Have you ever wondered why people buy products and services from you or anyone else for that matter? Why do people love an iPod, why do they buy a Rolex watch? The reason is always the same, it makes them feel good. It helps people to feel calm and secure, or superior - these feelings are deeply satisfying to all of us.

Is that the only motivation why people buy, I don’t think so. The other reason is to avoid feeling bad. Feeling bad may have to do with feeling pain, losing money, loosing business, being hassled, feeling guilty and so on.

Bottom line? If your product and service does not do one of the two, you may have a problem. ST.

This at least is one of the theories why good businesses begin to flounder. You worked hard to get to a profitable position in your business and believe it is time to relax - all is well, and than “bang”.

A few years back I helped a business that used to be successful for a number of years and made good money. Then the owner decided to hand over most of his responsibilities to somebody else, from then on it was downhill all the way. The business was doing so well that they neglected to do cash-flow planning and basic business planning, so when I arrived and did the numbers they had lost over $1 million in about three years. Believe it or not they did not understand what was happening.

What was happening was that customers were deeply unsatisfied and began leaving in droves. Nobody had paid attention to the customers for all the time since the owner had left.

The moral here is to make sure you hand the business over to people who understand that customer care is more important than a great product. As I said before “People buy from People”, remove one side without a reasonable replacement and you lost the business.

The owner came back and it took him three years to get his business back on track, now he is selling to retire. ST.

I met an old friend the other day who told me that he sold his little business, he used to work on MoD - Ministry of Defense - contracts and had developed testing programs for them.

I asked what he was doing next, go back and do it again? He answered he would need to find something else, since you could not get into the same business again. That intrigued me and I asked why?

You can not get listed anymore, the MoD only deals with companies who have done work for the MoD before and as a startup you of cause have not! I said the government is talking about letting small business get it’s fair share on government contracts. He just smiled, and said, “talk is cheap!”

He then carried on to tell me that in the U.S. small business was sponsored by government, to get contracts, and once they started your business was set for growth. Many of his friends in the U.S. had started businesses and received government contracts - defense and others - first for $500,000, second $1 million and then $5 million. The government was actively promoting small business in all areas.

What happens in the UK seems to make sure the same contractors get the work, innovation is hampered this way and no true competitiveness exists. If these alleged practices are true, than they would be highly damaging for small business.

The only thing small business seems to be good for in the UK is paying more and more taxes, in return we appear to be lied to more and more. ST.

As a European it is not always easy to understand that Thanksgiving is the biggest holiday in the U.S.. While today is the “Thanksgiving Day“, in reality the celebrations go on until Monday when everyone is back at work - it is by no means a one day affair.

Having had the pleasure of celebrating Thanksgiving with a friends family in Massachusetts in the late eighties, I have always been a little jealous when my U.S. friends and employees leave on wednesday by saying “Happy Thanksgiving”. Because I know the scenes around every small and big dinning-room table, with good food and the much needed family time - especially in todays fast living society.

Thanksgiving is now an almost four hundred year old tradition in the U.S. (1619 - Berkeley Plantation in Virginia), and the holiday was first established by President Lincoln, with specific reference to giving thanks to God. Today however it is widely regarded as a secular and quintessential American holiday.

For many small business owners this will be a time to take stock, it may be the first Thanksgiving, since you started your business. There may be worries about the future, or cause for celebrations. Whatever it is, today of all days, look around yourself and realize how fortunate you are to have family and friends to share this day with. Todays work/life balance should be 100% on the side of life, OK maybe 99% - after all you are reading this.

Happy Thanksgiving from across the pond to all my readers, my friends, my employees and all your families. Stefan

Don’t get confused about what you, the business owner of your small business or start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer- or Personal business, like professional, contractors, freelancer, self-employed, sole-trader and virtual assistants, should be doing? You need to do both of cause!

Unfortunately working in your business, like answering the phone, writing bills, doing the wages, talking to customers and so on is all that most business owners do. Research shows that most believe that this is all their is to do! That is very wrong and also the reason why many businesses fail.

Working on your business means to looking at it from the outside, remembering all these little customer comments, imagining a new type of technology to be employed in the business, changing the way you advertise, in other words making changes to the business, the whole business:-

• that will improve performance,
• enhance external communication with clients,
• improve the clients experience,
• cut costs out of your business,
• and many other aspects of your business.

That is in reality the most important part of what a business owner should do - plan the future. Working in your business, will make sure you you can pay your bills next week or even next month. Working on your business is all about still having a business next year or the years after that - that has to be the most entrepreneurial thing you can do.

Have a vision for the future - work on your small business - have a future! ST.

The UK government has lost 25 million data records of people in the UK, the whole episode is a flagrant violation of the Data Protection Act, and it is not the first time this happened. In this year alone the following “accidents” have happened:

• November 2007 - HMRC sent a disk with 15,000 Standard Life customers from Newcastle to the insurance, the disk never arrived;
• October 2007 - another computer from HRMC worker was stolen with hundreds of peoples personal data;
• November 2007 - BBC’s Watch Dog uncovered a string of mistakes made by HMRC causing personal details to be sent to the wrong people;
• April 2007 - HRMC documents found in Nottingham containing sensitive information.

And these are only the cases we know about. Mr Darling is, in good old Labour fashion, clinging to his post, despite allegations that the government lacks “basic competence”! Combine this with the Capital Gains Tapper Relief and Northern Rock debacle and you get a pretty clear picture of the competence of this government.

Watching Mr Darling defending any of these debacles beggars belief and leaves me speechless. Mr. Darling should resign, NOW. ST.

When hiring people, what are you looking for? Knowledge about your industry, high IQ, many years experience? All these personal traits are important, but not as important as EQ - emotional intelligence - which means people who have natural warmth, are optimistic and can empathize with the plight of other people.

Who would you rather deal with, someone who seems cold and distant, or someone who understands your problems and can suggest solutions or ideas on a services/product level, but also on a more emotional and beneficial level. It is with everything else in life, we like dealing with friendly and warm people.

So when you hire, ask about faults, ask about being told off for getting something wrong, ask how they felt when someone else got told off at work? Listen to their answers, if they have no faults, if they never make mistakes, or think others are just not good enough, than they are obviously perfect.

Never hire perfect people, they are deeply flawed or inhuman, and nobody will want to deal with them, including you! ST.

Many worries in a small business are centered about sales and the need to earn money in order to pay for over-heads like rent, wages and so on. Especially in a technology driven company this can often be a problem. Often you try to sell to your clients as if they are industry insiders who understand exactly what you are talking about. While in reality they are customers and don’t know what makes this widget so special.

You need to sell the benefits of the widget, that is what customers want, benefits. Know who you are talking to, if you are talking to an industry insider, tell him all the technical details, because he understands enough of the technology to understand the details, and then work out the benefits for himself/herself. If you are talking to a customer who wants to use your service or product to gain a benefit from using you, let him/her know what the benefit is.

One word about not being able to show a benefit, I would openly say to my client that there is no benefit from using our product, you may not get a sale, but you will get someone who will respect you and come back, because he/she trusts you. You may also get referrals this way.

By the way, woman are far more benefit talk driven than men. Or as my wife will say to me and my son, talking about the latest gadget, stop talking “klingon” (the star trek species)! ST.

When you talk about business, small business or even micro business, eventually the talk always turn to making money. How to make it, how to make some more and how to make sure the business keeps making money in the future. Most often than not people are surprised by my simple answer:

If you are passionate about what you business does, you will make money. If you are only after making money, you won’t.

I can proof that to you, too. My wife will always ask me why I can’t give up work, she will say you don’t have to do anything, why not stop? Answer: Passion. Why would people like Bill Gates, Richard Branson, Rubert Murdoch carry on working, after they amassed not millions, but billions? Answer: Passion.

We are not driven by making money, but by making a difference, leaving a mark. We can’t wait to tell people about our “brilliant ideas”, even if they turn out not so brilliant sometimes. I got up today at 4:00 am, because I have a great meeting set up today, with some people I wanted to meet for some time, and I can’t wait to tell them my ideas about the future of our business, so I’m going over my presentation again.

I’m sitting here at 5:15 writing my daily postings to you all, you may think I’m nuts. Or you may think I’m driven by the idea to make small and micro businesses more successful, but whatever you think, it is not “my god is this guy greedy!”

Greed is NOT the same as passion! So be passionate about your business and your customers will love you for it. ST.

WinWeb has just updated their OnlineOffice accounting module, to include cost centre functionality. This development was by popular demand, as a number of customers requested this functionality. OnlineOffice is aimed at the small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer- or Personal business, like professional, contractors, freelancer, self-employed, sole-trader and virtual assistants client.

This allows you to “tag” expenses to products, departments, services or projects - giving you the opportunity to analyze the true cost of a department or any project. This will enable you to see exactly where your money is going and you can evaluate if your projects or products make you any money.

This functionality is free of charge along with the 24/7 live support for all of WinWeb’s software products - another reason to sign up to LiveNet of OnlineOffice for the free 30 days trail, if you do not like or need the full OnlineOffice functionality, you can use the accounting module, including the cost centre functionality, free of charge forever.

This will give you financial information to make even better decisions. ST.