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Volume 3 l No. 6
www.cvbusinessmonthly.com
BUSINESS MONTHLY columns Page 6
Jim Offner Family-run businesses the backbone of our economy.
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Wartburg College ‘Strictly business’ is not best for everyone.
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University of Northern Iowa Have an ‘elevator pitch’ prepared for your business.
Page 35 Nonprofit Excitement is building at Habitat for Humanity .
Page 37 Main Street Downtown Waterloo flowering this spring.
BRANDON POLLOCK / Courier Staff Photographer
June Birdnow talks with 1-year-old Sara Mead as Sara’s dad, Koley, who works for the Jesup Birdnow automobile dealership, works with Gene Wyant to purchase a minivan March 18 in Oelwein.
BUSINESS MONTHLY staff directory EDITORIAL CONTENT Nancy Raffensperger Newhoff nancy.newhoff@wcfcourier.com (319) 291-1445
ADVERTISING Jackie Nowparvar jackie.nowparvar@wcfcourier.com (319) 291-1527
Jim Offner jim.offner@wcfcourier.com (319) 291-1598
Sheila Kerns sheila.kerns@wcfcourier.com (319) 291-1448
Cedar Valley Business Monthly is published monthly. It is a free publication direct-mailed to more than 6,500 area businesses. For distribution, call Courier Communications at (319) 291-1527. Contact Cedar Valley Business Monthly at P.O. Box 540, Waterloo, IA 50704.
Family values Birdnows defy trends, expand area automobile business By JIM OFFNER Courier Business Editor
BUSINESS MONTHLY on the cover BRANDON POLLOCK / Courier Staff Photographer
Clockwise from left: Justin, Jeremy, June and Mark Birdnow at one of their dealerships.
JESUP — The car business is supposed to be shrinking, but an area family doesn’t seem willing to follow that dire trend. The Birdnows appear to be flying high these days. It started in 1976, when Mark Birdnow opened a small AMCJeep dealership in Oelwein, his hometown. He sold that business after five years and opened a Chevrolet dealership in Jesup. He has been there ever since. But he didn’t stop there. His family was growing, and as
his sons matured, they became part of the family business. Now they and their mother help Mark Birdnow run a growing concern with dealerships not only in Jesup but in Oelwein, Independence, Monona, Cascade and Fayette. The support of family has been a central ingredient in the company’s growth, Birdnow said. “For one reason: Both of my sons are in the business with me. They both love the business, and they have what it takes to be managers and go on to be dealers themselves, eventually,” Birdnow said.
The business really took off in 2002, when Birdnow picked up the General Motors dealership in Oelwein, where he had gotten his start only a few years earlier. The family element is crucial, Birdnow said. “I feel qualified to say that, because I’ve been in a couple of different dealer groups where I’ve been exposed to first-, second- and third-generation dealers,” Birdnow said. Sometimes, Birdnow added, the second and third generations don’t measure up. See BIRDNOW, page 5
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BIRDNOW From page 3
“Sometimes, a second- or thirdgeneration dealer isn’t as good as the guy that started the deal because they either felt forced into it or wanted to do it because they thought it would be an easy life because it was handed to them,” Birdnow said. Not so with his sons, he said. “My sons do have what it takes,” he said. Jeremy, is co-manager of the Oelwein store. Justin, 26, manages the Cascade location. Both studied marketing and business management at Hawkeye Community College. Membership in the Iowa Automobile Dealers Association also helped Birdnow build his family’s business. The automotive industry is hurting at a time of recession, with all major domestic and foreign manufacturers reporting year-onyear sales losses of 40 percent or more. However, the Birdnows — Mark, his wife, June, and sons Jeremy and Justin — say they are enjoying solid growth. “Starting in 2002, we’ve expanded to where we have four new car dealerships in Jesup, Oelwein, Cascade and Monona,” Mark Birdnow said. “Then, I have a pretty good-sized auto recycling business in Fayette — a salvage yard is what it used to be called. And, I have a used-car location next to the Wal-Mart in Independence.” Birdnow also recently bought a Chrysler-Jeep-Dodge dealership in Independence. “In late November, they announced to their employees that they were going to shut down at the end of that week,” Birdnow said. “I called the dealer that owned it, because he’s somebody I’ve known for 30 years — he’s from Oelwein. I discussed alternatives, one of which was maybe I’d buy the dealership.” He did. By combining it with his Oelwein location he was able to retain five employees. He moved the franchise to Oelwein March1. There’s a bit of a historical connection: Walter P. Chrysler lived in Oelwein in the early 1900s. “He worked for the railroad and went to what I think was the first Chicago auto show,” Birdnow
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said. “While he was there, he bought a locomobile for about $5,000, which, in that, day, was an enormous amount of money. He had to borrow the bulk of the money. He got it home and took it apart, to rebuild it. He thought he could build a car better. He moved to Detroit or somewhere in Michigan and, by 1906 or ’07 the first Chrysler was built.” The Chrysler connection to Oelwein was helpful, and certainly not a slap at Independence. But it wasn’t the key reason for moving the dealership, he said. “More importantly to me was creating a unique opportunity to market the Big Three in a central Northeast Iowa location,” he said. Birdnow retained all the employees who wanted to continue employment and created something of a rarity: an entity with all the GM, Chrysler and Ford brands in one dealership . The family employs about 75 full-time and 12 part-time employees at its dealerships. More growth occurred Jan. 1, when the family moved its Cascade dealership into a new facility. Birdnow knows it is an unusual time for a car company to expand, given the downturn in the automotive industry. “I remain very upbeat about he economy in Iowa,” he said. He says much of the U.S. car industry’s problems are creations of misapprehension. “I believe that the media, particularly the magazine and the electronic media and not so much print media, over the years for some reason has had a bias against American-made vehicles,” he said. “Going back 15 years ago and even further back ... the quality of all the manufacturers — GM, Ford and Chrysler — has been equal in every way to the import vehicles. Going back even further, the only thing that was really better about the imports was the four-cyclinder engines in the smaller cars.” Sales have justified Birdnow’s confidence, he said. “Up through January, they were pretty strong. February slowed down some,” he said. “I’ve been through several downturns, and it seems to take longer to get to Iowa. When it gets here, it isn’t as severe, but it does take a little longer to get over it in Iowa.”
Economic downturns come and go, but people will always need cars and trucks, Birdnow said. “I think my network of dealerships can survive because our fundamental belief is we can act
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like a big dealer as far as good selection and top-notch technicians to take care of customers,” he said. “But, we’re also smalltown dealers. It’s not the same as a big dealer. When people come
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in, they see people they know. We can be on a first-name basis with our customers.” Contact Jim Offner at (319) 291-1598 or jim.offner@wcfcourier.com.
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Family-run enterprises the backbone of business community It’s a fact small business, which makes up more than 80 percent of commerce in the U.S., is the nerve center of the domestic economy. Let’s take that metaphor a step farther and call the family Jim Offner owned business is the Courier the spine. business editor. A couple of Contact him at years ago, Busi(319) 291-1598 or ness Week jim.offner@ quoted some wcfcourier.com. statistics from the University of Southern Maine’s Institute for Family-Owned Business: ■ About 35 percent of For-
tune 500 companies were family-controlled. ■ Family businesses account for half of U.S. gross domestic product and generate 60 percent of the nation’s employment and 78 percent of all new job creation. Some of the largest mega-corporations started as family operations, not the least of which is Wal-Mart Stores Inc., which Sam Walton built into the world’s largest retailer. Ford Motor Co., a creation of Henry Ford, who himself revolutionized heavy industry in America, is still owned and run by his descendants. Perhaps it’s not coincidental that Ford is the only U.S. automobile manufacturer that has not been to the bailout trough.
Much closer to home, even Deere & Co. was run by the Deere family for nearly a century-and-ahalf before the last descendant of John Deere left the company in the early 1980s. That’s not to say the road for family businesses is anything but uphill. Most small-business ventures end in failure. According to the U.S. Small Business Administration, only two-thirds of all small business startups survive the first two years, and less than half make it to four years. Enterprises that depend on contributions from family members have their own challenges. In some cases, children don’t necessarily want to carry on the family legacy, having not acquired the parents’ zeal for the business.
Children who do want to carry on the family business often bring their own ideas about how to build the enterprise. That can bring a mixed-bag of results; some new ideas are better, others aren’t. For whatever reason, there must be a lot of good ideas floating around the Cedar Valley, because the area is rife with family-owned commercial operations in a range of sectors. A few examples: ■ Cedar Valley Corp. specializes in highway construction. ■ Warren Transport Inc. is a major trucking firm. ■ Powers Manufacturing Co. jerseys are worn by major college athletic teams. ■ The name Bertch is synonymous with cabinetry in this
region. ■ The Lockards have built a major real-estate company. ■ Matt Parrott & Sons Co. offers office products and printing services. ■ Hellman is a major advertising agency that is run by the Hellman family and maintains its Cedar Valley heritage and values. The list embraces everything from roofers and barbers to momand-pop retail shops. A glance at this month’s Cedar Valley Business Monthly will provide insight into some of those businesses and what makes them flourish, as well as provide these businesses’ unique perspectives on how these enterprises are able to survive and thrive in an increasingly corporate culture.
Last recession taught executives lessons about negotiating severance packages The Associated Press
The recession of the early 2000’s taught employees valuable lessons about job security. Executives are negotiating severance before they are hired and aren’t accepting the standard package, according to a recent study by human capital consulting company Lee Hecht Harrison. Nearly 90 percent of top officers negotiated severance last
year, compared with 23 percent in 2001. “Individuals are more savvy now, and companies are more flexible,” said Barbara Barra, executive vice president for field sales and operations. “When people think about separation benefits, it’s not just about the money but also healthcare coverage negotiations, career transition assistance, references and what the company will say about the departure.”
Companies have learned to use severance packages as a tool to lessen the risk of litigation. In 2001, 76 percent of companies required employees to sign a release in exchange for severance.
In 2008, that rose to 93 percent. “Even though it’s tough economic times, employers are taking to heart how they treat people when they let them go,” said Rob Saam, senior vice president of
Lee Hecht Harrison. Guideline Research surveyed 1,072 executives through mail and e-mail. The study has a statistical margin of error of plus or minus 2.8 percent.
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‘Strictly business’ not always best What does the phrase “strictly business” mean? It frequently connotes seriousness or gravitas. The implication is there is the “serious business of business,” and there is everything else. If we’ve learned anything over the past several months, it is that the phrase “strictly Fred Waldstein business” is a is the director of the double - edged Institute for Leadersword. ship Education, Irving Business R. Burling Chair tycoons who in Leadership and media professor of political were science at Wartburg darlings a few College in Waverly. months ago are Contact him at (319) now pilloried 352-8259. as devious and corrupt. “As long as I get mine, the rest be damned,” seems to be the mantra for which Bernard Madoff is just the latest poster child. Enron’s Kenneth Lay and World Com’s Bernard Ebbers were previous holders of this dubious honor. But what does it say about the rest of us — media included? We lionize the wealthy because we assume wealth is the standard for success. This breeds a culture in which getting ahead financially is the standard by which people are valued. There is little consideration for the quality of decisions because we have no way of measuring their effects beyond dollars and cents. These externalities, as economists call them, can have a real impact on quality of life issues. But such costs have no extrinsic value and are discounted. This happens when we operate under conditions that are “strictly business.” It is not the purpose of this article to condemn the profit motive or denigrate business. The charge that the captains of the financial world are all villainous ogres is just as simple-minded as the endless praise previously heaped upon them. Both profit and business have important roles to play in our market economy.
The purpose of this article is, rather, to help us think about how narrowly we measure success and failure if we subscribe to the rules that are “strictly business.” What if we abandon the dichotomy that places those values that can be measured in dollars and cents as “strictly business” and places everything else in the category of externalities? It is a false dichotomy. What we value as humans is quality of life. In the modern world, the medium for exchange to determine how one strives to attain a desired quality of life is based in the market economy. And that is not inherently bad. Money is neither good nor bad. It is a neutral medium that is a convenient means for the exchange of goods and services. But when it becomes an end in itself and serves as the measure of quality of life, we have gone askew. We have created a situation in which financial motives may be directly contrary to maximizing quality of life. Not long ago I heard a professor describe what he perceived to be a transition in the disciplinary interests of students attending his religion classes. More were studying business, finance and similar pre-professional programs. The university was placing ever greater emphasis on these types of programs at the expense of its liberal arts tradition. He was not “anti-business,” but he did wonder why this was happening. If the values and goals of business become dominant values of society at large, what values may we be sacrificing? Is the concept of “strictly business” healthy for society? Or, do we need to constantly weigh the values of business against the broader values that help define a democratic society and the traditions on which it was founded? These questions require us to use our skills of critical inquiry to challenge accepted wisdom. This is at the heart of a liberal arts education. The state of the world economy and its impact on the lives of people worldwide suggest these questions are worthy of close examination.
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Family business: Beat the odds, pass it on The importance of privately held family-owned business to our country’s economic machinery is immense. This type of business generally accounts for nearly 60 percent of the total Dennis Eslick e m p l o y m e n t is a chartered in the U.S. and financial consultant with Eslick Financial over 75 percent of all new jobs Group in Waterloo. that are created. Contact him at (319) 833.5555. Many of these companies’ founders intend to pass the business on to succeeding generations of their family. While their intent is clear, the reality is that only about onethird of these businesses pass successfully to the second generation, 10 percent to the third generation and 4 percent to the fourth generation. Those are not very good odds. The most frequent reasons for
these poor results: ■ No family member is interested in the business. ■ No exit strategy exists for the senior generation. ■ A lack of estate and retirement planning for the senior generation. ■ The conflict between business prosperity and family unity is ignored. ■ The conflict potential between active and non-active siblings is ignored. ■ Illiquidity for inheritance taxes and stock redemption is ignored. ■ Inappropriate business legal structures for succession. ■ Planning is not started until an illness, accident, death or divorce forces the issue. Let’s consider the following example: John and Marcia, ages 62 and 59, respectively, founded a small manufacturing company 25 years ago. They now have 30 employees. Their three adult children are married and currently are 38, 34 and 29 years old.
Their 34-year-old son, Jason, has worked for the company since college and is heading the sales and marketing department. John and Marcia feel confident Jason is capable of taking over the business someday. Their other son and their daughter have stated they have no interest in working for the family business. No one outside the family owns any stock in the company, and each of the three children have been gifted company stock over the years in minor amounts. While Marcia has worked off and on in the business, she now prefers to help out just one or two days per week in the accounting area. Marcia would like John to slow down and give Jason more responsibility. John is heavily involved in the day-to-day operations and is beginning to wonder about his exit strategy. He has not discussed his desires or concerns with his children or a professional adviser. John and Marcia have accumulated a good nest egg con-
centrated in 401(k) accounts, significant real estate and their business interests. As the senior generation, their primary goals are: 1) make sure their retirement is secure; 2) pass on the family business to Jason; and 3) treat all three children equally, retaining family harmony. John and Marcia now recognize they had been so busy working “in” their business they forgot about working “on” their business. They realize they do not have the answers and do not know how to arrive at a solution. They decided to meet with a financial adviser who specializes in working with family-owned businesses to analyze their business succession goals as well as their estate and retirement income needs. Soon after, their attorney and accountant were consulted and a process was started to help them answer the following difficult questions: 1. If they keep the business in the family, will it produce enough income to support both John and
Marcia upon their retirement as well as Jason and his family? Or, will the business produce enough income to allow Jason to purchase the business from them? 2. If John decides not to retire and the business is bequeathed to Jason, how will Marcia be taken care of? How will the nonparticipating children fare in the equalization goal? 3. In the untimely death or disability of John, is there a buy/ sell agreement to help with the transfer and will there be enough cash available to both meet the company’s obligations and provide for Marcia’s lifetime income needs? 4. If John and Marcia die in a common accident, will their estate and transfer taxes force the sale of the business and leave Jason without a career? 5. Will the other key employees (nonfamily members) stay with the company upon John’s retirement or death? See ESLICK, page 9
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Quick! Tell me about your business We don’t have a lot of high-rise buildings in the Cedar Valley, but businesses still should have a prepared and practiced elevator pitch. An elevator pitch is presented in 30 seconds to two minutes Katherine Cota- and it is a “brief, Uyar carefully conis program manager structed statefor the John Papment that outpajohn Entreprelines the merits neurial Center at the University of Northern of a business opportunity,” Iowa. Contact her according to at (319) 273-5732 or katherine.cota@ entrepreneuruni.edu. ship professors Bruce Barringer and Duane Ireland. The scenario involves an entrepreneur stepping on an elevator and through a stroke of luck there is a wealthy business investor on the same elevator. They ride together just long enough for the entrepreneur to tell the potential investor about the entrepreneur’s business opportunity. At our Student Business Incubator and in our entrepreneurship classes, we have students create and participate in competitions for elevator pitches. In November, Tyson Hanish, an entrepreneurship student and owner of BigLeagueAnalysis. com, a business in our student business incubator at the time, took third place at a national elevator pitch competition. Most elevator pitches are con-
ESLICK From page 8
6. If all three siblings inherit the business equally, how can Jason run the business without controlling interest? Could this create a significant sibling conflict of interest? 7. If Jason doesn’t get more responsibility and training soon on all aspects of the business, will he be able to handle the entire business if John dies
structed for entrepreneurs seeking capital. The purpose is to get a meeting with the investor, but that is not the only reason to develop an elevator pitch. Most businesses can benefit from having a short, compelling statement about the company. The elevator pitch can serve a marketing and networking function. With a prepared pitch, the entrepreneur can state clearly and concisely what the business does. Barringer and Ireland provide an outline for a 60-second elevator pitch. They suggest the entrepreneur begin by describing the opportunity in about 20 seconds. Proceed to describing the product or service and how it meets the opportunity or solves a problem for the next 20 seconds. Describe the market and the entrepreneur’s/owner’s qualifications in the final 20 seconds. Practice the pitch for effective delivery and so it sounds conversationally natural. Know the general points to be made. This will help the entrepreneur to sound conversationally natural and not overly rehearsed. One final note about elevator pitches is they can be adapted for use in other situations. People seeking employment might develop a pitch about themselves for use when asked during an interview, “Tell me a little about yourself.” Other situations include networking events and social gatherings. Learning to speak effectively and concisely is a valuable skill for any person in any business.
unexpectedly? So, how does a family business owner beat the horrible odds of transitioning their business down to the next generation? The answer: Start your succession process now using an experienced and reputable adviser team. By starting early, you can integrate the solution into your normal business today and work toward a successful future business transition, whether the situation is a planned event or an unexpected event.
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Don’s TV retains family spirit, if not connection Don’s Maximum Sight & Sound has seen its share of changes in almost 60 years of operation, including the name — it was formerly known as Don’s TV & Appliance. One thing hasn’t changed: It’s still Brian Shaw locally owned. of Don’s TV MaxiTerry Root, mum Sight & Sound only the third in Waterloo can be owner in the contacted at (319) business’ histo234-0344. ry, believes that being a familyowned local business is a huge advantage in the Cedar Valley. “People get to know you and keep coming back,” Root says. “They tell their neighbors, and they come in to buy. Next thing
you know, their kids are in saying, ‘Dad told me to come here to look for TVs.’” Many people are amazed that a family-owned consumer electronics store can thrive in today’s market. With competition from big-box stores and increasingly heavy demands placed on the technical skills needed to operate a consumer electronics business, it would seem difficult for a locally owned business to survive. Yet Maximum Sight & Sound has not only survived but prospered. Last year’s revenues were 10 times greater than when Root took the reins as sole owner less than 10 years ago. “We are always looking at what our competition is doing,” says Root, “and then either doing more or just seeing how we can do it better.”
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Service is the one area that sets Maximum Sight & Sound head and shoulders above the massmarketing chains. The company employs its own service technicians. It has employees who deliver and connect components. And it has the technical expertise to install some systems only a handful of companies in the state can do. “We consistently get compliments from customers about our
employees,” Root says. “Whether it’s elderly people who are impressed with how we took the time to explain the operation of their new items to people who have just built a wonderful new home and liked how we were courteous and cleaned up after the job was done — we ask that our employees give just that little extra that people will remember.” Although Root is not related to
the former owners, he believes the business continues to display the charm and warmth it has had since it’s inception. “Even though we continue to grow,” says Root, “we’re still a small business. People still like coming by to talk, to see what’s new. They like knowing that a year from now they can come in and see the same people they’ve always known and bought things from.”
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Agency sprang from family dreams Over the last 50 years, FishJohnson Insurance has answered many questions for our clients. Two questions that come up very often are “Who is Fish-Johnson?” and “How did you come up with your clever logo?” I think it is time to answer both of those questions Randy Johnson publicly. Fish–Johnis president of the Fish-Johnson Insur- son Insurance ance Agency. He can began in 1959 be reached by calling when Jim John(319) 233-3335 or son purchased randy@fishan insurance johnsonins.com agency named The Mack Fish Agency. The agency at that time was located at 227 W. Fifth St. in Waterloo. When Jim merged the two names he needed a creative logo to catch peoples’ attention. Jim asked a good friend in the advertising business to come up with something. What he showed Jim was an image of a Fish made out the “F” in Fish and an image of a hook made out of the “J” in Johnson. The rest, as they say, is history — 50 years of history serving the insurance needs of people in the Cedar Valley. As the agency’s current owner and Jim’s son, I joined FishJohnson Insurance in 1980 after graduating from the University of Iowa’s insurance program. At the beginning of my insurance career, it was Jim; my mother, Betty, a bookkeeper; a secretary (what they were called in 1980 — today, they’re called “account service representatives”); and me. During this time frame, the agency was moved to its current location at 1215 W. Fourth St., Waterloo. Although Jim and Betty have been retired for several years, their impact on Fish-Johnson Insurance and how it operates today is still apparent to me, our employees and our customers. To begin with, we are located in what was a very beautiful home in its day, with working fireplace, leaded glass and spacious offices.
Our location reinforces the feel that our customers are like family as well as our employees. If a customer wants to come in to pay their bill and talk about the weather over a cup of coffee that’s just fine. If an employee needs to leave early for their child’s conference at school, that is OK, too. We try to offer what the larger agencies can’t — a warm friendly atmosphere to work and do business. Another part of the FishJohnson insurance experience is that you can still have one agent handle all of your insurance needs, and that will be the agency owner. For many years, I have read insurance articles that say you have to departmentalize your agency. You have to have a separate commercial department, personal insurance department and as well as a life and health insurance department. Frankly, variety is what I enjoy about this insurance business. One phone call may be about auto insurance, another, health insurance, and yet another, business insurance and so on. It may take more time keeping up on continuing education for all areas of insurance, but I know my clients like having one agent for all of their needs. Variety at Fish-Johnson Insurance also means we will offer choice for our clients in terms of companies and coverage. We represent only leading companies in the industry, so when someone calls, we know we are offering them the best rate and coverage for their needs. One difference between us and many other agencies is that we also evaluate a customer’s rate at renewal time. If a policy renews with a rate increase higher than the industry average, we will compare their renewal with our other companies’ rates. If we find a better market for their insurance, we will contact them and discuss our recommendation It is a personal caring attitude based on principles handed down from one generation to another that has allowed us to do business for 50 years, and hopefully it will for another 50 years.
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Focus on profitability is central to business success Profitability is a key factor to the vitality of any business and its ability to react to change. It also ensures value is being increased so there is something to sell when the time is right. Growing a business is easier when it is profitable, Phil Kenealy because growth is owner and requires capipresident of ACES. tal. A profitable Contact him at has pkenealy@acesiowa. business cash in reserve com. to finance acquisitions and new product development. Small business owners have a choice about the kind of business they want to develop, a lifestyle business or an enterprise business. A lifestyle business is one in which the owner’s expectation is to provide a good living doing something he/she enjoys doing. It can be very gratifying for someone who does not have aspirations to lead a large staff of employees. A
lifestyle business’ growth potential is limited to the resources of the owner’s skill set and time availability. While profitability is important to maintaining a lifestyle business, many lifestyle business owners manage profitability to minimize taxable income. An enterprise business, on the other hand, is more growthoriented. Enterprise businesses require cash reserves to weather the ups and downs of the economy, to finance mergers and acquisitions and to develop new products and services. An enterprise business must strive for profitability for sustainability and to maintain its competitive edge in the marketplace. Many small business owners end up running lifestyle businesses when they want an enterprise business. This happens because the focus on minimizing taxes supersedes the emphasis on the profitability necessary to build a sustainable cash reserve. To rectify this, small business owners must shift the focus to profitability. That requires a shift
in the owner’s mentality to make profit a line item at the bottom the budget/forecast at the beginning of the year. To accomplish this, there has to be a reckoning of how much profit is required to meet the company’s growth objectives. The owner has to determine whether that amount is feasible in the current market, industry, economy, etc. Business owners need to ask these questions: ■ “Is profit possible?” ■ “How much profit is possible?” ■ “What is the industry average and best-in-class profitability?” ■ “What needs to be done differently to generate desired profitability?” ■ “How do we generate sustainable profit?” Resources for finding answers to these questions might be a business mentor , a peer group to serve as a virtual board of directors and industry statistics from vendors or distributor partners or trade consultants. A good next step toward prof-
itability is to perform a SWOT analysis on your business considering its strengths, weaknesses, opportunities and threats. Strengths. Attributes of the organization helpful to achieving the objective. Weaknesses. Attributes of the organization harmful to achieving the objective. Opportunities. External conditions helpful to achieving the objective. Threats. External conditions that could damage performance. Once a SWOT analysis is complete the owner can set realistic profitability goals. But, who is going to hold him/her accountable to reaching those goals? Small business owners many times have no accountability structure other than to themselves. Too often owners fail to hold themselves accountable. This is where an industry peer group or mentor can be a great asset. Having a mentor or peers that care enough to tell an owner what he/she needs to hear is a valuable asset. This accountability forces them
to set in place the tools necessary to measure profitability and progress toward the goals. Business profitability that walks out the door when the owner quits or retires does not build value in a company. Ultimately, the owner is going to leave the business. In order for a business to have value to a buyer, it has to demonstrate an ability to generate profit without the owner. So, in addition to focusing on profitability, an owner should strive to enable the staff to run the business. That’s a hard thing to do for a sole owner. It is difficult to give up control and allow staff to make decisions once reserved for the owner. However, staff must have the freedom to “fail their way to success” in order for the business to have value without the owner’s presence. A business is only worth what someone is willing to pay for it. Sustained profitability plays a huge role in determining the price for which a business can be sold when the owner is ready to ride into the sunset.
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Building a passion into a thriving family firm The theme of Business Monthly this month is family-owned businesses. To say I was surprised when asked to contribute this article as well as being featured on the cover would be the classic Mark Birdnow understatement. can be contacted at How does one (319) 827-1355. create a “family” business? How does one build a family business, or any business? For a family business, obviously, one needs people in the family who wish to be in the business. In any case, one needs to be in a business that is needed, or build a business that is needed in the community. Then follows the hard work, study, long hours, risk, worry, as well as a lot of luck being needed. Part of my luck was being blessed with a wife who not only understood, but helped support my efforts, first by working and later by working in our business. I’m what would be defined as a first-generation auto dealer. No one in my family was in the auto business before me. I got my start by talking my way into a job at a local auto dealer. It was an entry-level position as a sales trainee. I had no education beyond a high school diploma. I learned all that I could and after five years started a very small auto dealership in my hometown of Oelwein. With a lot of long hours, work and worry, I built that business up quite a bit in five years. I was able to sell it, and buy my current home-base dealership in Jesup. Here’s where the family comes into play in our business: I have two sons who are deeply involved
as investors and as managers. I’m quite proud of the fact they are investors because of their careful financial work rather than any kind of gift from me. In 2002, a second dealership opportunity opened up. With careful thought, I realized my two sons not only love the business we are in, but they also have what it takes to be managers and eventually dealer/owners. I say that with a more critical eye than I would use evaluating non-family employees. I know many second- and third-generation auto dealers, and not all of them have their heart in it. My sons do. So we set off on building a group of businesses that could survive well into the future. As long as people need to move about there will be need for transportation, and whatever that transportation is it will need service. We intend to offer both, the transportation and the service. We have expanded to six Northeast Iowa locations that offer everything from recycling autos and parts to new vehicle s. It’s kind of like farming; one has to get bigger in order to survive. If you want to start a business, and you are concerned about the big retailers, offer something they don’t. It can be a product or the way you service customer needs. It can be that you’re the smiling face when customers stop at your business rather than the hard-tofind employees at big stores that won’t make eye contact. Be on a first-name basis with your customers rather than making them a number. Avoid a lot of turnover in staff, and make sure your staff takes care of customers the way you want. Customers like to see familiar faces when they visit your establishment. Try to make a small profit on
many sales rather than a large profit on one. Everything we do is designed to make customers want to do business with us over and over. Finally, make yourself available. My home number is in the phone book. I often give career talks at schools. I’m passionate about education, even though I had no formal post-secondary education. I like to tell students that more
education would have saved me tens of thousands of dollars I’d have not wasted by making mistakes. Education isn’t the only answer — experience is a huge part — but education gives one the foundation to build upon. Many times that community college certificate or degree is the ticket to get an interview as well. Final advice: Don’t think owning a business is an easy life.
Sure, you work for yourself, but the buck stops with you. You are responsible, not only for you and your companies’ financial wellbeing, but for all of your employees. You need to set a good example for your staff. However you act will be reflected in how they act, whether it is with customers, being on time to work, honorable in your dealings, etc., you set the example.
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Family builds PIPAC on commitment to service
What is PIPAC? Most people, referring to the building now called Park Place Event Centre, would say, ‘It’s that beautiful event building in Cedar Falls.’ And, they would be right. But that is only half of the story. While the Park Place Event Centre is located in the top portion of the building, the other half is home to PIPAC — Professional Insurance Planners and Consultants. It may not be well known to the public, but it is to many independent health insurance agents. PIPAC is a premier wholesaler for Wellmark Blue Cross and Blue Shield of Iowa and Wellmark Blue Cross and Blue Shield of South Dakota, as well as other top-name companies. It is a family-owned business with more than 35 full-time employees and 1,100 active insurance agents. Entrepreneur Greg Saul established PIPAC in 1981. As a young agent, Saul saw a need that was not being met: insurance coverage for farmers and health insurance for people who had a lot of health conditions but had trouble getting coverage. Saul , through his previous nine years of insurance experience, knew where and how to get insurance coverage for those clients. He became the consultant and problem solver for agents. PIPAC was born. As PIPAC grew, it was operated from several Cedar Falls locations over the years with the help of Greg’s wife and busi-
ness partner, Lea Ann. While Greg wore the sales hat, Lea Ann brought experience with the administrative systems side of the business. They were both passionate about helping the agents find the right type of insurance for their clients. “You have to be passionate about how you fill the need,” Lea Ann said. “If you don’t have that passion, then don’t do it, because it’s really hard to own and operate your own company. You have to wear so many hats, and you live and breathe the business 24-7.” As a family with a familyowned company, one challenge is finding time to spend family time together without discussing business. “We have to sometimes say, ‘OK, we are going to spend dinner with the kids, and we are not discussing work,’” Lea Ann said. The Sauls have four children — Ryan, Judd, Jaynie and Josie. Ryan, vice president of sales, helps run PIPAC and PIPAC LIFE, a company division. The other three children operate their own businesses. Judd owns Cohesion Productions, a highdefinition production company. He produced/executive produced a CD/DVD for rap artist Prozak that is in stores nationwide. Most recently he produced a documentary on professional video gaming called “Frag” being sold worldwide. Jaynie is the owner of Jaynie Mo’s Salon Spa. It opened in the summer of 2008 and offers the commu-
nity the newest and latest trends and technologies in salon and spa products and services in a pampered environment. Josie, the youngest of the four, is in the beginning stages of her event planning company called Fabulous Affairs by Josie. The Saul children see many advantages to owning and operating family-owned companies. Jayne Saul feels she is fortunate to have such great entrepreneurial parents. “I have the best teachers to learn from to run my business,” she said. Ryan Saul says one of the biggest advantages of being part of a family-owned business is the path of how decisions are made. “While large companies with many administrative layers and boards have to wait weeks or even months to make changes, we can make decisions on a dime,” he said. “This helps keep our response time to our agents at an almost “real-time” situation.” Greg and Lea Ann Saul are exceptionally proud of their excellent customer service and attention to detail that are given to the agents and the clients they serve. The employees at PIPAC and PIPAC Life are trained to emphasize service. Greg Nichols, Group Insurance Director, worked for a large insurance company for over 17 years prior to coming to PIPAC. “Working for a family-owned company has been great,” he
said. “The Sauls are in tune to the agents needs and also to us as employees. We are seen as people not numbers. Input and ideas are welcomed and valued here, you really feel like you can help make a difference.” And a difference the Saul family has made, not only for the employees and the agents they serve, but also for the entire community. Through the Greg and Lea Ann Saul Family Foundation, they have given to many charitable causes over the years including: UNI McLeod Center; Sturgis Falls Car Show, Cedar Falls Schools, Alternatives Pregnancy Center, American Heart Association, Sartori Festival of Trees, Mix Kids, and tornado and flood relief. Giving has always been the heart of their business and to the community. The Park Place Event Centre was built in 2004 to create a training facility for PIPAC agents as well as creating a beautiful building for community use. “We have always tried to fill a need for people; it has always been about doing something for someone else,” Lea Ann Saul said. “By building and owning the Centre, it has and is fulfilling the need for our community — to hold events for businesses and to create wonderful memories for families in a nice facility.” Penny Sund is director of marketing and creative services for Saul Management. Contact her at (319) 277-8541.
MAY 2009
Making your job a workout The Associated Press
Working out after or before work not working out? Make your desk a gym, says the Mayo Health Clinic. Some ways to incorporate exercise into office life: ■ When you need to talk to a co-worker, walk to other desks and offices rather than calling or instant-messaging. ■ Use a fitness ball in place of a regular desk chair. ■ When walking — to work or anytime — move quickly. ■ Instead of going on a coffee break, take a “fitness break.” Walk, do stretches or easy exercises with equipment you can store in your desk, such as resistance bands or small hand weights. ■ Find others who want to increase their activity level to join you on a lunchtime stroll. Regularly-scheduled exercise with a group makes you more likely to stay involved, the Mayo Clinic says, and is also a nice social opportunity. ■ Stand, don’t sit! Just getting up burns calories. ■ Make your commute an opportunity to move. Bike to work, or get off public transportation before your final destination. If driving, park as far away as is reasonable. And, of course, take the stairs. ■ There are treadmill desks on the market that let you use a phone and computer.
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Levi Brothers: A century of service At more than 100 years old, Levi Brothers Jewelers is one of Waterloo’s oldest businesses. In 1908, Julius Levi and his brother, recent immigrants from Russia, opened Levi Brothers as a small famScott Levi ily jewelry store along with brothers in downtown Brad and Greg, owns Levi Brothers Jewelry Waterloo. Today, and Loan in Waterloo. more than a century later, Contact him at (319) 233-6951. Levi Brothers is in its fourth generation. As a young man in the late 19th century, Julius Levi served in the Russian army at a time when antiJewish pogroms were spreading across the country. While many Russian Jews were being removed from their homes, tortured and even killed, Julius earned recognition in the army for his remarkable skill as a goldsmith, and he was provided a small shop to make jewelry for the officers. Julius’ brother fled Russia and made his way to New York, Chicago and then Waterloo, where he found work as a goldsmith. A few years later Julius joined his brother in Waterloo, and in 1908 they opened their own business: Levi Brothers. One year later Julius’ brother left for Chicago, and Julius took over as sole owner of Levi Brothers Jewelers. In those early years, much of the jewelry Julius sold was of his own design. Just a couple of his pieces remain in the family’s possession, testaments to his extraordinary artistic talent. Business was good for Julius and his wife, Ida, during the 1920s, but as unemployment across the nation skyrocketed in the Great Depression, many older Waterloo businesses failed. The crisis of the 1930s hit the jewelry business especially hard, and in an effort to keep his doors open, Julius entered the loan business. Levi Brothers survived the 1930s and, as the country moved from the Depression to the Second World War, Julius and Ida Levi’s only son, Jay, worked alongside
his father at Levi Brothers every day from 9 to 2, and then at John Deere from 3 to 11. When the war was over, Julius began searching for the relatives whom left behind in Russia, only to find they had all perished. In the late 1950s, Julius fell ill and had to retire, leaving the store to Jay. For nearly 30 years, Jay and his wife, Sosie, ran Levi Brothers, until a stroke forced Jay to retire. Jay and Sosie had two children, Alan and Rosemary. For many years, Alan had worked at the store on weekends, and when Jay became ill, Alan quit his job as manager of Krensky Fixture Co. to take over. For the next 25 years, Alan threw himself into running Levi Brothers, and he significantly expanded the store. Sosie continued coming to the store to work and visit with customers, many of whom had been her friends for decades. Many of them had parents and grandparents who were customers and friends of Julius and Ida, too. Levi Brothers has always been a special family business. The pawn business exists to serve people in need — people who live on a tight budget, who don’t have credit to get a loan from a bank and who need money to make ends meet. Pawnshops are a valuable resource for those who need a few extra dollars, whether it’s to pay an especially high heating bill in the winter, or to pay a medical bill. Of course, some pawnbrokers have earned reputations for exploiting customers. But from Julius on, Levi Brothers has always maintained a tradition of honesty, fair business practices and excellent customer service. More than anything else, this is what has kept people coming back to us through the years. Alan Levi passed away on Feb. 9. Now, for the first time since Julius’ brother left for Chicago in 1909, Levi Brothers is again owned and operated by brothers: Brad, Scott and Greg Levi. We are the fourth generation to run Levi Brothers, and we intend to honor our family’s tradition. It’s good business, and it’s good for the community.
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MAY 2009
Couple keeps food store healthy In September 2007, we purchased TnK Health Food Store, the oldest health food store in the area. TnK was started by Trainor and Keasey more than 50 years ago as a grocery store at the corner of West Third Street and Bayard. In the early 1970s John Bartels Ed and Mary and his wife, Marilyn, Altekruse purown TnK Health Food chased the busiStore in Waterloo. ness and turned Contact him at (319) it into a health 235-0246 food store. or toll-free at Pamela Shawver (888) 235-0246. purchased the store from Ed and Mary in the mid-1990s. In December of 1998 TnK was moved to it’s present location at the corner of Kimball and San Marnan close to the Fareway grocery store in Waterloo. Previous to purchasing the store, Marilyn had an interest in herbs and vitamins for many years and, in fact, has been with TnK for almost 12 years. John has an accounting background as well as retail management experience. These separate strengths provide a good blending. John handles the financial part of the business and Marilyn is in charge of product knowledge and customer service. “As much as I love this business, I wouldn’t have bought this business without John,” Marilyn said. “We enjoy working together. What makes our business successful? Our customers come first. Our customers keep coming back because they believe in quality products as well as excellent customer service. We stock products from reputable companies that are backed up by research. Our loyal customers trust in our employees’ knowledge of our
products we provide for them. Knowledgeable employees are vital to our business growth. We have a great responsibility on our shoulders when our customers come to us with questions seeking direction regarding their health concerns as they look to us for answers. Toni has been with the business for 17 years, providing simply the best service for TnK’s customers. Karla oversees the ordering of hundreds of products, as well as providing first-class customer service. Toni and Karla are like an extension of the family business as they are mother and daughter. Over time Toni has communicated to Karla a wealth of information about the natural products at our store. We all work together as a team. We have customers from many different cities and states. Several customers who have moved away from the area still continue to order from us, and we ship products to them. Operating a family business requires a great deal of time, attention, flexibility and patience. Now is a better time to own this business than when our three children were younger. We don’t have to be concerned about baby sitters, staying home with sick children or multiple after-school events. Owning a business does require putting in extra time other than just when the store is open for customers. By working together we see the accomplishments of hard work and know it is worth every bit of the effort we put in to our business. Family businesses provide a cornerstone to the economic stability of our country. Successful family businesses focus on people first. The strength of America is the honesty of the people blending their unique talents and responsibilities to enhance liberty and freedom of this great country of which we are all a part.
For breaking news coverage, photos and video updated all day
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A century of success at Fereday Heating It seems like yesterday that my dad tossed me the keys to Fereday Heating Co. and said “Going to Florida on vacation, not sure when I’ll be back. Good luck.” That was it. He was off to Tom Fereday a remote desis owner and tination where president of Fereday he couldn’t be Heating Co. in Waterreached. loo. Contact him at I was on my (319) 233-8411. own to run the family business my father and grandfather had worked so hard to build. I was both exhilarated and nervous. That was 40 years ago, and I’ve learned many valuable lessons working for my dad and working on my own. He knew I would make mistakes, but those mistakes would teach me to run the business. The lessons I learned were the principles on which our 100-yearold business was founded and remain our mission to this day. My dad taught me we were in business for two reasons: First, to provide excellent service to our customers; second, to make a fair profit. He would say, “Anyone who tells you they are not in business to make money isn’t telling the truth.” However, there are huge differences in approaches to profit. Our family’s business philosophy has always been to keep our profit margins fair. I have seen many unfair quotes (especially to elderly people), with drastically inflated profit margins that leave me shaking my head in disbelief. Our approach always will be to provide our customers with topnotch service and products while maintaining a fair profit margin. I also learned the importance of providing excellent service to our customers. My dad’s goal was to treat other people the way he wanted to be treated. This was evident in his decision to provide 24-hour service to our customers. He said, “It’d be a negative reflection on our family’s business if we made another family
wait in the cold until morning to fix their furnace.” He would have wanted that same service for his family. That’s why he offered it to our customers. While it’s not easy for our service guys to get out in the middle of a freezing January night, we just can’t leave our customers out in the cold. We offer 24-hour service calls because of my father’s philosophy of providing excellent customer service. My dad also taught me to serve as an advocate to our customers. In the 1950s, we educated our customers on gas furnaces when they were first introduced. We suggested that instead of fixing a broken oil- or coal-fired furnace, our customers could save money and have an efficient system by installing a gas furnace. We still act as advocates for our customers. We educate them on the latest technology and available rebates. For instance, the current stimulus package allows a tax credit of up to $1,500 in our customers pocket for putting in a new furnace. There are many utility-backed rebates available. We deal with these topics on a daily basis, while our customers deal with these topics infrequently. We feel it’s our duty to stay on top of tax credits and rebates, informing our customers of the opportunities out there for them. It has been an amazing 100 years for Fereday Heating Co. I was fortunate enough to work with my dad for about five years before he passed away. I learned so much about this business, both working side-by-side with him and after taking the reins. I take great pride in having learned these founding business principles from my father, who had learned them from his father. I have also been extremely fortunate to work with a very talented staff, which makes the whole company operate efficiently. And, where does Fereday Heating Co. go from here? Well, last month I tossed the keys to my son Charlie, and said, “I’m going to Florida on vacation, and I’m not sure when I’ll be back. Good luck.”
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MAY 2009
McGregors: First family of furniture Most industries and professions have role models. For many retail customers in the Cedar Valley, McGregors Furniture Co. is a successful model for longevity as a family business. McGregors is Iowa’s oldest family- owned Chris McGregor furniture chain. is the daughter of In 1896, James McGregors’ curMcGregor rent president, Jim founded the McGregor. She has first McGregors a thriving business store in Oskaof her own, but still loosa. The secserves as the company spokeswoman ond store in in McGregors' adver- the company, tising in newspapers and its current and on television. headquarters, was opened in Marshalltown by McGregor’s son, Charles, in 1928. James McGregor’s other son, James Jr., eventually took the helm of the store in Oskaloosa. Today, McGregors family members still own and operate the seven stores and associated warehouses serving Iowa and communities in surrounding states. The Waterloo store was added in 1946 and was the fourth store
in the operation. It was originally located on Fourth Street in downtown Waterloo, next to the original YMCA building.
moved to serve as McGregors vice president in Marshalltown, where he still works today.
The Courier connection
If there are any secrets to running this family-owned business, foremost among them would have to be hard work. All family members are extremely dedicated to the business. Both James Jr. and his brother Charles never retired, continuing to work until their deaths. James R. McGregor III, now in his 70s, still goes to work each day in Marshalltown. He does take one week off each summer to spend time with his extended family of seven children, 11 grandchildren and assorted friends at a resort in Minnesota, where the family has been vacationing for many years. Many McGregors employees have been with the company for decades, and now serve the grandchildren of McGregors original customers. McGregors
McGregors’ current president, James R. McGregor, III, worked at the Waterloo store for several years before moving to Marshalltown to work in the corporate office. While he was in Waterloo, he met his future wife, Mary, who was the girl who brought him proofs of his furniture ads from The Waterloo Courier. Jim and Mary raised seven children, two of whom are currently associated with the business. Chris McGregor has a thriving business of her own, but still serves as the company spokesperson in McGregors advertising. Erin McGregor serves as the operations manager of the company and works at the corporate offices in Marshalltown. Charles McGregor had three children, and his oldest son, Robert, joined the company in the early ’70s. Robert learned the business while working at the new Waterloo location at the Crossroads Center. He also served as manager at the McGregors location in Fort Dodge. Robert later
A family secret
has survived two world wars, the Great Depression and many other challenges to the family business over the years. One of their strengths — one important to suppliers during down times — is their policy of paying their bills in a timely manner. During World War II, when supplies of home furnishings and appliances were hard to come by, many factories would call on McGregors first with their available inventories.
Customer-focused
McGregors has always been very aware of what their customers want. As a buyer for the company, Craig Carter is keenly aware of the needs and desires of Iowa’s furniture customers. In addition, when the opportunities have presented themselves, McGregors has never hesitated to open a location in a town where there was potential to serve that town’s home furnishings needs.
McGregors advertising director Mark Stenson says, “Being customer-focused is a big key to McGregors success. With seven stores and so much inventory, we have tremendous buying power with suppliers, and that allows us to carry a great selection and offer more value to our customers.” Selection and value are important, but just as important, according to Stenson, are McGregors’ honesty and their sincere efforts to make sure every customer is satisfied. “I feel good going to work every day for a company I can be proud of, ” he says. History often repeats itself. As the old maxim goes, “The best predicator of future behavior is past behavior.” When McGregors says it will be here to serve customers tomorrow, it is easy to believe. After all, the McGregors family of furniture stores has already been waiting on customers for 113 years.
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MAY 2009
As electronics business evolves, so does Farnsworth A business must sometimes refocus its gears, especially in these economic times. I think back to when my grandfather, Gerald, first established the business, doing radio repairs in a New Hartford chicken coop with help from my great-grandfather, Ray. As technology advanced, he Anji Barnard went on to install is chief information sound systems in officer with Farnchurches, televisworth Electronics sion and stereo in Waterloo. Contact repairs and sold Barnard at (319) 234-6681. two-way radio systems and hospital radios. He also had the first car phone in Waterloo and played a key role in helping area radio stations and later television stations when they first went on the air. After purchasing the building we now call home 54 years ago, business continued to thrive. Eventually, there were 50 employees repairing phonographs and VCRs; installing sound systems in schools; and doing many other repairs. After serving in Vietnam, my father, Jim, returned to follow in the family tradition. He soon
opened stereo stores at College Hill and both local shopping malls. I can remember promotions at those stores with Playboy Bunnies, but with the weakening economy and the evolution of disposable electronics and chain stores like Wal-Mart, Jim had to refocus the business to selling industrial parts and supplies. Don’t think for a second the original persona doesn’t exist today. Jim’s wife, Robyn, has done repair work and soldering jobs since joining the company in 1986. I asked my father for a loan after I finished college and was unable to find a job. He offered a temporary job instead. I told him I had no interest in carrying on the family business, especially after having spent my summer vacations counting resistors. Anyone who has seen our resistor inventory knows what a huge, monotonous task that is. My father told me that work ethic was important, and when I did get a chance at landing a job my currently holding a job would look better to an employer. I think right then and there is when I began to appreciate the lessons my family taught me. After two months of pushing papers around, I got the business into the computer age. I think I
knew then — but didn’t want to accept it — that I was in it for the long haul. My grandfather would still come to work daily, quietly sitting in his office, just as I foresee my father doing 15 years from now. With the economy in a downturn once again, 17 years after I joined the business, we continue to remain flexible and strong. Being in business, you have to make some tough decisions. I think with a family business it’s harder because it’s family. You don’t want to step on anyone’s toes. You don’t want any hurt feelings. So you have to keep business somewhat separate from family. That is easier said than done. I think about the sacrifices that have been made for the betterment of the business. I also think being family-owned and operated, you take a little more pride in your day-to-day operations. An important lesson passed down through the generations is that a successful business, not just a family-owned operation,
needs to focus on customer service. We have many daily and weekly customers who are more like family to us than just an account number. We have found a niche, and I believe that also helps. The gears have changed through the years, but one factor has always remained the same: providing a quality product for a reasonable price. Everyone is out to make a quick buck, and there’s certainly nothing wrong with that. But I do like to sleep well at night. We’re honest and trustworthy, and I think you not only get that with a small, locally owned business, but more so the family-owned. There just seems to be an unwritten, unspoken knowledge between my father and me that I put in 200 percent, just as he did when he was my age. I do have to wonder about the future, though, considering I once said I didn’t want to carry on the legacy. Perhaps my younger brother, Jamie, will want to be involved someday. Time will tell. Another tough challenge is
being a businesswoman. Working hard isn’t enough; you really have to keep learning because of ever-changing technology. I wish I had a dollar for every time I heard, “I didn’t know this place existed!” I’d be pretty wealthy. Even if some locals don’t know we are here, customers in Europe, Australia, Jamaica, Canada and all across the U.S. do. It fascinates me to learn about where the parts we sell are going and what they are being used for. Just as if it wasn’t for our relative Philo T., we wouldn’t be able to watch television (or Farnovision as we around here like to call it). I don’t think being involved in a family-owned business is something that can be taught in school. Perhaps business, finance and accounting courses can be, but ultimately this is either in your blood or it’s not. There’s not one aspect of the business that I cannot handle, thankfully, from the teaching and learning from my dad, just as he did from his dad, and he did from his.
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Military requires family commitment, support When a military family is separated by deployment, the burdens on the spouse and children at home become too heavy to bear alone. Marriages are strained, resources are often strapped and hearts are overwhelmed by worries about Jocelyn Green the unknown future and the is an responsibilities award-winning freelance writer, of being solo for a former military long months on wife and author of end. “Faith Deployed: While civilians Daily Encouragement cannot truly for Military Wives” understand the (Moody Publishers of 2008). Visit the Web pressures site at www.faithde- d e p l o y m e n t , ployed.com. they can offer the support necessary to lighten the load.
Get your church involved
With record numbers of troops deployed or returned from the current war, most churches are in a perfect position to rally around and minister to families of service members. Here are just a few ways to provide reinforcements: ■ Send reverse care packages. Send care packages to the deployed members, and “reverse” care packages to the families on the home front on holidays and birthdays — whether it’s a gift card to Starbucks or a local spa, movie tickets or something else. Reverse care packages are a great way to serve that family and support the marriage, too. ■ Offer a military night out. Once a month, offer a Military Night Out where the church provides dinner and child care for children of the military member. The parents can go have a date night together, or if the spouse is deployed, the spouse at home can get a break from the kids and do errands, get together with friends or just have some time to herself. ■ Organize a returning veterans fellowship. Those coming home from combat need to be in fellowship with others who understand the special adjust-
ment issues they will be facing. Organize a simple gathering for veterans to benefit from being with others who understand exactly what they’re going through. ■ Honor the troops. Watch the calendar and honor the troops around Memorial Day, Independence Day and Veteran’s Day with special breakfasts for them or at least a mention from the pulpit. Show military members and their families (veterans included) that they are special.
Take personal initiative
No time to get a group together for an organized military ministry? No problem. Choose from this arsenal of ideas to personally support the military wife at home. ■ Create some coupons. Instead of simply telling a military wife you’re willing to help, give her a list of your services or create a coupon booklet for free baby sitting, a coffee date, financial counseling, running errands, an hour or two of housework, etc. It’s much easier for military wives to cash in on your offer to help if she knows exactly what you can do for her. ■ Surprise her. Make an ordinary day special by dropping off a basket of favorite foods, a great book or new magazine and/or a movie rental you know the military spouse or kids have been wanting to see. ■ Fix what’s broken. Find out what’s broken and fix it—or help tide her over until a professional can make the repair. If her computer is down, let her use yours to email her spouse. If the washing machine is on the fritz, let her do a few loads at your house this week. If the car stopped running, offer to give (or arrange) rides. ■ Get your hands dirty. For every season, there are jobs to be done outside. Pitch in when you can to mow the lawn, pull weeds, clean out gutters, shovel snow or wash windows. ■ Bring a meal. Providing a ready-to-eat (or ready-to-cook) dinner means one less thing an already stressed military wife would have to think about.
Be there
Visiting is a great mood lifter, but ask first before showing up unannounced. ■ Be consistent. Mark your calendars to send a small note or e-mail or phone call on a regular basis—not just right after the spouse deploys. And don’t expect a response each time. Support that wife regardless of if she
thanks you for every thoughtful gesture of yours. ■ Pray. Pray for the one serving our country overseas, but also pray for those serving at home—the spouse and children. Pray for the entire family even after the spouse returns home, too. That re-entry adjustment period is often just as stressful as deployment.
Supporting the military wife allows her to support her husband and children in a way that only she can. And knowing that his family is supported back home will allow the deployed spouse to better focus on his mission. When you minister to the military wives and children, you are supporting the troops, as well.
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Negotiation skills important in tough economic times Negotiation and conflict management skills are valuable in both your professional and personal life and knowing how to use these skills can be especially important in these tough economic times. We are repeatedly being told that we are no longer living under “normal” economic conditions. As stress in the workplace Lynette Wagner and at home is is a student at the increasingly University of Northern common, it is Iowa. Contact her at lmwagner@uni.edu. more important than ever to have a working knowledge of negotiation. Effectively utilizing the art of negotiation brings clarity to ambiguous situations, says Robert Himschoot. Himschoot is a longtime faculty member at the University of Northern Iowa and has conducted negotiation training programs and courses since 1975, including workshops with UNI’s Executive Development Center. A first step in negotiation is to identify a common problem to be solved (negotiated). To begin that process, each party would explain its “side” by fully expressing their concerns in their own words. This gives the participants the chance to state things from their perspective. An example would be negotiating a salary increase. The employer’s perspective may be that the company needs to contain costs. The employee’s perspective may be the increased cost of living must be covered (gasoline, college costs, food, etc.). Good negotiating and problem solving will help keep the concerns from escalating and also prevent positional bargaining. Examples of positional bargaining would be: “Give me a raise or I’ll quit,” (employee) and “If you’re not willing to work extra hours, you’ll be one of the ones we have to lay off,” (employer). The common problem is money, but each side sees it in an entirely different way. After identifying the problem, the next step in the negotia-
tion is to generate and evaluate alternatives. This would include the “give to get” scenario. The employer may suggest that the employee take on additional roles to help cut costs. The employee may propose a salary increase while agreeing to work some additional hours. With the continual proposal, explanation and counter-proposal, the participants will work toward reaching an accommodation that will satisfy both of them. Himschoot maintains that parties need to apply common courtesy and respect for each other when generating and evaluating alternatives. This practice is the opposite of what is seen in today’s legal arena and TV shows. Current TV programs seem to promote conflict and demonize the differing party instead of uncovering their needs. Knowing how to generate alternatives and how to keep options open empowers individuals and creates a foundation to achieve the best outcome possible for both parties. If a dispute is taken to court, there is significant delay, additional costs, a winner and a loser and a damaged relationship. Once all of the options have been explored and evaluated, selecting the most advantageous for both parties is the final step.
This process must encompass open communication and honest, courteous examination of the strengths and weaknesses of all of the choices. Instead of opposing each other, the participants can realize that working together to generate and explore options results in a better and longerlasting resolution. Individuals need to stay calm, use effective communication skills and help prevent each other from losing face. Making demands and takeit-or-leave-it offers (bottom lines) create a hostile environment and prevent understanding the other party’s wants and needs. When a resolution has occurred, it should be summarized so that each party has a common and clear understanding of the terms. It is important that this part of the process is not short-changed, because clarity at this point is imperative to the implementation of the agreement. Finally, a follow-up meeting should be established to reevaluate the settlement and ensure both parties are following through on their part. Talented negotiators are ahead of their colleagues and competitors in business and in life because they understand that building and maintaining relationships will enhance results. A balanced settlement will always
be better than an unbalanced one. According to Himschoot, “If each side is equally happy or unhappy, the negotiation is successful; they can still continue to do business and work together”. Some applications of enhanced negotiation skills in today’s world would include: ■ Negotiating better deals and contracts.
■ Increasing sales. ■ Reducing costs. ■ Dealing with difficult people. ■ Creating value with limited resources. ■ Improving relationships. ■ Adjusting your negotiation style for different situations. ■ Avoiding being cheated. ■ Becoming more comfortable with conflict.
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Brothers join forces to keep BW Contractors on the move By BRET WRAGE
BW Contractors Inc. is the creation of my brother, Steve, and me. Born and raised in the Cedar Falls/Janesville area, we were raised under the strict work ethic of our father, Marvin. After graduation, we went to work installing grain-handling equipment, both locally and statewide, and moved on to installation of larger industrialtype equipment. It was during this time that we got our knowledge and love of machinery moving and knew immediately that we had found our niche. In 1992, we started BW Contractors Inc. with one 5,000pound tow motor forklift and have spent the last 17 years adding to that collection and expanding the business. We now own numerous forklifts, including the 80,000-pound Rigger Special; 52,000-pound Taylor and the 40,000-pound Royal, semis, trailers and support equipment that has opened doors to bigger and more challenging projects. The biggest daily challenges are striving to meet customer expectations and time frames and making sure the equipment and crew fit the unique applications that accompany every job. I try to meet every potential client and give them the input it takes to make sure his/her relocation, bridge crane or new machine is handled in the most cost-efficient and safe manner possible. When I’m not on the road, I spend a lot of time on my computer inputting the data that will eventually become a proposal. Every job is unique, which is what makes this work so interesting. We have learned how to maximize our own flexibility to achieve your goal of minimizing downtime, and to serve all of your changing move requirements. We understand the complexities of machinery moving
Bret Wrage
Steve Wrage
Brothers Bret and Steve Wrage are co-owners of BW Contractors, Inc, Cedar Falls. Contact them at (319) 987-2070; toll free, at (888) 833-8852; or www.bwcontractorsinc.com.
and rigging, plant relocation and the cost of down time. That is why we treat every project as if it were our own. We will adapt to meet your specific needs, but most importantly, will work with you and your personnel to satisfy needs in a safe, competitive and responsive manner. Steve, on the other hand, feels that finding the talented and motivated individual that it takes to become a part of the team is a challenge all it’s own. “This work isn’t for everybody, and it takes a special kind of person to be able to blend with the crew and become a part of the team,” he says. “Safety is a major concern with this work. We spend as much time as possible reviewing safety issues, watching safety videos and just training on the lifts. We consider machinery moving and installation an art.” Steve also oversees all maintenance on equipment to ensure the forklifts and semis are always ready when it’s time to roll out on a job. “Maintenance is a must in this line of work,” he said. “Maintaining our own fleet of transport equipment is essential for quick response and on time performance.” In 2004, BW Contractors went through a major expansion, adding a heated building and an office and training center, all made possible by Community
National Bank and Black Hawk Economic Development. Storage of excess or new equipment had been an issue after receiving many requests from customers for just this type of service. This expansion allowed us to meet the needs of their customers with long or short-term storage. This service also allows their clients the ease of scheduling and receiving this equipment in a more controlled manner. This year, despite the recession, we are adding an additional service. Protective Matting Systems will be offering temporary flooring and portable access roadways. These unique mats provide support base, ground protection and access over soft surfaces. Using the matting system allows heavy work equipment into the job site while protecting the ground and your turf. We will be offering sales or rentals. BW Contractors has been a proud member of the Specialized Carrier & Riggers Association since 1996 and has been a member of the Cedar Valley Manufacturers Association since 1998. Steve and I agree that when the phone rings, you just never know what the job will entail. From suspending a P51 Mustang fighter plane from the ceiling in a museum, putting a 500-gallon fish tank in a home or installing a multi-million dollar machine in a manufacturing facility, every job has its own set of challenges. As longtime residents and business owners in the Cedar Valley, we realize the importance of “going that extra mile” to achieve customer satisfaction every time we work in a facility. From single machine moves to entire plant relocation, our people treat every customer with the same focus on detail that has given them a respected name in the community. Being a leader in our industry, means being a partner in yours.
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Withams thrives even with economy in low gear By Jason Witham
Perhaps the most common question raised with local business owners in the current economy is “how’s business?” Unfortunately, for a number of local businesses, sales are down. In our case, all things considered, business is pretty good. We have taken steps during the last several years to make sure that Witham Auto Centers concentrates on the business of meeting transportation needs for our customers. Dick Witham introduced our dealership to the Cedar Valley market 41 years ago. He built a solid reputation for auto sales based on delivering fair pricing, great selection and service after the sale. His loyalty to repeat customers and new referrals helped to establish a local tradition of providing reliable automotive solutions. The auto business became a family affair. My brother, Jeremy, and I were brought into the business on the ground floor. We learned to wash cars and maintain the sales lot before we were ever brought into the showroom. We were given an opportunity to learn all aspects of the business, especially the commitment to customer satisfaction. Little did either of us know that one day we would take the reins. As we got older, we met others in the business and found out that friends we had developed from childhood had migrated to the auto business, as well. In 2005, a great friend, Tim Godfrey, joined Jeremy and me in forming a partnership to purchase the Witham Auto Centers from my father. Each of us brought individual strengths to the partnership.
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Tim Godfrey brought a sales and inventory expertise to the business. Jeremy brought a keen understanding of automotive finance and credit services. My interests rested with parts, service and business operations. Our combined strengths have allowed us to continue to grow during a challenging economy. Because Tim, Jeremy and I were all born and raised in the Cedar Valley, we share a common set of core values. The families we serve are as important to us as our own. Once we purchased the business, we began to implement strategies that we believed would better serve the local market. We focused on providing product information through our Web site, www.withamauto.com. We recognized that we could reach more customers with better information in a more convenient medium by going online. Today’s auto buyers have access to more information about the quality, durability and cost of vehicles than at any time in history. We made decisions to expand and upgrade our dealership sites in Waterloo, Cedar Falls and La Porte City. In 2008 we introduced the Chevrolet brand to our facilities in La Porte. All of these upgrades are intended to
enhance our customers’ buying experience. Because of his extensive background in sales management, Tim introduced the concept of a guaranteed buying experience. Witham Auto Centers was the first dealer in the market to offer a three-day like-it-or-return-it guarantee, a $300 lowest price guarantee and a complete customer satisfaction guarantee. Our goal remains to be the number one customer choice for new and used vehicle purchases. The only way we have been able to uphold our three-point guarantee has been to maintain the best sales, service, finance and collision center employees any employer could hope to have. We employ over 100 skilled staff dedicated to providing the best results possible. Almost all of us who work here have lived in this market all of our lives. Our jobs and families depend upon us to make sure our customers are satisfied. The strength of the Ford, Chevy, Volkswagen and Kia brands has kept us very busy. The quality of our used inventory and our ability to secure competitive financing has further strengthened our ability to remain competitive. We are confident that
our manufacturers will respond to consumer demands for affordable and appealing eco-sensitive new product rollouts. The current economy will eventually bounce back as it always does. Meanwhile, we will continue to do our job. As relatively new owners of this multipoint dealership, the three of us know that the livelihood of all of us who work for Witham Auto Centers must remain true to our motto, “Everything We
Do Is Driven By You!” During a difficult economy transportation is critical. We recognize the challenges to families young and old, and we are convinced that we can match our products and services to anyone who is in need of a new or used vehicle. Jason Witham is general manager Witham Auto Centers Inc. in Waterloo, Cedar Falls and La Porte City. Contact him at (319) 234-4200 .
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Common philosophy delivers success to many While the shape of the automotive industry has changed dramatically through the years and continues to do so in these questionable economic times, one thing has remained constant: Rydell Chevrolet continues to follow the same phiMatt Halbur losophies it did can be contacted when it opened at (319) 389-8535. its doors 25 years ago. These philosophies and core values which have been handed dow n through this family business are critical to the success of the automobile buying experience. Jim Rydell, owner and president of Rydell Chevrolet in Waterloo and Rydell Automotive in Center Point and Cedar Rapids, is no stranger to the car business. Jim watched his father, Leonard Rydell, start a small car dealership in the 1940s in Montgomery, Minn., with strongly held business and personal philosophies that served him well. In 1954, at Chevrolet’s request, Leonard moved his family to Grand Forks, N.D., to operate a Chevrolet dealership there. Over the years, the Rydell enterprise has grown to become the largest dealer group in the U.S. operating under a common business philosophy, but under different individual ownership. The Rydell company philosophy
Get your money’s worth Advertising in the Cedar Valley Business Monthly is an efficient way to spend your advertising dollars. If you want to place a display ad, call an account executive at 291-1497 from 8 a.m. to 5 p.m. Monday through Friday. Our account executives will help you establish a campaign.
is based on five areas that are critical to business success. Those areas are customer enthusiasm, employee satisfaction, financial performance, market effectiveness and ongoing improvement. All are equally important. However, customer enthusiasm will always carry the most weight. The satisfaction of the customer throughout the purchasing and service experiences is the lifeblood behind everything Rydell does. The uniqueness of the Rydell Automotive Group is in the way it continues to grow the dealer group, which has expanded to nearly 70 dealerships in 11 states. The group’s vision statement, “to be so effective that we are able to be helpful to others,” supports what our organization is about. Every one of the 60-plus current locations is owned and operated by someone who has “grown up” within the organization while learning the common operating philosophy. The dealers have started in a Rydell store at almost every position including detailers, service technicians, parts department managers, finance and insurance department managers, sales consultants, used car managers and sales managers. The Rydell Co.
will provide the capital for the dealership, and the new dealer will pay it back from the store’s earnings until individual ownership is achieved. Once the buyout is complete, the dealer owns the dealership outright. Owners are autonomous, but attend quarterly meetings and adhere to the same philosophy of customer and employee satisfaction, financial performance, market share and continued improvement. This unique business practice attracts the best people in the automotive industry, which in turn provides the best experience for the customer. While sticking to the basics of honesty and integrity and not worrying about the big profit, but rather sales volume, Rydell Chevrolet has become one of the most widely respected car dealerships in Iowa. Rydell Chevrolet also operates under the best price upfront policy, which means there is absolutely no negotiating for the customer, and no back and forth from manager to manager. There are no games. In doing business this way, we have been able to attract customers from markets outside of eastern Iowa due to word of mouth and terrific customer experiences. No matter the economic times
or how the automobile landscape has changed over the last 25 years, Rydell has remained consistent with its practices in taking care of the customer and its employees. No matter what the automobile industry holds for the next 25 years, one thing will remain the same: Rydell will continue to operate under the same beliefs of honesty and integrity and to provide the best experience possible for the customer. In continuation of the family
business, my wife, Krissy (Jim’s daughter), and I have been with Rydell for the past three years, with a commitment to follow the same values and principles that have made Rydell what it is today. Jim Rydell has strived to be the most honest and strongest automobile dealer possible and has ingrained those values into his employees for the last 25 years. This mission remains the same today and for the future of Rydell Chevrolet.
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Union or nonunion, we’re in this fight together As our economy struggles to make a comeback, working men and women are finding it equally as tough to budget on minimal wages and benefits. Economist are saying the collapse of the auto industry will be the demise of Scott Grapp America’s union is president of United labor movement. Auto Workers Local As history has 838 in Waterloo. shown, when America’s economy has been depressed the labor movement has grown. America’s unions have paved the way to set
our working life as we know it. Higher wages, health care, pensions, retiree health care, paid sick time, vacations, bonuses, life insurance, safety programs, profit sharing, vision, dental, 40-hour work week, etc., were not given to workers out of the goodness of the companies’ hearts. These were benefits that were gained in fierce collective bargaining over the last 70 years. Iowans seem numb to the fact that plant closings, layoffs and cutbacks are a reality in today’s working environment. There are nearly six times as many Iowans currently unemployed as there are jobs listed on the Iowa Workforce Develop-
ment Web site. While 11 percent, or 300,000 Iowans, have no health insurance, of these, 19 percent are children. Iowa businesses fortunate enough to offer health-care benefits have had to absorb an increase in premiums of at least 58 percent since 1999. That’s 16 percent a year since 2001. Iowa also loses an estimated $60 million in tax revenue due to the high cost of health care on Iowa small businesses. UAW Amalgamated Local 838 (amalgamated means units that do not have enough members to make their own local) has felt the effects of a downtrodden economy, beginning with layoffs at two
of our amalgamated units, O’Neal Steel and Progressive Tool. Waterloo Warehouse is also seeing the effects with a cutback in their overtime hours. When we negotiate a new agreement in September with Deere and Co., we bargain with eight other John Deere sites in Iowa, Illinois and Coffeyville, Kan. Let me spell out for you how these other units are doing. Dubuque Works has 408 employees on layoff. Davenport works has 305 employees on layoff. Des Moines Works has 168 employees on layoff. Ottumwa Works laid off 40 and Coffeyville has 58 on layoff. Without these members work-
ing, it affects our bargaining. Layoffs, cutbacks, mergers, bankruptcies and plant closings are all too much the norm these days. As we cross our fingers and look ahead to what the future might hold, whether your union or non-union, we are all in this fight together. No matter what your party affiliation is, we need to come together and address labor bills in our state and at the federal level that seek economic and social justice for America’s working men and women. Our fight is here, its now, and people must stand tall, stand proud and stand together. Remember our slogan: “American Jobs are Worth Fighting For.”
At Habitat for Humanity, excitement is building The excitement is building — and building is what Habitat for Humanity does best — building homes and re l at i o n s h i p s and partnerships and hope and strong families and neighborhoods and communities. Iowa HeartLinda Morgan land Habitat for is executive director Humanity was of the Iowa Heartland founded in 1990 Habitat for Humanity. as an affiliate Contact her of Habitat for at (319) 235-9946. Humanity International and is a nonprofit organization seeking to eliminate poverty housing, build stronger families and improve neighborhoods. Habitat invites people from all walks of life to work together in partnership to help build homes with families in need. Locally, Iowa Heartland Habitat for Humanity completes eight to 10 homes annually. On a global level, since 1976, more than 1 million people in 3,000 communities are living in better housing because they have partnered with Habitat for Humanity to build themselves a better home and a more secure future. Houses are built with volunteer
labor, homeowner sweat equity hours, paid subcontractors and tax-deductible donations of money and materials. Habitat homes are then sold to Habitat families with affordable zerointerest mortgages. These mortgage payments are then used by the local Habitat affiliate to build more affordable homes for qualified families. In July, Iowa Heartland Habitat for Humanity will celebrate 20 years of building homes with families and volunteers. Our first home in Black Hawk County was a rehab in Waterloo completed in September of 1991. Our first home in Bremer County was a new home on 17th Street N.W. in Waverly, and our first home in Butler County, a flood-recovery home in Clarksville, will be completed this year. Iowa Heartland Habitat for Humanity has completed homes with 74 families in the past 20 years, and we currently have 15 families approved for Habitat homeownership. Heartland is unique because families are preapproved for Habitat housing. The process of Habitat homeownership begins with an application that is reviewed by a family selection team of Habitat volunteers. This team looks at: ■ Level of housing need.
■ Willingness to become partners and work 300 sweat equity hours. ■ Ability to repay the house loan from Heartland in an affordable monthly mortgage. Once approved for Habitat homeownership, Habitat families not only learn construction skills through their required sweat equity hours, but also attend classes in finances and budget, home maintenance, energy efficiency, gardening and landscaping, and family nutrition. Habitat families are also qualified because their incomes are no more than 60 percent of the county median income, as determined by federal guidelines. Their Habitat mortgage, paid to the local affiliate that holds the mortgage, is paid back at zeropercent interest over a 14 to 25 year term. The mortgage payments, plus donations, grants and government funds are used to sustain the Habitat affiliate and to build eight to 10 homes a year in our three-county area. To date we have built 46 homes in Waterloo, 13 in Cedar Falls, 11 in Waverly and two in La Porte City. Property taxes from Habitat homes totaled $70,000 in tax year 2008-09. This payout to counties, as well as local purchases of
construction materials and the use of local subcontractors, is a significant economic benefit to the communities where Habitat builds. Iowa Heartland currently has eight homes in progress — five in Waterloo, two in Cedar Falls and one in Clarksville. More plans for 2009 are to start and complete at least two more homes, for a total
of 10 new families in Habitat homes this year. Aggressive plans? Yes, but there are families waiting and working for affordable homes. Iowa Heartland has crews working six days a week to complete the homes in this year’s building plans, and the excitement is building the Habitat way, with Habitat volunteers and families.
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Building a business and a family takes teamwork When you say “family business” at our house, it sparks quite a conversation. Why? Because both my husband, Lynn, and I, own our own business while simultaneously being in the business of building our new family. Everyone Teri Trask is immersed in is with T2 Training. the celebrations Contact her at (319) and challenges 231-4959 or teri@ of each venture. t2training.net Married only nine months, we are building a household of faith with our blended family of five, working a 25-year lumberyard business and making a part-time speaking/training business a fulltime adventure. We are quickly discovering creating a new business and a new family have more similarities than differences. My husband, co-owner of Moeller & Walter Lumberyard in Reinbeck, has been in his business for 25 years, so he brings a lot of experience and expertise to the head of the table. He admits one of his driving forces when he bought the yard was “wanting
to do things his own way,” but has figured out that is sometimes easier at work than it is at home. He believes both require passion, priorities and positivity. His work and his family are both 24/7 callings and neither could survive without the support of the other. Lynn has been a role model for other small business owners over the years. He is respected for his solid work ethic, commitment to quality and community involvement. Lynn’s son, Shay, admires and shares his dad’s entrepreneurial spirit. While he may not have keeping the lumberyard in the family in his future, he does have aspirations to own his own business in a warmer climate. Cadi, Lynn’s daughter, and Josh, my son, have shown no interest to date in owning their own business, but both have taken community involvement and giving back to a new level as they plan for their mission trips to Kenya and the Czech Republic this summer. I was encouraged by Lynn to take my part-time speaking and training business, T2 Training, of six years to full-time status in 2009. I agree with Lynn’s phi-
losophy and rely on his business sense for the details. Being an educator at heart, I bring the other side of the balance sheet to life by promoting communication, cooperation, and continued celebrations to build a sense of community with my clients and our new household. I am doubtful whether any of the kids will follow in my speaker/trainer footsteps, but they definitely talk my walk now as some of my workshop lessons come right back to me at the dining room table. Filling your bucket, choosing your attitude, and someone having too much “I” or not enough “C” can be heard on a regular basis. This tells me they are absorbing the concepts when they are a part of my audience or joining me as part of a workshop facilitation team. Whether they are assisting me with a workshop, helping Lynn at the yard or picking up the slack at home it is a team effort. When we reflect on family and work, we agree we are all learning as we go and admit some of the lessons have been easier than others. What keeps us motivated is
Sour economy hasn’t changed plans to go green The Associated Press
A survey of small businesses showed owners reporting their grimmest outlook since August 2003, but two-thirds of them say their troubles haven’t changed plans to “green” their companies. The quarterly Wells Fargo survey of business owners’ sentiment notched in at -4, the lowest point since the poll began. While most businesses said they were going on with eco-friendly plans, two-thirds of the companies surveyed said their customers were not willing to pay more for environmentally friendly goods — up from 49 percent in spring 2007, the last time the question was asked. And 62 percent said they didn’t take any steps to showcase their environmental initiatives to customers, up from 49 percent in spring 2007.
For those who did let their customers know about their environmentalism, the 90 percent said they did so out of a sense of personal responsibility, while 73 percent saw it as a public-relations or brand-management move. In the past year, the two most common environmental actions were switching to greener products (77 percent), such as more
energy-efficient light bulbs, and recycling (88 percent). Another 28 percent said they volunteered to help the environment. The poll, by Wells Fargo, randomly surveyed 604 small business owners in January and February over the telephone. The margin of sampling error is 4 percentage points.
the daily blessings recorded in our gratitude journal and the joy both our work and family bring to us. There is a saying in our office that helps keep us on track and reminds us to strive for balance — “Never get so busy making a living that you forget to make a life.” Our kids, friends and family help keep us honest with
this and make sure we block out time to attend events and pursue hobbies. The glue that holds it and us together is our faith. We know there is a meant to be component in the building of our business and our family as “There are no accidents in the kingdom.” When we hit a bump in the road, we simply know we have to believe.
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Downtown Waterloo experiences a spring of its own I’m not sure if spring is busting out all over, but downtown Waterloo definitely is. With the brief respite from winter on St. Patrick’s Day, the bars and restaurants were literally bursting at the Sindee seams as people Kleckner flowed out onto is executive directhe sidewalks tor of Main Street Waterloo. Contact her downtown. Not only is my mothat (319) 291-2038 er Irish, but I or kleckner@mainstreetwaterloo.org suspect Mother
Nature may be as well. While Mother Nature may have thrown us a few curve balls, soon enough we will all be donning our sandals as we relax and enjoy the warm weather. Spring and summer are the perfect time to come Downtown and catch a drink with a friend, let someone else do the cooking, people watch or enjoy the sun. Nowhere is the idea of sunny days to come more evident than at Barbados Island Bar located at 229 E. Fourth St., across from the Screaming Eagle American Bar and Grill. While the building has been through a few different
uses (last known as the Southern Soul Club) Barbados Island Bar sets itself apart through its brightly colored island theme, down to the thatched roof over the bar. You can truly get away without having to travel too far from home as you enjoy a lunch or dinner of such island treats as tequila chicken and crystal coconut shrimp. In addition to eating, drinking, and soaking up the ambiance, you will be able dance away those winter blahs in the Boom-Boom room. Barbados was scheduled to be open by April 25.
Organize to stay on top of details Have we prepared young people to run the business? I have not found a part of life untouched by organizing, and that includes running a business. Once you control the chaos, you will have an easier time performing business functions. Jessica Crouch is the Shaklee direc- Plus, organizing tor at Organized For may allow you to improve cusYou. Contact her at (319) 504-6689 or tomer service, jessica@organizgrow your busieanywhere.com. ness, increase profit and reduce stress. ■ Clutter — When you run a business, you need to document everything. Find the organizing solution that keeps your desk clear and your documents easily accessible. Organizers range from standing units to hanging bins to tiered, desktop units. Take stock of your work space and pick the product that allows you to find
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what you need when you need it without impeding daily activities. ■ Computer — Now apply the same principles to your computer. When you create folders, start with broad categories (such as client) and work toward more specific groups. Organizing your computer files can save time, space on your hard drive and memory. If you constantly acquire new data and files on your computer, you may need to regularly transfer old files to a different form of storage (i.e. CD, flash drive, etc.). ■ E-mail — Organizing can keep things from falling through the cracks. When you create rules, folders and a regular time to take care of e-mail, you can easily find and respond to important messages, retrieve messages and bring less stress to your computer. You may also want to create different e-mail addresses for different business functions or
departments to help categorize and organize your emails. ■ Plan — From a business plan to a daily plan, you will have a hard time avoiding plans if you want efficiency in your business. That includes planning for the unexpected. Pick a planner, calendar or scheduling system that suits your personality and schedule. Whatever you pick, only choose one. Multiple calendars that do not link leave you open for missed items, double booking and unhappy customers, both internal and external. ■ Contacts — Connecting with others for invoicing, proposals or replies could make or break your business. Create a contact management system so you never miss a customer again. Your customer service should set you apart from your competitors. Make a good first impression and build a lasting relationship by making good connections with your contacts.
Before you get out your sandals and get ready to step into the sun, you will want to make sure you look and feel your best. Beau Monde, a new boutique and salon is scheduled to open next to Classic Kitchen & Bath in downtown Waterloo this May. Beau Monde is located at 224 E. Fourth St. (formerly Home Comforts). The salon will have
five stylists and plenty of room to relax as you get a pedicure, manicure, facial, massage and hair cut or color. Lunch specials, spa packages and a “Girl’s Night Out” are also in the plans for this new business. I don’t know about you, but I for one look forward to putting away the winter coat and busting out the sun tan lotion.
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Spouses play key role in family business Many family-owned businesses recognize the contributions a spouse offers. Business owners often gamble on the probability a successful partnership at home will translate into a productive and rewarding relationship at work. Andy Miller There are is co-owner of pros and cons Service Roofing Co. in Waterloo. Contact to working with a spouse and him at important things (319) 239-4737. to remember to avoid the pitfalls. Service Roofing Co. has a long history of owners drawing from the talent of spouses for the benefit of the business. This family-owned business has seen husbands and wives working together successfully for 73 years, starting with company founder Marlin Crisp. Marlin’s wife, Margaret, assisted not only in the office; she also found herself up on a roof or behind the wheel of a forklift when required. When Jay Crisp took over the business, he followed his father’s precedent, working with his own wife, Maureen.
Service Roofing Company is still a family-owned business which I co-own with my partner, Chuck Schulte. We, like the men who came before us, work with our wives on a daily basis. Chuck Schulte’s wife, Linda, has worked with her husband for 22 years. She serves as the office manager. My wife, Jessica, joined the business in 2005 and spearheads marketing and administration. My wife and I make a good team because we balance each other out. Having different strengths and skill sets, our partnership allows us to focus attention on areas where our talents are best utilized. Jessica and I are accustomed to this dance, as we have co-chaired and worked on many community projects together. That being said, there are challenges to working with your spouse day in and day out. Initially, it may be difficult to get acclimated to a different environment in which a spouse wears another hat. There are times when the stress outweighs the laughs. It is important to prevent bad days from following you home. Chuck, and his wife, Linda, set a time limit on conversations concerning work after the work-
day has ceased. They are conscientious about honoring this agreement, and it has proven to be an effective strategy. Another area of concern is that spouses may spend too much time together. Even the closest pairs need time away from their significant others. We devote time to pursuing individual leisure and community activities. A big risk to working with your spouse is having all of your eggs in one basket. There is a lot riding on the success of the company. All of the families’ incomes are based on the profitability of our co-owned business. It is nice when spouses have a real understanding of the challenges of work. There is no one at home wondering why you are late for dinner. The flexibility of being able to utilize a tag-team approach to taking care of both business and family is priceless. The Schultes saw this as an asset while their children were young, and continue to enjoy flexibility with their grandchildren. My wife and I cannot imagine how we would have managed our 4-year-old daughter’s cancer diagnosis and treatment over the past year had it not been for the luxury of
Extended unemployment isn’t fatal for managers’ careers The Associated Press
Being out of a job for an extended period no longer carries the stigma it once did for top managers, according to a new survey. A top manager can remain unemployed for nine months without it hurting his or her career, according to telephone interviews with 150 senior executives by Robert Half Management Resources. Most hiring managers recognize the economy has sidelined many capable and experienced people, said Paul McDonald, executive director for the unit of staffing company Robert Half International Inc. Robert Half gives these tips for the senior-level job-seeker: ■ Be flexible. You may not find a job that is an exact match with
the one you held before. Explore ways to apply your expertise in new areas and highlight your transferable skills. ■ Network effectively. Make sure your network includes people at varying experience levels and those outside your industry. ■ Know the company. The more you can uncover about a busi-
ness’ strengths and weaknesses as well as its corporate culture, the better you can tailor your application materials to the firm’s exact needs. ■ Consider relocating. Be open to opportunities in other cities or states, particularly if your skills are highly specialized or few job openings exist locally.
being able to rely heavily on this team approach. It enabled us to take care of business at home as well as in the office. In addition to flexibility, the emotional support and understanding of a spouse who has knowledge of what happens at the office is a priceless perk. We are all fortunate enough to rec-
ognize the benefits of working together and are convinced that the advantages far outweigh the challenges. You not only share war wounds and stressors; you also have the unique experience of being able to build something together and to celebrate the joy of every accomplishment side by side.
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Family attitude keeps business flowing By DAN BUSH
In the early 1970s, my wife and I moved to the Waterloo area, where we learned a great deal about each other. We quickly learned each others strengths as well as shortcomings. I also learned early on that I was able to do what I did because of the help she was by doing what she did. A mutual respect was born, and we continued to work together for over 20 years until she got sick. A good friend of the family
came in to our home-based office and helped us out for as long as s he could until my wife passed. After my wife passed away, I searched for a long time to find someone that would fit into a pattern to which I was accustomed. I got lucky and was able to find an office manager who fit into the comfortable pattern that I thought I would never have again. My wife and I became foster parents, and some of the 15and 16-year-old boys would help me with the business in order
to earn spending money. Along came Rick. He showed more than a passing interest in the business. He learned very quickly and, the older he got, the more dependent upon him I became. He was the son I always wanted. By living with us, he was able to learn all aspects of the business. As we go along, I look forward to being able to step back and let this deserving young man take over the business. When that time comes, the transition will be smooth, because he
Don’t ask them to show you the money until second interview The Associated Press
Wait until your second face-toface talk with a potential employer before broaching the money question, said recruiting specialist Brett Good. Good, who works for staffing company Robert Half International Inc., said the interviewer should launch the compensation topic, but if by the end of a second in-person interview, salary hasn’t been addressed, ask about it, partly in order to gauge your chances with the company. “You’re not talking about dollars
unless you’re genuinely interested in bringing the person on board,” Good said. He recommends initiating the discussion with a “range of compensation” that would be acceptable, and working out the details later. Don’t be premature with money talk, don’t fixate on it, and don’t be aggressive in demanding a certain salary before building a rapport with a company, he said. Those doing the hiring shouldn’t lowball prospective employees, Good said. Candidates may flee, or upon working out a better
offer, may think that all details are up for negotiation. Too-low offers can also hurt a company’s reputation as a good place to work. If a salary offer falls below your desired range, be honest. For would-be employees and employers both, he recommends walking away from a salary mismatch — even in a recession.
grew up in this family business and has worked hard to learn all that I could teach him, mostly by watching and helping. It has been fun to watch him, because he has the same passion for helping others as I have. A pride builds that is hard to explain in words. I am proud of the business that we have built and proud of Rick for understanding me and enjoying the business as much as I have. As a family, you can set the same goals and be able to make the same sacrifices to achieve
what you want. The growing together doesn’t stop it justs gets easier as time passes. With the lack of work ethics of today’s work force, I feel very lucky to have a son that will not only be able to step into my shoes but wants to as well. The business my wife and I started, will still be here long after we both have gone. Dan Bush owns Drain Doctor, a sewer and drain cleaning service in the Cedar Valley. Contact him at (319) 232-2444 or (319) 277-3730.
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Business tax planning should be year-round process ■ Say you just filed your tax return? Time to get ready for next year. NEW YORK (AP) — It can be tempting for small business owners, once their income tax returns are filed, to put the whole issue of taxes behind them. Resist that urge. Owners who don’t grasp the idea that a company’s tax planning — in reality, overall business and financial planning — is a year-round process may be setting their businesses up for an even tougher time in this difficult economy. They might also miss out on some tax law changes that are designed to help small businesses get through the recession. “They’ve got to keep their eyes open relative to what’s happening on the budget level,” Barbara Weltman, a tax attorney in Millwood, N.Y., and author of “J.K. Lasser’s Small Business Taxes,” said of business owners. It’s hard to run a business and keep up with tax law or economic stimulus legislation. That’s a good reason to stay in touch with a tax or financial adviser whose job is to know what changes are coming down. And it’s not
just the federal government that’s making adjustments; states are also passing laws, and some including California need to raise taxes to close budget deficits. Some changes in federal tax law for this year are already known. The IRS Web site, www. irs.gov, has a section devoted to the provisions on its home page. Click on “Update on Recovery Tax Provisions for Individuals and Businesses.” Or, you can go straight to changes aimed at small businesses by clicking on www.irs.gov/newsroom/article/ 0,,id205330,00.html. Among the small business provisions: ■ Companies that incur net operating losses can carry them back five years instead of the usual two, applying those losses against taxes paid in the past and obtaining refunds. ■ When making estimated tax payments, businesses are required to pay only 90 percent of their previous year’s taxes, down from the usual 110 percent. Weltman noted that this change may be a big help to companies. “What this does is improve cash flow,” she said. ■ The sharply higher deductions for new equipment purchases enacted for 2008 are being
extended into 2009. One of these provisions is the Section 179 deduction, which allows small businesses to deduct upfront the cost of equipment such as computers, furniture, manufacturing machines and vehicles, up to $250,000. The second is the bonus depreciation measure that increases the portion of a purchase price that can be deducted for the first year. There is also a break for people who invest in small businesses — if they hold their investments for five years, 75 percent of their capital gains will be exempt from taxes. Some of these provisions are straightforward, especially the carryback and estimated tax changes. But the others are more complex because they depend on strategic business decisions that are made throughout the year — and that probably should be made in consultation with a financial professional such as an accountant or tax attorney whose expertise goes beyond the Internal Revenue Code.
Weltman said owners should be sure the professionals they hire are “more than just tax advisers, that they’re business advisers. ... Maybe you’re not doing things right with your inventory, maybe you should be warehousing differently. Whatever the issue is, you need someone who can help you.” Owners need to take advantage of that help on a continual basis. That means not just calling for advice about big purchases or other strategic decisions, but also scheduling semiannual or, even better, quarterly meetings with
their accountants or advisers. Some owners go further, giving their accountants financial data each month. You can argue that working closely with an adviser is a good business practice in the best of times. Given the flux in the economy and therefore the evolution in laws that affect small companies, right now it can be critical. It not only keeps your company operating better, it frees you to focus on your customers and employees and preparing your business to benefit from an economic recovery.
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Government takes steps to make SBA loans easier to get NEW YORK (AP) — Small business owners who have watched banks and automakers get assistance from the government can now receive some help too. The government is making it easier for companies to get loans from the Small Business Administration. It’s eliminating fees on its most popular loans, known as 7a loans, and guaranteeing a larger portion of the amount borrowed. It’s also eliminating fees on what are called CDC/504 loans. Small businesses will also benefit from the Troubled Asset Relief Program, or TARP, that’s bailing out banks. The government will use $15 billion in TARP money to buy already issued small business loans in what’s known as the secondary market. That plan, according to SBA spokesman Mike Stamler, will enable lenders to get old loans off their books and allow them to create new ones. The slowdown in credit markets has made it harder for banks to sell their loans and move on to the next borrower. “Maybe that pulls the twig out that’s holding the logjam up,” Stamler said. Small business lending as measured by approvals of 7a loans has plunged over the past two years. In 2007, when the economy was still doing well, just over 99,600
loans totaling $14.3 billion were OK’d, according to the SBA. Last year, those numbers dropped to 69,434 loans and $12.67 billion. So far this year, loan approvals are down 50 percent from the same period of 2008. More than 15,400 loans totaling $3.2 billion have been approved. The SBA’s 7a loan program is intended to help small businesses borrow for a variety of reasons when they haven’t been able to get a loan otherwise. The key feature of these is the government’s guarantee of a substantial amount of a loan, which removes much of the risk from the lender. But even that guarantee hasn’t made small business borrowing easier, Stamler said. So the government is increasing the portion of a 7a loan it will guarantee to 90 percent from the previous amount of 75 percent to 85 percent. The upper limit for guaranteed loans remains unchanged at $1.5 million. “A loan that the lender might not have considered before, he may consider now,” Stamler said. The government is taking these steps recognizing that companies need more help in tougher times. But that doesn’t mean a business that is poorly run or on the verge of collapse can now get a loan. As the SBA says on its Web site,
a business must be able to show that it has the wherewithal to repay the loan. “If you couldn’t get a loan two years ago, you’re not going to get one now,” Stamler said. But, he said, “If it’s a viable business that is just having immediate financial hardship, and if it can get over the hump for the next three or four months, a lender might see it as a reasonable risk.” The government is also eliminating the fees that borrowers pay on 7a loans and on CDC/504 loans. CDC/504 loans are granted by what are known as Certified Development Companies, which are nonprofit corporations set up to aid the economic development of a community. Small businesses can take out these loans to finance purchases of fixed assets such as buildings or land. The government does not guarantee CDC/504 loans because the assets serve as collateral. The higher 7a guarantees and the fee eliminations will remain in effect until Dec. 31 or until the funds allocated for both purposes,
approximately $8.7 billion, are exhausted. Stamler said the SBA is estimating that there will be enough funds to last through the calendar year; that means business owners are not under pressure to seek out a loan right now. The SBA Web site has a section devoted to explaining its loan programs, including eligibility requirements, at www.sba.gov/ services/financialassistance/sbaloantopics/index.html. Business owners can also call the SBA at 1-800-827-5722 for information about loans. Small businesses can get advice on financing and SBA loans from
SCORE, an SBA-sponsored organization of retired executives who counsel owners. Its Web site is www.score.org, and counselors will dispense advice online. Small Business Development Centers, also sponsored by the SBA, are often located at colleges and universities, and there are more than 1,000 across the country. They can be located online at www.sba.gov/aboutsba/sbaprograms/sbdc/index.html. Banks that make SBA loans will also have information about the application process and what small businesses need to do in order to qualify for a loan.
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Lending problems hamper small business sales NEW YORK (AP) — Andrea Edmunds got a great deal when she decided to buy a small business. But that still didn’t make it easy. Edmunds recently bought back PoshTots and PoshLiving, two linked retail companies she had co-owned until three years ago. The firms’ new parent company was in bankruptcy court and Edmunds wanted to buy the businesses back, even though the companies’ sales were way down and financing is hard to get. “I had enough confidence and faith that it’s going to turn around,” Edmunds said of her businesses and the economy. Edmunds managed to accomplish what many would-be entrepreneurs are hoping for in a troubled economy: to buy a small business despite the many obstacles that are making deals hard to complete. Business brokers, who bring buyers and sellers together, say there are a growing number of people who want to buy, including many who lost their jobs over the past year and need to make a living. And there are plenty who want to sell, including baby boomers hankering for retirement. Getting financing for deals is still tough, although the govern-
ment has taken steps to make Small Business Administration loans easier to obtain. The brokers say banks are not only uneasy about borrowers, they’re also questioning the health of the companies up for sale. “Even with those changes, we feel that it seems as if the money may never reach the small business owner,” said Jeff Hoops, senior vice president of The Haley Group in Paso Robles, Calif. Small businesses have found it hard to borrow from banks for years, long before the recession; a neophyte owner or company has been too risky for many banks to take on. The recession and banks’ unwillingness to lend in general over the past six months have made it that much harder. Edmunds said her financing came from a private, locallyowned bank that was supportive of her plans. The fact that she knew her businesses so well was a plus, and the purchase price was down dramatically — $735,000, compared to the $12 million she and two partners got three years ago. The companies, based in Glen Allen, Va., sell upscale home furnishings. Brokers are seeing lower prices in general along with fewer transactions.
Peter Berg, managing director of Transworld Business Brokers in Fort Lauderdale, Fla., said the volume of deals his firm did last year fell 10 percent but the value of all the deals put together went down 30 percent. Meanwhile, deals are taking longer to complete while banks give prospective borrowers and companies much closer scrutiny. Emmet Apolinario, who owns a Sunbelt brokerage in Columbus, Ohio, said that before the credit crisis, a purchase could close in 45 to 60 days after an offer was accepted. Now, one of his pending deals will take five months to close. Would-be buyers have been hit in several ways. Besides the bank financing issue, the nest eggs they would have used for down payments have shrunk as the stock market plunged. They can’t draw on home equity because housing prices are down, and if they already had a home equity line of credit, their banks have very likely pulled the accounts
or cut them drastically. Also, banks that are willing to lend are demanding bigger down payments. Sellers have their own set of problems. More of them are having to act as lenders to close the deals. Apolinario has been telling them, “there is no way I can get you 100 percent cash. You will have to provide some seller financing.” That does have an upside for sellers, though: They get income from the interest on the loans they grant their buyers. But, Apolinario said, many owners are also finding that they can’t get the price they expect on their companies; these assets have fallen in value along with real property and stocks. Brokers see small signs of a possible pickup in deals. Apolinario said the SBA loan changes have led to more prospective buyers calling. Berg said he sees many people actively looking for a company: “They either have been laid off
or are afraid of being laid off and want to be pre-emptive.” Still, he said, “it doesn’t mean an uptick in the number of transactions. We’re just seeing an uptick in the number of inquiries.” Hoops expects the climate for buying and selling to start picking up perhaps as early as June, “when people get comfortable with the fact that they’re going to have to live with this (economy) for a while.” He expects prospective buyers to say, “things are bad, but I’ve got to plan for what I’m going to do next, no matter what happens in the economy.” Franco Ferrari, owner of a Sunbelt business brokerage in Casselberry, Fla., near Orlando, expects that the entrepreneurial spirit is what will bring more buyers in, rather than expectations that government steps will heal the economy. “There’s confidence in their ability as a mom and pop operator that they can go in there and make that business produce,” he said.
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Entrepreneurs find upsides in home-based business NEW YORK (AP) — For many of the millions of Americans who lost their jobs over the past year, the next step is starting a business. And many of these enterprises are being launched out of the entrepreneurs’ homes. Owners of new home-based businesses find there are pros and cons to running a company out of a spare bedroom or den. The upsides include a more flexible lifestyle and huge cost savings. Among the drawbacks: having to work alone, without a dedicated support staff, and keeping work and personal lives separate. Joanne Hakim, who recently started her company, The Pen Is The Sword, in her house in Norwood, N.J., finds that a homebased business can be isolating after the experience of being surrounded by many co-workers. “I took for granted the interaction that I had with colleagues every day,” said Hakim, whose business includes copywriting, editing and design. “You fail to realize the importance of stimulation in your life.” But, she said, “you don’t have the constant interruptions that you do” in a workplace with many other people. The transition can be easier for other owners. Charlene Li, who runs her new business, Altimeter
Group, out of her San Mateo, Calif., home, was used to not having face-to-face contact with staffers or clients, since many were in other cities. She had a different challenge: She no longer had an information technology department to turn to for help. “I’m a pretty techie person, but I still had a hard time figuring out how to set things up,” said Li, who has a consulting and speaking business. One of the great advantages of launching a home-based business is the extremely low startup costs — aside from a PC, printer, fax machine and office furniture, the expenses are minimal. Hakim said if she had to rent an office and start furnishing it, “that would involve an expense that I probably would not be ready to take on.” “You can’t beat the overhead” of a home-based business, Hakim said, noting also, “you can write off part of the house.” The IRS allows owners of home businesses to deduct part of their expenses including mortgage interest, repairs, utilities and insurance. Owners determine how much of the square footage of their home is dedicated to the business, and that percentage of expenses for the home can be deducted. That portion of the house can also be depreciated.
Some owners may be wary about taking a deduction for a home office because it was believed in the past to make a taxpayer vulnerable to an IRS audit. Tax professionals say that’s no longer the case — as long as the deduction is reasonable. The IRS has information about the home office deduction in its Publication 587, Business Use of Your Home. You can access it on the IRS Web site, www.irs.gov/ publications/p587/index.html. Some owners might find, if they’re inviting clients, vendors or other business people into their homes, that they need to do a little decorating — including putting toys and bicycles away, and perhaps banishing cats and dogs from the rooms where visitors will be. Li does teleconferences from the room that serves as her office, but positions the camera so participants see professional-looking bookcases. If it’s just not feasible to have business meetings at the house, owners can rent office space or meeting rooms by the hour, or
perhaps use the office of a friend or relative. Family members may well need to adjust to the presence of a business in the home — which can be difficult for younger children. Li, who has two children ages 8 and 10, said, “the hard things have been to train them, when my door is closed, to not come in.” She recalled being on the phone when her daughter came into her office, demanding, “come on, Mom, fix dinner.” At the same time, Li said, “they love having me in the house. If they really need me, they can sneak in and say, ‘can I ask you a
question?’” A home business can also give a parent more flexibility to chauffeur children to and from activities, and to attend school plays and basketball games. That might mean working early morning hours or evenings, but the homebased entrepreneur truly can be the boss of his or her time. But it also creates more flexibility, and in turn, can lead to more opportunities. Hakim finds that having a business at home makes it a lot easier to work with overseas companies — including some in India, which is about 10 hours ahead of Eastern time.
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Disaster preparation doesn’t have to be overwhelming task NEW YORK (AP) — The harsh weather of spring, including hard rains, flooding and tornadoes, has already hit parts of the Midwest and the South. It’s a reminder to small business owners everywhere that they need to be ready when disaster strikes. Preparing for disaster might not seem like a priority to a company owner who’s trying to bring in sales and cut costs during the recession. But planning that goes into mitigating the impact of a disaster can also help your company’s operations when all is well. Donna Childs, whose financial services firm was dislocated by the attacks on the World Trade Center in 2001, said disaster planning is often neglected. Many small business owners feel overwhelmed because they see disaster preparation as a huge task.” A disaster doesn’t have to be an extraordinary event wrought by nature — fires and vandalism can disrupt a business as much as the weather can. And it doesn’t have to damage or destroy your premises; a road that washes out and prevents you from getting to your
building can do plenty of harm to your sales and profits. The way to ease disaster prep anxiety is to break it down into manageable components and tackle them one by one: protecting your data, creating a backup communications network, setting up an alternative power supply. Childs, who has written “Prepare for the Worst, Plan for the Best,” a guide to disaster planning for small business, noted many problems that occur in a disaster are also ones that could happen in the best of times. A power outage can happen anytime. Backup generators will keep you running whether it is brownout or tornado that knocks out power. Every company should be thinking about backing up its data for the most mundane reasons: an employee accidentally deletes an important file or a hard drive crashes and the data cannot be salvaged. Having an offsite data backup and recovery system is a good way to be sure your data is retrievable, and this will also make it easier for a company to keep operating after a disaster.
Companies that are service providers and don’t need to rely on stationary equipment in a specific location probably will have the easiest time disaster preparation. Laptop computers and smart phones equipped for Internet access allow business owners and their employees to take the company with them. Childs said the benefits of disaster preparation go beyond ensuring that a company can get back to work quickly if the worst happens. Owners can use their plans as a selling point with potential customers. Another way to make disaster planning easier is to put together a checklist of what you need to do, decide which items are a priority and start addressing them, delegating as much as you can to employees (for example, creating and maintaining a contact list that will let you know how to reach your staff and customers). If you’re not sure what should be on that list, there are disaster planning books, and the Internet also has resources. The Institute for Business &
Home Safety has a checklist on its Web site, www.disastersafety. org, and the federal government also has guides at www.ready.gov/ business, and the Small Business Administration Web site, www.
sba.gov/beawareandprepare/business.html. Insurance brokers can also be a resource, and so can other small business owners in your area or in your line of work.
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Some firms scaling back parting pay The Associated Press
Rising layoffs are making companies think twice about their severance plans, according to a recent survey. Companies are thinking about changing the makeup of the packages they provide to outgoing non-executive employees, which often include cash payments and benefits such as health care and outplacement assistance. The poll, by Hewitt Associates in December, elicited replies from 228 companies about their severance packages for non-unionized workers. Nearly a third of companies’ humanresources departments said they were thinking about changing their plans, while 20 percent said they definitely were — with the greatest change coming in reducing cash payments. Of the companies surveyed, 80 percent had cut jobs in the last two years, while 45 percent intend to cut positions in the next 12 months. In the past, companies tended to vary severance packages from layoff to layoff, said Hewitt Associates senior consultant Lori Wisper, the lead author of the survey. Nowadays, with layoffs becoming a significant factor of corporate life, companies are formalizing or instituting severance procedures, she said. In her experience, auto companies tended to offer the richest packages, while retail and banking severances were not as generous — probably due to the influence of unions on the autos sector, Wisper said. While 43 percent of those who said they were making changes in their severance policy said they were reducing payments, most of the respondents said they did not keep track of how much their most recent severance packages had cost them. Of the 13 percent that said they did, the average cost per laid-off employee was $34,000.
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