Archive for the ‘Flexibility’ Category
It’s become quite clear to me that I’ll never fit all I want or need to say about the business of Linux in my LinuxCon talk. In fact I could make it a full day workshop and still not cover everything there is to know about making money on products your customers can get for free.
The solution is to begin evaluating what information really needs to be in the presentation and what would be better here. In some cases I’ve begun shucking slides from the deck and for others I’ve decided that there needs to be a better explanation of what I’m trying to cram into my allotted time.
With today’s post I’m going to start addressing some of the topics that could use a little more depth than what time will allow. I also hope that by exploring the topics here I’ll have a better grasp on what is most important to convey when I stand at the front of the room next month. ~Karlie
Midmarket Companies are the Key
Less than a month ago, eWeek published an article titled “Midmarket Companies Steady on PC Purchases, Report Finds.”
This article is based on The NPD Group’s Small and Medium size Businesses (SMB) Technology Report.
As you can guess from the name, the midmarket is made of up of companies who sit right between Mom-n-Pop operations and big businesses. They’re generally smaller than 500 employees and actually make up most of the US economy.
The first bullet on the slide above is fairly easy to understand – Buying is going up this year. While that’s good news, it’s the next two that set my heart all a flutter. They show me some really good numbers – Let me explain.
The biggest reason I’m in a very good mood following this report is that the percentages give me a starting point for basing a financial model off of.
Yes, 40% is less than half, and on first look can seem sort of dismal. The thing we need to understand is how big that 40% could really be.
According to the US Census Bureau, there are nearly 5 million businesses with 499 or fewer employees. So if we do a little math, 40% comes out to be approximately 2 Million potential clients. It could be even more if you set your pool to include business with over 500 employees.
We also need to factor in that the estimated market share for Linux is just about 1%. If we assume the market share is the same with SMBs, we’re looking at about 20,000 firms to get your feet wet with.
I’d also go out on a limb and suggest that if SMBs began adopting FOSS technologies that 1% market share for Linux would rise rapidly. How far? I don’t know exactly, but for every percentage point it jumps you’d be looking at another 20k or so in your national customer pool.
The lesson here is not to get hung up on what constitutes big or small in the business world, or even take a percentage at face value until you understand what those numbers actually represent.
20-Thousand businesses may not seem like that many either, but could you handle that many clients? Probably not while you’re just starting out, so 20k is really a fairly large number for you to grow into… Especially if you can grow the Linux adoption rates while you’re at it.
So here’s another general response that pops up all the time when I’m counseling at SCORE.
The question is usually something like “Is $1400 too much to pay for a 5 page website?”
So my answer is usually something like this…
If I knew more about the type of business, the better I could tailor my response here, but in general, you’ll want to go Open Source.
Open Source software is publicly licensed. It’s underlying code is open and available for modification and to top it all off, it’s usually been tested and tweaked a thousand times before you use it so you’re less likely to have problems or need support contracts.
Also, if you find something that’s close enough to what you want your site to do function wise, you’ll only be paying a professional to shine it up for you. So instead of months of custom code that will need complete bug testing you’ll be looking at a week or less to get things up and running.
You’ll also need to think about the site in two ways… What’s behind the scenes managing content, catalog and check-out process – usually the database portion of the website and your admin panel. Then how that data feeds out into your site.
The good news, the graphical layout is really a minor detail once the back end is working properly.
You’ll usually have a template of some sort (Cascade Style Sheet – CSS or XML) for the graphical layout with snips of code to indicate where the various components go. Menu on the left or the right – no problem. Don’t like the colors, again, no problem. Simply tweak the style sheet and all your information will fill in just where it’s suppose to go.
Every page will have a similar look and feel while allowing you lots and lots of dynamic space for content.
You might even be able to find an open source template that you can modify to suit your needs.
For instance, http://on-disk.com/ is http://demo.oscommerce.com/ We have modified the code and the database to meet our needs, but the sky’s the limit on graphical modifications. We’ve kept somethings the same, but there’s no need to be stuck with anything.
Another example is Webpath.net The back end is a custom wiki/blog hybrid that we created a long time ago, but the layout started out as a free template called Invention. I liked the general layout, but wanted it co-branded to the On-Disk.com website so the color scheme and graphical elements needed a quick change. All in all, the updates took about an hour to complete and most of that was time I spent looking and deciding if I liked it or not.
But these are just examples. You’ll have lots of choices with Open Source Shopping carts, Content Management systems and loads and loads of templates to choose from.
Just think of your business functions in Must, Should and Can features. Knowing what you need will help you sort through options as you research components for your site.
What must the site do from the beginning? What should be included in phase 2. What can we integrate now for future upgrades so that we don’t have to re-write the code?
Have I overwhelmed you? In any case, let’s stop here for now. Comment with questions.
This morning I was asked if forming a business partnership is the right move when a small business owner doesn’t bring all the necessary skills to the table. I’m always a bit nervous about partnerships, so I used my standby response…
The leading cause of divorce is money. With business, you don’t even have love to keep you together.
I quickly finished my response to the client and then popped open my spankin’ new blog* with the prospects of writing my first official post. The problem is, I didn’t know if I’m actually right about causes of divorce. Conventional wisdom seems to agree with me, but now that I’m a faux journalist, I should probably find a credible source… Shouldn’t I?
A quick trip to Google brought me to an article by Liz Pulliam Weston titled “Money isn’t the culprit in most divorces.”
The title of the article does seem to indicate I’m wrong. However, the body presents a valid argument showing that I’m not that far off the mark. So while I don’t have a straight answer about money being the root of all evil it does give me cause to modify my thinking and the way I’ll format this portion of future SCORE counseling sessions.
So if the question is, “Is a partnership right for my business?”
My answer will be, It depends.
While you might be friendly towards one another, have complementary skills and a little bit of money to bring to the table, you need to be very cautious. Becoming business partners is equivalent to marrying someone.
- You will spend more of your time with the partner than you will with your spouse.
- You will be splitting any money you do make with the partner.
- If the relationship goes bad, they can walk away with a significant portion of your business — maybe enough to cause the business to fail.
If you still think a partnership is right for your business, you shouldn’t do anything until you have a signed partnership agreement. I really mean that. Until such time as you have an agreement in place, if they’re working in the business you have an employee. If they give money to the business then they are an investor.
The partnership agreement should be reviewed by your attorney and should cover everything you can think of.
- Who owns what share of the business?
- Where do your shares pass should something happen to you? Accidents have been known to happen. If something does, do your shares transfer to your next of kin or the partner?
- How do you get out of the business or remove a partner? Situations change, so be flexible.
- What jobs will each of you be responsible for? Be thinking about “Too many cooks spoiling the broth” vs. “Many hands make light work.”
*Editors note 1-24-10, This article was imported from karlierobinson.blogspot.com a general topics blog and KarlieRobinson.com is the new “new blog” devoted to business topics.