How to Win on the Web

Information for
RBC Bank
Clients
How to Win on the Web
The fundamentals of football are blocking and tackling. It’s silly for a team to work on other things
before it has the blocking and tackling down cold.
®
The fundamentals of website marketing are architecture, content and incoming links. Spending time
or money on anything else is a waste unless and until you:
a.know all you need to know about how to optimally design a website for maximum search engine
optimization (SEO), and
b.have designed your site — and are continually updating and maintaining your site — in
adherence to SEO “best practices” for architecture, content and incoming links
For most business owners today, this is not just about your website. It’s about the ongoing success of
your business. The very survival of your business.
The playbook for the game of business has changed. In the age of the Internet, teams win and lose
based on, in whole or in part, their ability to execute on the Web.
The first and foremost essential of Web execution is getting ranked highly for relevant keywords by
the main search engines (Google, Yahoo, Bing). Search engine rankings are driven by three things:
architecture, content and incoming links. So winning web strategies are build on these three.
Nothing more. Nothing less.
Architecture
This is about how the site is programmed and built. Search engines rank
pages based on their relevance for certain keywords, and page titles, meta
descriptions and URLs are given higher levels of importance than the
words in page text.
Content
In the age of the
Internet, teams
win and lose based
on, in whole or in
part, their ability to
execute on the Web.
Does your site offer any information or tools that are unique? Helpful?
Insightful? Interesting? This is referred to as content. Search engines
provide people with the information (“content”) they want to find. To begin winning the search engine
game you need to develop unique, relevant and authoritative content in the area of your focus.
Incoming Links
Search engines give higher rankings to websites and/or Web pages that are popular. Popularity is
gauged, in no small part, by how many other relevant websites contain links back to it. We include the
term “relevant” because the search engines have gotten smarter. It’s no longer a “more is better” game
but one of quality.
Do your plans for success include beating your competitors on the Web? They should. The Web offers
an amazing opportunity to expose more people to your company, strengthen your brand and add
profitable revenue. But make the most of your time and energy, and do as Stephen Covey suggests:
First Things First. In the game of website marketing that’s Architecture, Content and Incoming Links.
Expertise
for the
business
owner
Matt Bailey of SiteLogic provided his expertise for this article. q
Information for RBC Bank Clients
301 Fayetteville Street Raleigh, NC 27601
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February/March 2010 • Volume 5, No. 4
R E A L E S TAT E
Be Your Own Landlord
Odds are your wealth is concentrated in a single investment
— your business. Your personal investment portfolio lacks
diversification. Resting your entire financial future — or a
large portion of it — on a single investment is a risk you don’t
want to take. At the very least, fund retirement accounts to
their maximum. Investing in real estate should also be an
absolute priority, and the best opportunity beyond your home
is the facility your business occupies.
If you don’t
own the land
and building
your business
occupies, now’s
a great time to
make it happen.
If you don’t own the land and building
your business now occupies, now’s a
great time to make it happen. Real estate
values are down. Way down. Ditto for
interest rates. They’re not going to stay
down forever. Far from it. The time to
act is now.
With the rent you now pay you should
be able to pay the interest, principal,
taxes, maintenance and upkeep on a
facility you purchase and with every payment you build equity
and grow your personal net worth.
Scary? Of course. Charge forward with courage. The move
makes so much sense. It’s not like you’re buying a second
home. It’s less risky than that and the odds are — if you can be
sure to not overpay — it’ll pay off handsomely.
Remember, though, it will take many years to pay down the
principal portion of the debt you borrow to make the purchase,
so buy as early as possible. Let time work its magic. q
THE BUSINESS OWNER ADVISOR
David L. Perkins, Jr., Publisher and Editor
[email protected]
This publication is owned and published by DL Perkins, LLC,
5727 South Lewis Avenue, Suite 400, Tulsa, Oklahoma 74105; 918.493.4900;
Fax 918.493.4924. [email protected]
Copyright © 2009 by D.L. Perkins, LLC. All rights reserved under International and Pan American Copyright
Conventions. Reproduction, in any form, in whole or in part, is prohibited without written permission from
an officer of D.L. Perkins, LLC. Issn. No. 1556-2026. Vol. 5, No. 4
Cover illustration credit: © ImageZoo Media Inc.
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engaged in providing legal, tax, insurance, investment or other professional advice. The advice of a
qualified professional should be sought before any reader applies a concept presented herein to his or
her particular situation or business.
2 • The Business Owner Advisor, February/March 2010
RISK MANAGEMENT
Business Owner
Imperative:
Ensure Continuity
As a business owner, your number one priority is to ensure
the ongoing existence of the business. This is why you work
each day to earn a profit and produce positive cash flow. A less
obvious but very real threat to the survival of your business is
the sudden and unforeseen event that puts you out of business
or inflicts long-term damage. Fire, flood, data breach or events
that damage your public image or reputation. Or the loss of a
vital customer, vendor, license, employee or representative.
Just as the business owner must work each day to secure profit
and liquidity, he or she must protect the business from loss due
to sudden, unforeseen events. Here’s how:
Identify Your Most Critical Assets
List the assets you use in the creation and delivery of your
goods or services and in the operation of your business. Add to
the list items necessary to prove ownership of valuable assets,
rights or interests, such as titles and insurance policies. Rank
each asset or asset class from most valuable and/or critical to
least valuable and/or critical.
List Things That Could Damage Each
Brainstorm about all the things that could damage each critical
asset and/or sever you from full access. For an asset such as
your website, it could be a failure of your server by fire or
flood. For a key employee or vendor agreement, for example, it
could be an erosion of a personal relationship. Whatever it may
be, list the things that could cause damage or separation.
Develop Mitigation Plans
For every possible loss event develop a mitigation strategy.
For example, if a key asset is a relationship with a person or
organization, your plan might include a strategy to reduce
reliance on the relationship as well as a multi-point strategy for
keeping the relationship.
Periodic Review of the Plan
Over time, your business will evolve. Your risk exposures
will evolve as well. To be sure you’re doing what you can to
ensure the continuity of your business, periodically pull out
your continuity security worksheets. Go over them thoroughly
and update them. Spot new risks and develop and implement
strategies for mitigating exposure.
Your most important job, as a business owner, is to ensure the
survival of your business. Profitability is essential, but don’t
forget about the risk in unforeseen events. q
PROFIT ENHANCEMENT
Free Up Cash via ABC Inventory Control
The skill of a company in procuring (i.e., purchasing) and
managing inventory can be the difference between success
and failure. This is because:
1.The profitability of a business — or lack thereof — is
established by the gross profit margin. That is, the
profit left over from each sale after the direct expenses
are deducted. For many businesses, the primary direct
expense is procured product.
2.Inventory ties up a significant amount of cash in many
businesses. Poor inventory management can drain a
company’s cash, raise financial risk by requiring higher
levels of borrowing, and erode profits due to outsized
inventory spoilage, obsolescence or theft.
ABC inventory control is a relatively simple, widely used
way to wring out cost, improve gross margins and increase
inventory turns. Increased “turns,” of course, lower the
amount of inventory-on-hand.
If inventory-on-hand can be
ABC inventory
from $500,000 to
control is a relatively lowered
$300,000, the result is $200,000
simple, widely used
in positive cash flow. If the
business uses the accrual system
way to wring out
of accounting for tax purposes,
cost, improve gross
the windfall doesn’t trigger tax.
margins and increase
inventory turns.
The ABC inventory control
method derives both its
simplicity and effectiveness from
the 80-20 rule. So, to begin to understand and apply the ABC
methodology the business owner should begin here: 80% of
a company’s revenue is derived from 20% of its offerings.
Every business owner should know which of his/her
products or services produce the lion’s share of the revenue
and profit. Additionally, within this 20% you should
learn what components make up 80% of the cost of these
products. As Harry Figgie says in his The Cost and Profit
Improvement Handbook, “These are the parts that make up the
largest share of the company’s material costs.”
• stockouts of these items are rare despite the low levels
maintained on hand
Conversely, items that cost the least are categorized as “C”
items and can be purchased much less frequently, such as
once per year. Doing so will reduce the time required to deal
with ordering (and thus free up time to focus on A items) and
render little financial consequence because the total dollar
amount is insignificant. Of course, all other parts are labeled
“B” items. These items can be ordered in smaller quantities
than C parts, maybe monthly or quarterly, but much less
frequently than “A” parts.
Margin Improvement
By knowing where to
focus, one can gain a
maximum return on
one’s investment of
time and energy.
In addition to inventory reduction
and the important positive cash
flow impact that a reduction can
provide, ABC is a powerful tool
for helping the business owner
determine where to focus his/
her energies to successfully wring out cost and improve gross
profit margins. With the simple analysis provided, the number
of inventory items that require cost reduction focus is cut by
80% or 90%.
Time, of course, is scarce for all of us. Scarce for our employees
as well. This is one of the benefits of the ABC inventory
control methodology. By knowing where to focus, one can
gain a maximum return on one’s investment of time and
energy. The result can be the very survival of one’s business,
or the difference between just getting by and making some
real money. After all, 20% of the businesses make 80% of the
profits. Apply ABC inventory control to your business and
you’ll be well on your way to the top 20%. q
Armed with this basic information, the business owner can
sit down with his/her purchasing manager and begin looking
for ways to lower cost and reduce the amounts kept on hand.
Divide and Concur
Building on the simple 80-20 rule, ABC inventory control
methodology calls for each purchased item to be separated
into one of three groups: A, B and C. “A” items are those
relatively few that represent the highest cost and generally
the greatest investment. As such, these items should be given
considerable attention so:
• stock levels of these expensive items are minimized
so the cash tied up in inventory is kept as low as
possible, and
“Do me a favor and call Tom. It looks like Jerry is on to something.”
© Mark Anderson, All Rights Reserved www.andertoons.com
The Business Owner Advisor, February/March 2010 • 3
Today, there probably aren’t as many people encouraging you to strike out on your own as there once were.
But your new business ideas are still strong. At RBC Bank, our strength and stability can help you stay focused
on bringing them to life. Today, you need the confidence of a partner who can help you create the business you
envision. Which may also mean today is the day to change to RBC Bank.
Call 1-800-236-8872 or visit a nearby banking center | rbcbankusa.com
MEMBER FDIC. ©RBC BANK (USA) 2010. ®REGISTERED TRADEMARK OF ROYAL BANK OF CANADA. USED UNDER LICENSE.
RBC BANK IS A TRADE NAME USED BY RBC BANK (USA) AND ITS BRANCH OFFICES OPERATE UNDER THIS TRADE NAME.