Teach people how to make personal budgets and avoid future credit crunches.

This is an opportunity.  We need to make the best of it.

What's Wrong With Generations X and Y?

I just attended a business conference with the most intelligent and highly educated speaker I think I have ever heard.  His name was Dr. John Howard, MD, MPH, JD, LLM.  I leaned over to my co-worker and told her that he was "the smartest guy in the room" by far.  He had some very interesting statistics about the make up of the workforce in this country and about where that make up was expected to go in the near future.  The thing that really didn't sit well with me was his facts on the Generation X and Generation Y portion of the workforce.

From 2000 to 2010 there was a 9% drop in the number of workers ages 35 to 44 (Generation X).  This is expected to continue thru the year 2020.  During this time, workers in other age categories will increase.  What the heck!

Generation X is made up of people born between 1965 and 1980, followed by Generation Y (born 1980-2000).  In the study presented by Dr. Howard, from 1992 to 2002, Generation X'ers desire for jobs with greater responsibility fell from 69% to 54%, while Generation Y's desire dropped to 60%.  So in other words, those in Generation Y are demanding higher level jobs at a higher rate than Generation X (although not by much).  And, this decline happened during the '90's.  What happened in the '90's that caused the younger generations to lose the motivation and drive for jobs with higher responsibilities?  And, why is it worse for Gen X than Gen Y?  What's wrong with responsibility and with being in charge?  These positions set the standard for business.   They set the rules of business.  They are some of the change agents of the world.

I'm a little frustrated that the younger generation is more likely to be my boss in the future than I am to be theirs (statistically - I'm definitely not in-line with my generation).  Now, look at these next figures.

According to this study, Generation X values are less aligned with the organization than any other generations (of the 4 generations since 1928).  Even Generation Y is more highly aligned with the organization's values than X.  Gen X is also near the bottom (very closely followed by Gen Y) when it comes to caring about the fate of the organization. 

What in the world is going on with people born between 1965 and 2000?  And, are we passing on this apparent apathy to our kids?  With this much apathy, it is my opinion that the "cream will rise to the top".  That's why those of you reading this need to be aware and take action.  Be more motivated than the average Gen X'er and Gen Y'er.  I think there is real opportunity for the 30 and 40-somethings to get into positions of authority and make a difference.  Get into the top of the class (so to speak).  That doesn't appear to be too hard unfortunately.  Take some initiative.  Don't be part of the 9% drop in workers from our generation over the next 10 years.  And if you can't get aligned with the values of the organization, then by all means, start your own!  Do something!

I hope that reading this makes you feel unsettled just like it does me.  My business conference had a lot of other information in it today, but the rest of it was a very distant second compared to Dr. Howard's presentation. 

Let's reverse this trend.

10 More Tips for Negotiations

This is part 2 in my series on negotiations.  These 10 tips will be helpful in any deal-making situation.

1. Always tell the truth.  If the other side ever catches you in a lie or finds that some "fact" you used to support your position is not accurate, it will sabotage your position completely.  If I find that someone misleads me, lies to me, or uses inaccurate information, I'll be a broken record on that point as often as possible to get a better deal.  My feelings will literally be hurt (as far as the other side knows) and I'll use it to my advantage.  Always be accurate.  Always tell the truth.

2. Dress like a person who is successful.  When you appear successful to your adversary, they will (often unknowingly) give you more respect.  Men - wear a dark suit, light colored shirt and a tie with red in it.  Women - wear a dark colored suit or dress.  Get a haircut.  Wear appropriate makeup.  Shave.  Use nice cuff links.  Shine your shoes.  Be the best dressed person in every meeting.  Dress like the deal is unimportant and be prepared to lose.  Dress for success and have success.

3. Put your information in writing.  People generally believe things that are in-writing.  Use charts and catchy headlines.  If you're product saves businesses thousands of dollars per month, show the other side the average dollars saved monthly.  Put it in writing.  If your customers are overwhelmingly and enthusiastically satisfied with your services, put their satisfaction scores in writing.  This will be far more powerful than just verbally saying so.

4. Cite your experts.  Tell people who else uses your services and who else recommends you.  This can be anyone in positions of authority.  Mayor, council person, doctor, lawyer, CEO, pastor, etc, etc, etc.  Anytime you can cite the strong opinions of a (even perceived) expert, you will be in a position of strength.

5. Get people to commit to things verbally and publicly.  Generally, when a person says something out loud, especially to a group of people or to someone they respect, they will be inclined to back that up with their actions.  For example, if you can get a potential client to tell a group something good about your product, he/she will be more likely to back that statement up with a purchase.

6. Make yourself well liked.  Try to use charisma.  When people like you, they are far more likely to do what you want and expect.  If you want someone to buy from you, you have a lot better chance if they like you than if they don't.

7. Never get angry.  Negative emotions are deal-killers.  He who gets angry, loses.

8. Put your strongest arguments either at the beginning or at the end.  These are the most memorable points of any presentation.  Putting them at the beginning can set the potential client up for agreeing with everything else you have to say.  Putting them at the end leaves the potential client with a strong feeling that will be hard to forget.  The very best thing to do is put your strongest point in the beginning and then reiterate it at the end.

9. The Power of Golf. The reason so many business deals are done on a golf course is because golf can be such a pleasant distraction.  When the buyer / client is in a positive frame of mind, a deal will be more likely.  It doesn't have to be golf.  It DOES have to be whatever the client finds to be a positive experience.

10. Always tell people what you want or expect.  If you want them to buy something, you have to say so.  If you want a better price, you have to say so.  Tell people what you want.  This is the very best way to get it.

High Dollar Negotiating Tips

This will be the first in a series I'm going to be writing about negotiating.  Negotiating isn't just important in business.  It's also valuable in your personal life.  When you are talking to your kids, you're negotiating (even though they may be winning).  Dealing with your spouse can be a process of negotiation.  When you're purchasing something, it's a negotiation.  Business deals are full of negotiations.  Buying a house, or a car - serious negotiations.  So, this is a topic that really affects everyone, and that's why negotiation is my favorite of all business topics.  In this blog, I am going to give some helpful tips in negotiating.  Later, I'll talk about some specific negotiating tactics, preparing for a negotiation, closing the deal, and more.  So, stay tuned.  For now, here are some helpful tips to think about in any negotiating situation.

1.  Be prepared.  This means that you should know about the person or business you are going to be negotiating with.  What are their "hot buttons"?  What do they want?  What problems are they experiencing?  What problems can you help them solve?  What weaknesses do they have?  What weaknesses do you have?  How do you hide those?  How much do you want to pay and how much are you actually willing to pay?  How much do you want and need to get paid?  You need to spend an adequate amount of time preparing for whatever deal you're working on.  This is the first and most important part of any successful negotiation.

2.  If you're planning on making the first or opening offer, it needs to be very high or very low depending on what's best for you.  For example, if you're trying to purchase a piece of real estate and you know the market value of the property is $100,000, you might want to initially offer $85,000.  It seems like a ridiculous offer considering the market value, but this prevents the seller from coming out of the gate with a ridiculously high offer like $125,000.  You're anchoring the sales price at or below the market price and that starts you out in a strong position.

3.  Never fall in love with a deal.  You must remain objective and keep your options open, including the option to simply walk away.  The purpose of a negotiation is for you to get a good deal.  Don't sabotage yourself by losing objectivity.

4.  Always say "no" to the other side's opening offer.  They are trying to anchor the deal in their direction anyways, so don't say "yes" yet.  Make them work for it.  Even if you like the deal, you don't love it and you are going to say "no".  This will get you a better deal every time.

5.  When the other side makes the opening offer, be shocked at their offer because you can't believe they would offer such a bad or one-sided deal.  Then wait for them to cave in and make a better offer.  Always say, "you have to do better than that".  Even if you like their opening offer, be shocked and tell them to do better.  It will work most of the time.

6.  Only give up something if you get something in return.  These are concessions and you can't concede if the other side is unwilling to do the same.  Because you did your planning in advance, you already know what things you would be willing to concede and what things you want.  If someone says they need you to drop the price by $5,000, (after you look shocked that they would ask such a thing) you tell them (very reluctantly) that "I might be able to do that, but I would need you to pay 40% up front instead of the original 25% that we talked about before".  Always get something of value in return for giving up ANYTHING - regardless of that thing's value to you.

7.  Never offer to split the difference.  That is your opponent's job, not yours.  If the other side wants $100,000 and you want to pay $80,000, don't offer to split.  However, if the other side offers to split the difference, then you're in a very good position.  That means they would now be willing to accept $90,000 and you're only $10,000 apart instead of $20,000.  From this point, you would say, "wow, you'd be willing to take $90,000?  That's great because now, we're only $10,000 apart.  Surely there's a way we can get this deal done since we're so close on price."  If you end up paying $87,000, you're in better shape than if you would've offered to split the difference.  Because then you might have ended up at $93,000.  You just saved yourself $6,000!  Great job!

So, that's quite a bit of information for you to soak up for now.  Try this stuff out.  It's amazing how well it works.  Practice, practice, practice.  Have fun with it.  What's the worst thing someone can say to you?  "No"?  So what.

Stay tuned for more High Dollar Negotiating Tips.

You're Worth It!

Have you ever taken the time to just think about what you put your time into?  If so, spend some time comparing it to the things that you want - in life, in work, financially, family, etc, etc, etc.  How does the time you spend compare to the things you want?  You need to realize something very important:  You're going to get exactly what you're willing to put your time into.  So, where are you spending your time?

I want to be (for lack of better words) a famous management guru.  I also want to someday win a million dollars in a world class poker tournament.  I want my kids to be crazy smart and be more successful that I dream of even myself being.  I want my wife to think and say nice things about me when she thinks of me and talks to others (and I want her to mean it).  All of that stuff takes work (TIME).

What do you want?  Maybe you want to make more money.  Maybe you want to make A LOT more money.  Or, maybe you want to be a better cook, or a better student.  Maybe you want to be a better hunter, better coach, better mom or better dad.  You just might want to be better than the person in the office next to you.  OR - Maybe you want to be the best at something.  (Yes, I know - I've made my point.)

Personally, I think you should want to be the best at something.  I sure do.  I want to be the best at everything that I do.  Well then, figure out all the other places you're wasting your time and re-allocate that time to the things you want to be best at.  Then, work at being the very best in the world.  Don't sell yourself short either.  Believe me, you can be the best at something.

I'll get you started.  This is so easy - I promise you that you can get this done. 

Step 1:  Write Down Exactly and Specifically What You Want to be THE BEST AT.
Step 2:  Write down 5 or 10 ways you can make that happen.
Step 3:  Never, ever give up until you've accomplished your goals.
Step 4:  Give yourself a way of knowing when you've accomplished your goals. 
Step 5:  Reward yourself for getting it done.

Also, be reasonable.  Look, I want to be President of the United States, but they're not going to let that happen.  I also want to be Free Safety for the Dallas Cowboys, but I can't list all the reasons that's not going to happen.  However, I do want to make $350,000 per year.  I can make that happen, so I'm working the steps.  I do want to be on the cover of a business-related magazine.  I can make that happen too, so I'm working the steps.  I'm just putting the time in that it takes to get this done.  It's hard work, but the payoff is going to be huge.  And, I think I'm worth it.  And, so are you.

Finally, if you find yourself reading this and telling yourself reasons you can't do what you want, or reasons you can't have success in areas that I think you should, then stop it.  Start back over at the top and try again.  Don't shut yourself down.  There are plenty of people out there who will try to do that.  Don't help them.  Lots of people are going to tell you that you can't do stuff.  That's OK.  They're wrong anyways.  Don't make it true by buying into it.

For lots of people, this requires a complete paradigm shift in their lives, but you know what?  Make that shift.  Don't sell yourself short.  You're worth the success that you dream you should have and it's not too late either.  Carpe Diem - "Sieze the Day!"  Sieze it every day.

Are You Breaking Records or Nearing Disaster in Business

If your business was nearing disaster, would you even know before it's too late?  How would you be allerted to serious problems?  Would you rely on an employee to tell you?  Do you think your competitors are such good friends that they will give you a head's up?  Or, would you need to sort through piles of reports to find problems?  You need a systematic approach for identifying potential problems before they become total nightmares.

On the flip side of that, you also need a way to measure success and break records.  Although it feels good, and it certainly sounds good (at least to you), you can't just go with your gut.  Again - reports:  who has time and if you make time, will you really know what you're looking for?  Will all of the pieces make enough sense that you can do something valuable with it?

I can come up with hundreds of more questions just like the ones above, but the answer is somewhere else all together.  For those of you who were reading my blogs back in 2009, you will remember one called, "Record Breaking Business Tracking Systems".  http://chelmsmba.blogspot.com/2009/02/record-breaking-business-tracking.html  THIS IS THE ANSWER.

These are charts of graphs, often referred to as dashboards, that give you up-to-date reporting that will save your butt and make you a business hero.   With these dashboards, you will track everything that you would otherwise need a long report to figure out.  Someone will report the data and enter it into a simple Excel spreadsheet and the graphing add-in program will create your charts.

Here's the really important reason to use tracking systems.  When you see a drop in production and it lasts 3 weeks, you don't need to wait until 3 months to recognize it and solve the problem.  By then, it could be too late.  If you track new customers and you see that total new customers drops by 3 per week for the last 3 weeks, you give yourself a chance to turn it around before it gets totally out of control.

On the other hand, when something is working really well and you see the graph jump to a new high range, you get an opportunity to figure out how it happened and reinforce what works.

THESE TRACKING SYSTEMS ARE ABSOLUTELY CRITICAL TO BUSINESS SUCCESS!

You may be saying to yourself, "I get it, but I don't need graphs, besides it's just Excel.  Big deal."  You better believe it's a big deal.  It's the single biggest deal I know of to positively affect business growth.  Go back and re-read by previous blog about business tracking systems, then put some serious thought into the following question.

By how much do I want to beat my competition?

Promotions happen from growing the business and beating the competition.
Raises come from growing the business and beating the competition.
Recognition for being a great manager comes from growing the business and beating the compeition.

If you want help setting up your Record Breaking Business Tracking System, then I want to help you.  Contact me and we will work something out that makes sense for you.  I've written the manual on how to create these systems (literally).

Don't Lose Money

In the early part of 2008, I began reading a book called, "Rule #1" by Phil Town (see below).

THIS TURNED OUT TO BE A GREAT BOOK!  In his book, Town lays out a simple strategy for investing.  Well, as I was reading, I decided to create an Excel spreadsheet and try to apply the formulas that he teaches for evaluating, buying, and selling, stocks.  This spreadsheet was really just to test out the book - to see if it really worked.  Since I wasn't sure yet, I DID NOT INVEST MONEY IN THE STOCKS THAT I EVALUATED USING THESE FORMULAS.  Mistake?  Read on.

I evaluated several stocks, but eventually narrowed my list down to 10 finalists.  They are listed below along with their stock price as of March 13, 2008.

Apple - AAPL                             $122.25
Amazon.com - AMZN                 $68.32
Dell Inc - DELL                           $19.85
Microsoft - MSFT                       $28.62
Wal-Mart - WMT                        $50.60
China Mobile LTD - CHL            $70.72
Qualcom - QCOM                       $40.25
Best But - BBY                            $40.61
Tradestation Group, Inc - TRAD  $10.04
Cisco Systems - CSCO                $24.95

Since March 2008, I think most people understand that markets around the world went into the tank.  With that said, if I had purchased those stocks and then sold them at their high point in the last 52 weeks, 7 out of the 10 stocks above would have made money.  Apple and Amazon could have made me rich.  The 52-week highs for those stocks were:

Apple - AAPL                                      $279.01

Amazon.com - AMZN                          $151.09
Dell Inc - DELL                                    $17.52
Microsoft - MSFT                                $31.58
Wal-Mart - WMT                                $56.27
China Mobile LTD - CHL                     $59.22
Qualcom - QCOM                               $49.80
Best But - BBY                                     $48.83
Tradestation Group, Inc - TRAD           $8.89
Cisco Systems - CSCO                        $27.24

So, for every dollar I would have invested in these stocks (including the losers), I would have made .51 cents profit.  That's a 51% return on investment (ROI) or put another way, a 25.5% ROI annually.  Where else can you get that kind of return?  Some might argue that the answer to that question is Gold, but that's another story all together.

This process doesn't happen without some work, but I'm eventually going to take the steps to evaluate more stocks based on today's financial situation.  I wouldn't do it without this book though.

By the way:  Rule #1 is "Don't Lose Money".

Take a Chance

This is a topic that I have really struggle with - Taking a chance.  I've found myself having a fear of failure or a fear that people won't like my stuff.  I wrote this book, "Record Breaker" LAST YEAR.  I literally finished it 1 year ago, but I delayed doing anything with it.  That started weighing on me because I knew I had that unfinished project.  Then one day I was talking to a friend who said something that finally helped me get past myself so that I could do something successful.  He said:

How many people do you know?  How many people have you ever known?  A thousand?  More?  How many of those people ever wrote a book?

You know what?  I only know one other person who ever published a book and he's a PhD.  So that energized me.  Now, I have a meeting with a printer in 2 days.  I can't wait to get this project finished up.  Even if I never sale 1 copy (and I plan on selling out), I published a book and that makes me 1 in 1,000.

I'm taking a chance.  I'm getting past myself and my irrational fears and doing something that will be successful.  What are you holding yourself back on?  What big ideas do you have that you haven't followed thru to completion?

I think everyone should take their chance.  Be 1 in 1,000.

15 Car Buying Tips to Keep you From Getting Hosed

1. Shop around to see what other dealers and private sellers are selling cars for.  Get a working price range before you talk to any sales people.

2.  Have a list of car choices.  Don't put yourself in a buying corner by limiting yourself to a single choice because. . .

3.  Don't fall in love with a car.  If you fall in love with a vehicle, you will lose objectivity, and you will get hosed.

4.  When talking to a salesman, be disinterested in even doing the deal at all.  In fact, be a little uncomfortable with the whole idea of changing cars because you are. . .

5.  In love with your current car.  It's going to be tough to get you to trade up or out of your current car.  Let the salesman see that for you, buying a car is not an emergency.  You're in no distress.  You can take it or leave it and you know what?  You just might want to leave it since you love your car so much anyways.

6.  Handle only 1 deal element at a time.  Deal elements include:  total sales price, financing / interest rate, monthly payments, trade-in value, and the kind of car you might purchase if you do the deal.  Start with the total sales price of the vehicle and don't move off of that subject unless or until you are satisfied with the price.  No deal is good if it costs too much.  So forget monthly payments, interest rates, and trade-ins.  There's plenty of time to get to that because. . .

7.  You are willing to close the place down if that's what it takes.  What time does the dealership close?  9pm?  That's OK.  I cleared my schedule so I can take as long as it needs to take.  By the way, would you be helping those people over there if we were already finished up here?  Make the salesman uncomfortable about losing the commissions from all of the other customers he could be helping if he would just quit giving you the run-around.

8.  Know your credit score and debt to income ratio before going to a dealership.  Remember, financing is irrelevant to you until the other deal elements are worked out anyways.  When you know how good your credit is, you'll already have a pretty good idea of how good of a financing deal you are going to get.

9.  Make them show you the Black Book.  I know this thing exists, but has anyone ever seen it besides the dealers.  I had a guy tell me that they don't use Blue Book values.  They use the Black Book.  So, I said, "fine, bring me that book so I can see it too."  For some reason, he agreed to my price instead of showing me the book.  I thought that was interesting.

10.  When the salesman starts to make too many trips up into the manager's office, just demand to talk directly to the manager.  You don't need a middle-man to get this deal done.  That middle-man's not on your side anyways, so try to get rid of him and go straight to the decision maker.

11.  Make a ridiculously low offer to get started.  If you know the average sales price of a particular vehicle is $20,000, then offer $15,000.  This anchors the negotiated price range lower and certainly closer to the average sales price.  Otherwise, the dealer is going to start high and then you'll be forced to work too hard.  Make the dealer work instead.  And if the dealer makes a ridiculously high offer, let him know that it's ridiculous.  Don't be scared to speak your mind.  It's your money.

12.  Never offer to split the difference - ever.  That's the dealer's job  You're not willing to settle for the difference anyways, so don't bother.  However, if you want to pay $18,000 and the dealer is stuck on $24,000, but offers to split the difference, then guess what?  The dealer's new number is $21,000 (splitting the difference of $6,000 lowered his price to $21K).  Now, you're only $3,000 apart and you say, "well, we're only $3,000 apart from what I want to pay and what you're willing to accept.  Surely there's some way we can make this deal work."  You'll probably end up paying $20,000, but you only had to go up $2,000 and the dealer went down $5,000.  That's a success!

13.  Be ready and willing to walk away.  You're not in love with a car and certainly not with the deal.  So, when you hit an impasse, just walk away.  This is very powerful because believe me, they don't want that, especially after you've spent the last 3 hours of his time working a deal only for him to lose it along with all those other customers he couldn't help because he was giving you the run-around.

14.  Be reasonable, but keep it to yourself.

15.  Recognize the right deal when it presents itself and take it.  At some point, the dealer has really done all that he can.  You need to recognize that and make a decision.

Metric Decision Making

One thing that I've come to understand about management is that it is far too easy to get caught up in emotions and "gut feelings" and when decision making comes from those things, it's very easy to get it wrong. Take firing someone as an example. I'm a top manager and as such, I've had more than my fair share of people who have taken shots at me. I've been insulted and undermined. I've dealt with passive aggressive individuals who were smiling to my face and stabbing me in the back. I've even worked with plenty of people who I just didn't really like very much. I can't just fire everyone that I don't like or who doesn't like me. Sure, if I give a directive to someone who understands and agrees to my face, but sabatoges me or my business when I'm gone, I'm absolutely going to send that guy packing. We need our team members to act like team mates and not like enemies. I think that's pretty well understood.

It's the emotional things that I really want to focus on though. If you don't particularly like someone, you might just have to get over it. Number 1: we dont make decisions based on likes and dislikes - period. Number 2: what if you get rid of a top-performer based on something personal and/or petty? What if you don't even realize that person is a top-performer? What if you don't even know what would define a top-performer? That's a serious problem.

You need metrics to help guide your decisions. You need to know how your employees perform compared to other employees in your company and to other people in other companies within your industry. This starts by knowing how your company performs compared to other companies. Do you know how much revenue each of your employees should generate in a work day. Do you even know how much they are generating at the present time? If not, that's a problem. You need to figure this out.

What about ratios too? Do you know how many people it takes to run your operation? Well, how many customers does each of your employees help per hour? 1? 2? 10? How many dollars does each of your employees generate? How many dollars per hour? Now, what if you don't particularly like someone because your personalities seem to always clash or because that person doesn't seem to want to do things "your way"? What if that person generates $1,000 per hour compared to your average employee who's doing it "your way" and generating $750 per hour? If that's the case, I think it's just about time for you to suck it up buddy.

Your not going to make decisions based on emotions and gut feelings when you can do a little work and find out some really solid metrics to help guide you. Without those metrics, you're going to lose someone who outperforms the rest of your team by 25% when you should be looking at the guy who produces $350 per hour instead.

This way of thinking will save your butt over and over again. It will help you decide which customers to dedicate most of your time to and which customers to stop spending time with at all. It will show you which products are selling the best, even if you don't particularly like them (which won't matter with metrics). As I've clearly shown you here, it will help you make smart hiring and firing decisions so that you don't lose valuable people and poor-performers. If you use your own numbers and compare them as many ways as you reasonably can, you'll be around a lot longer to keep making those smart decisions.

Metric Decision Making > Emotions & Gut Feelings.

Relationship Marketing

Everyone has heard the saying, "If it was fun, it wouldn't be called work". Why does that need to be true? The #1 job of a business is to get new customers. That's pretty fun isn't it? It can certainly take hard work too. Relationship marketing guarantees that the job of getting new customers gets to be fun. It's fun because you begin developing a network of marketing friends to work with every day. Who doesn't want to spend every day working with their friends?

The other thing about working with your friends is that friends usually want to help each other out. I know if I have an opportunity to help a friend, I'm going to do it every time. In marketing, working with friends can and should mean being able to share business referrals and contact lists among friends. If I know 5 people (friends) that could work well with my other friends, then I'm going to introduce those 5 friends to my other friends, and all of those friends would do the same thing for me. These friends get to know those friends and I get to know the friends of those friends, and then we all figure out how we can help each other because we are all friends now and we all want to help our friends while those friends are all helping us.

I know many of you reading this are saying to yourself, "but this is just networking, it's not a new idea." I agree that it's not a new idea, but you would be shocked to find out just how many people aren't thinking about it. I've had an opportunity to present this idea to some of my friends lately and most of them had not thought about it in this way before. I'm offering to do 2 important things for them: 1. I'm offering to do business with them myself. 2. I'm offering to open up my rolodex to them so they can develop business friends with people they never knew before. The key thing here is that they aren't having to do any cold-calling. Instead, they get to pick up the phone and honestly say, "Chris Helms told me I should talk to you." And, because it's a friends of mine, the answer will just about always be YES because friends like to help friends.

In exchange, I get access to the rolodexes of all of my friends, then eventually to all of their friends' rolodexes as well. It's so much easier to do business with friends than with complete strangers. So, create friend-business relationships and do business with your friends every single day. The first step is to share this idea with your friends and get them on board. Next, exchange rolodexes and get to work.

Who are your current friends that you work with? Which of those friends could help some of your other friends? Start thinking about and referring to your current business contacts as business friends. Then, build that relationship up accordingly. Go out with your friends to do some joint marketing to your list of contacts and theirs. If we all help our friends and all of our friends help us, then we will have an exponentially greater opportunity for success.