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What’s Your Business Worth?

Answer: Two times cash flow plus or minus some other factors.

You can skip the rest of the blog if that’s the answer you were looking for. Or another formula is, 25% or so of the monthly cash flow multiplied by 60 months. That’s a new formula I just heard of yesterday that makes so much sense it’s crazy! I’ll give you the explanation I heard from Mark Doran ( a client and old friend) who has been a business broker in Denver since 1984

Here’s the background on why I am writing this today.

When it comes to selling a business, there are a bunch of differe
factors. I have had the pleasure (cough) of buying three businesses in my life with values under
$500,000.00 And if you speak with an experienced and honest Business Broker (not that those two attributes are easy to find together in that trade) they will tell you that is about the value of businesses they are going to sell the most.

Why? Because there are an abundant supply of buyers for your business when the price is below $450,000 or so, and they can write a check for half of it and carry the rest. But, when the price starts creeping into the $600,000 or more range, the number of buyers will decrease until you make it well into the area that a corporation may be interested in buying you.

So how do you price your business? When is it to big to sell? When is the right time to sell?

I just had a meeting with a client and another client who is a business broker in Denver, . We wanted to understand how they could continue to build their business to maximize the purchase price when it’s time to sell. This is a process I encourage all my clients to go through. The truth is, some day you won’t want to continue running your business due to boredom, retirement, other opportunities, or you’ve just had enough.

So, understanding how to maximize the value of your business is fundamental in running your business. Every decision you make will have an affect on what your business may sell for if
you’re being smart.

There are certain characteristics of a “sellable” business. First it has to be priced correctly.
Second, people don’t buy jobs. Meaning if you are trying to sell a business that the buyers can go get a job and make the same money, without putting out a high risk investment in the tune of $100,000 to $300,000 cash, why would they. Seriously, don’t flatter yourself, your business isn’t that exciting. If they are going to make $95,000 a year owning your businesses, and they currently make $100,000, or have that ability, good luck. Not going to happen often.

Now, if your business can provide the same buyer with a $225,000 a year cash flow, and it’s a better lifestyle than working for a boss, now you have something to sell.

Another principle is you, as the current owner can not be irreplaceable to the day to day function.
(This is of course is in the view of the buyer). You need to be closer to a CEO role than a mid level management role. This can be really hard. But it’s true. If you are making most of your dollars based on you selling, or you being the production person, you may have trouble. If your primary function is leadership, oversight, and senior level, you’re in much better shape. Few will pay $400,000. for a business that they have to answer the phones, and clean the toilets.

There certainly are more characteristics, but lets move on a bit.

So whats the value of your business?

Start with this. Take your cash flow (that’s basically every dollar that you get, one way or another, through owning the business. So your salary, your distributions, your profit, and other little expense items that in fact could be considered income. If that number is $150,000 to $250,000 or so, you may be in the sweet spot. If it’s above that, and lets say $400,000 or above
you may be pricing yourself out of the market. Not that you can’t sell it, there are just fewer buyers for those earning numbers.

Here’s another way to view what your business is worth. This isn’t your accountants formula, this is the best real life view of a small business’s value I have ever heard, and it came from Mark Doran owner of Choice Business Opportunities yesterday.

This is the premise. Most sales of a small business will have terms of 50% cash (ish) and 50% carry for 3 to 5 years for the seller. So the new owner will be paying the seller a monthly sum equal to the carry amount divided by the number of months.

So here’s an example. You sell for $400,000 because you have a $200,000 annual cash flow) you take $200,000 down and carry the rest for 4 years, which is 48 months. So the new owner will be paying you $4167.00 a month to pay off the note. Their monthly cash flow starts at $16667. a month. So there is a very comfortable “cushion” between those two numbers.

With this formula (which will come out to the same amount as the 2 times cash flow) your business is worth about 25% of monthly cash flow times 48 ( may be up to 60 depending on stuff) times 2.

So if your monthly cash flow is $15,000. 25% is $3750.00. Use that and multiple time 48 and you have $180,000 and multiple times 2 and you have your estimated value of $360,000 for a business that cash flows out to $180,000. a year. Hmmm looks like 2 times cash flow.

If your monthly cash flow is $6,000, 25% is $1500 multiplied times 48 is $72,000, multiplied times 2 is $144000.00 value. Two times cash flow
The reason this formula is important is, if you are going to carry 50% (or whatever amount) of the purchase price, you want the buyer to have enough monthly cash flow to be able to pay you, and get through what ever tough periods they run into. And new business owners often will see some revenue bumps as they get behind the wheel. The last thing you want is to take back a crumbling business, or have a buyer who can not pay back what you carried.

So why carry any of it? Because you almost have to. Few buyers won’t want the seller to have skin in the game, and banks rarely will loan money on a small business sale. So let this point sink in, you will in all likelihood be carrying a loan for the buyer.

And finally, why is this important in your day to day life? Some of it is simple, this is why you do all that heavy lifting building a business. This is the pay off some day. If you plan for it, and make decisions based on a certain targeted cash flow, total revenue, and business structure you are far more likely to get there, and not overshot the goal, or have a harsh reality hit when for some unknown reason you decide to sell. Another good idea is that when you are a few years out from selling, all new revenue to your bottom line is worth double when you sell! If you can add $40,000 in cash flow, you’ll see an additional $80,000. in the selling price. <<<<<<<<<<<<<<

So investments in marketing programs that work, make even more sense as you begin the thought process of selling. SEO, advertising, sales help, all can be a huge return during that period.

Although the meeting I spoke of yesterday was only an hour and some minutes, I could write a book on what we heard and learned about selling a business. Needless to say, everything in this post is my non professional opinion, and just what I thought I heard. Some is from the practical experience of buying 3 small businesses in my life as well, but if you are looking to sell, get to a well qualified experienced business broker. If you are on Denver or Colorado, I’d clearly recommend my client.

Marketing and sales is a part of every decision you make as a business owner in one way or another. That’s what makes our service unique. How many marketing, or SEO’s have asked you about your exit plan, and helped you understand what it takes to sell your business when it’s time?

By: Mike Bayes.


Why SEO Programs Fail So Often.

Why SEO Programs Fail So Often.

It’s math.  Really, think about the numbers for a minute.

Lets say you are an accountant that offers bookkeeping and tax preparation.  You want to get into one of the top 3 ranking spots on Google for “bookkeeping (in your city)”.

1 + 1 = 2

Why one of the top 3 spots ? Because those are the positions that will actually deliver traffic. The rest will at best bring in a dribble of visitors.

Okay, so how many businesses in your city offer bookkeeping (or whatever you do). ? Maybe 500 have web sites that google has indexed. So your odds start at 1 in 167 that you will be in one of the top spots. Based on that it’s not a bet you want to take.  And these numbers don’t even start weighing in the advantages many websites have over yours before you even get to the starting line, such as, the fact they have had a site indexed and well-respected by Google for maybe 10 years.  Huge advantage to the competitor here.

Now, how many of those other businesses have used an SEO or worked on their site to improve its ranking or traffic? I don’t have the answer to that, so lets just assume that all the other 499 business owners receive just as many emails and phone calls about Google rankings as you do every month, and that they, like you, eventually will give in to the constant buzz and give it a go.

The point being, a bunch of your competitors have already made the original journey down the SEO path, and in maybe 200 of 203 cases are NOT in the top three.  Also add in the reasonable assumption that the businesses currently on the first page, and especially in the top positions, have a good SEO firm they have been working with for years.

One of those 200 is most likely the one I will here from to get help. Why?  Because I rarely work with a business who hasn’t tried SEO, and realized all the unfulfilled promises. They’ve spent  $350 to $500 or more for a year with the constant hope that traffic and sales will start coming, and yet, very little has. Why?  Because of the numbers I just mentioned (the odds), the inherent disadvantages their site had to start and needed to overcome, and possible a SEO firm that was overly optimistic based on 1 or 2 success stories they are part of in an unrelated Industry to yours a few years ago.

Hey…  if you track rankings like we do, you will notice something incredible important.  Rankings don’t change much, or quickly for the top ranked sites under competitive keywords (and this seems to hold even more true for “local” sites).

So, now you have a sense for why most SEO programs fail to delivery the anticipated results. My intent here believe it or not, isn’t


to dissuade you from engaging in a SEO program, it is to simply educate you on the odds of success.  There truly are real opportunities to leverage your web site as a lead generating and prospect conversion tool using SEO and other marketing programs, you just need to understand the odds, and be prepared to face those odds with an experience partner, who has proven results as well as utilizing other forms of traffic generation for your site, of which there are many, and some that you may find a far better investment in the beginning as you build a long-term SEO program.


Mike Bayes




Cash Flow Engineering. Optimizing Your Profits. (Construction)

The following is the written plan for a work shop given on Cash Flow Engineering.

“An engineer is a professional practitioner of engineering, concerned with applying scientific knowledge, mathematics, and ingenuity to develop solutions for technical, societal and commercial problems. Engineers design materials, structures, and systems while considering the limitations imposed by practicality, regulation, safety, and cost.[1][2]The word engineer is derived from the Latin roots ingeniare (“to contrive, devise”) and ingenium (“cleverness”).


“Engineering (from Latin ingenium) is the application of scientific, economic, social, and practical knowledge in order to invent, design, build, maintain, and improve structures, machines, devices, systems, materials and processes.”


Cash Flow Engineering is the process of applying known mathematics and industry Knowledge to apply solutions that provide consistent, and predictable Cash flow in a scientific and proven methodology that combines both financial reporting and operational implementation. It’s result is to increase profit and reduce risk for construction companies.


Cash Flow Engineering has two very important parts:


1.) The knowledge and information of key areas of your finances that impact profits

2.) The implementation of real automated AND human processes that map the operations for profit.

What’s missed in 90% of the businesses we work with is this integration – Automation with process. We all take blueprints seriously in the actual physical building of a home or  large construction project, yet we consistently work with sloppy financial tools which  drive the physical process.

The fact is nothing good happens in business (or life) without it being a Intelligent thought first. Nothing in this room arrived without the fuel of Intelligence, and the implementation of that thought process.  The table you’re sitting at …  was engineered with the right information and started with intelligence.  The lighting, the ceiling and the roof… even the door you walked through, all started as an idea, and was engineered with good information, the right tools and experience… for profit.

So why don’t we “engineer” our profit? Profit like anything physical is just the manifestation of good thought process and knowledge into a “real” thing by using the best tools available.


Anyone feel profit isn’t real?  Just like everything you are surrounded by in this room, profit is just as real and can be engineered. We call it Cash Flow engineering.  

Components of Cash Flow Engineering

- Intelligence.  You need expertise

- Thought Process..  you need experience

- Tools… you need automation and process

- Implementation… you need systems

- Reporting…  you need accurate numbers

What we deliver to clients is the automated system, and much of the broader Intelligence needed to insure profits, mitigate risk, and sleep much better at night, through a predictable and consistent Cash FLow system we call Cash Flow engineering.

Detailed thought process……How many of you know…  

where to get a building permit?

What the average wage is for a framer

What the average square foot cost is for the projects you build?


Broader Inteligence:

How many of you know:

The industry average cost of marketing?  Are you spending more or less than the competition?

What the industry and local average Net profit is for a company like yours.


What is your critical mass quarterly to survive?

WHat percent of your gross your overhead needs to be to make the right amount of profit?


What’s your monthly break even amount?


What is your net profit on projects that cash flow after your break even amount


How to calculate a 18% margin on job that costs 100K?


What margins you need on all jobs to make a reasonable profit.


What  is your cash flow on every job, every week


This is the larger Intelligence that is nearly impossible to have unless you have worked with 100’s of home builders and contractors, and managed billions of dollars in Cash Flow over the years.


The most misunderstood value a company brings to the market… is Intelligence, experience and the tools to build with.


Any of you ever witnessed an idiot as a competitor?  Notice how quickly they disappear?


In Cash FLow engineering… you view every dollar spent as an investment.  And if you can pay out a dollar… that returns $1.25 that year, you’d be throwing every dollar you could find at it.


In fact… your labor is an investment and must return a percentage.

Your marketing is an investment that must produce a return on the dollars spent.  

Your Financial management should be the same.  You should EXPECT a profit on that cost.


That’s what cash flow engineering provides… a profit on the financial management of your company. Our average client, using cash flow engineering see’s a 2-3% increase in (NET?)  profits.

That can be a 10% to 30% increase !  


So for the next 70 minutes or so I’d ask you to change your thought process from this old fashion view of profit


(Pyramid with profit on top)


To this


Pyramid with Profit as foundation


Profit isn’t a result, its a plan

What you will learn today:

Importance of Cash Flow

What Is Cash Flow Engineering

How to implement it in the 4 areas of operations


But first lets talk briefly about Cash Flow in general…

Point One:  Every large Successful company has a CFO who has  one main responsibility,  to insure consistent and Predictable cash flow.  Some of you may as well, but in many cases its just not economically feasible to pay a CFO 200K  a year.  Cash flow engineering gives you this function, at tiny percentage of the cost of a CFO.  And…  it doesn’t need a staff, or an office , or an expense account!


So, if you all would allow me to, I’d like to apply to be your CFO or CFO assistant for the next 70 minutes, and tell you how I (or your current CFO)  can and will deliver Predictable and Consistent Cash Flow and turn your accounting and bookkeeping into a partner that makes you more money.


everybody okay with that?  Thank you!


As your CFO…Let’s talk about…


a Commonality of successful Construction Firms.


In our experience, THey all have  trusted advisors in key disciplines. The owners or senior managers play this role on operations, and sometimes sales and marketing. But you see a void many times in the finance area.  Remember… 33% of your net profit is a result of each area. And that experience is a key component of success in any area.


Ask The group – What are the key disciplines of your business?


( write on board)      Operations, Sales/marketing/ Financial Management  (any others)


Now you can define if each area is doing a good job by asking these questions:



Are jobs completed on time.

Are customers Happy  

any other questions the group can think of ?  Write them down


Sales and MArketing:

You have a steady flow of projects and leads

You close an acceptable rate

The leads you get are for the right type of customer

Any others?



You always know how much money you have in the bank

Youre always collecting money BEFORE work is performed

You never worry about making a payroll

You know how much is going out and how much is coming in very week, without guessing

You make profit on every job, and you don’t have surprises come up that bring down your profit

Any others?

Now please take a look at your first page of our handout  and take a few minutes to answer the questions on the what’s working and what’s not page.


(give them 2 or 3 minutes to do this)

Then… okay, now quickly

Rate yourself and your company in each area 1-10


Sales/Marketing  1-10

Operations   1-10

Finance   1-10

Done?  Good…


I want to give you a formula you’ll be using in a second to figure out how much money you can add to your bottom line by using cash flow engineering as your CFO or to assist your CFO.


In construction your net profits will basically reflect your

expertise in the three disciplines…  


So lets take a look at your answers… and figure each discipline will be contributing 33% of your profits., if your answer in that area is at least an 8.


On the next page you can see a worksheet that you fill out.


Assume 100K in profits  or add your own numbers from last year, or projected for this year.


I’ll use 100K  because its easy…


Profit: 100,000


The reality is any score below a 5 is probably costing you ALL of that area’s contribution to profit. Any score between 5-7  is probably costing you 50% of that area’s contribution.

How many had anything below an 8 in operations?

In Sales and MArketing?

In finance?


On your worksheet…  take your gross profit and now subtract either 16%  or 33%  of the dollars as lost profit due to underperformance in that area.


at 100K  thats 16,000  or $33,000. And I hope most of you are doing much more than that!  


Another way to look at this lost opportunity is to figure out how much additional gross revenue you will need to make those same dollars.  So, If your lost opportunity in Finance is $35000,  You will need to sale build and complete an extra $350,000. in  projects to make up for that.

And by the way, if you’re doing 1,200,000  a year…. your net had better be 100K, or something is very very wrong.

The entire point of this is for all of us to recognize that each area of your business has a profit opportunity, IF it’s run well.  And in construction companies,  Finance is generally the area that the managers have the least amount of experience or knowledge in, and especially when it comes to how to make money using Finance.


Thats why I’ve spent the last 7 years figuring out the CASH FLow Engineering system for you…


Cash Flow Engineering is this:


1.) The knowledge and information of key areas of your finances that impact profit…


2.) The implementation of real automated AND human processes that map the operations for profit.

It works to engineer the 4 major components of operations that makes up your profits


1 Bids or estimates….

2 Job Cost Tracking

3 Progress tracking and reporting

4. Change orders or exceptions


Cash Flow Engineering  is a process that combines operational systems with financial reporting and awareness, which insures a profit on every Job.


Now, as your CFO  I’d like to show you how each component should be engineered to assure profit

Lets look at


Estimating and Pricing:


The most common mistakes I’ve seen in Estimating are:


Each mistake causes a builder to start losing money… from the VERY beginning!


So.. we engineer your estimating process to automatically safeguard your project against these problems!  Doing this with automated tools is the best system. It removes a bunch of mistakes, and saves a ton of time.  


Pricing slides here  Jeff insert your slides here on pricing and estimating.  Remeber.. its about the process…  


10 minutes


Lets look at the Principles of Cash Flow Engineered Pricing for estimates and why they will make you money.


(  Explain and then show screen shots of our CashFLO software to use as an example


At the end ask… Can you see how just this can make a business more money?  Right!  And thats what Cashflow engineering does for the estimating process…


It is the result of good information…  good tools and experience


( Margin exercise here?)  Jeff insert one slide on Margins. ONE!


I can’t move on today without giving you one exercise that might change your business for the better forever if you fail.  So don’t worry about a grade here.


Write down three costs:





Write down how you would calculate a margin of 30% on each one, and what that number + 30% margin is.



Ask for answers.


some will be right… some will be wrong.  


Explain BRIEFLY how a margin is calculated….  and have the margin slide up.


Ask… can you see how important this is in your pricing and estimating.


Pricing and estimating is the foundation of profit, and doing it with the right tools, the correct information and intelligently is what cash flow engineering is about. I built a software that does this for you, or you can do it yourself. In our business, we do all the backend work, so your job is to just use the tool.

Lets look at the second component:  Job Cost tracking!


As your CFO… I see Job cost tracking as taking your final estimate, and tracking your performance against that profit goal.  It’s not something you should review at the end of a job as a report card… with cash flow engineering you see the profit of every job every week, and you will know if you are on track, or need to make changes. And you will know in 5 minutes per job or less.


Question: How many of know exactly where each project you build stands from a cash flow basis every week.  Are you making money, or losing money… right then?  


Get answers….


In cash flow engineering you should never be cash negative …  never.


Here’s a little example of the intelligence we use in cash flow engineering


(Screen shot of dash board)


Go through ONE job dashboard.  Just the dash board.  Use one that is not doing well.


HOw do we do this?



a tool

and an operational relationship… you seeing it and acting on it as a process.


Lets talk briefly about  the principles we use in Job costing…


Jeff use your slide(s) here. No more than two.  no more than 5 minutes.


So can you see how a well engineered job costing system can make you money?  Knowing what’s happening at any step in a project?


Question….Tell me how you could use this information?


BUT  as we all know they are challenges that come up during any job…  unless anyone here never has a change order or a scheduling problem on any projects?  Anyone?


Lets look at how Cash Flow engineering automates and integrates a process to handle these opportunities using intelligent thought process, automation  and the a system.


But first…  would someone share how they handle change orders, or exceptions now?  In other words—  how do you know a cost that was on the estimated went over the plan?  Say your electrical cost was based on 10K, but the bill is 13K.  How and when would you know, and what would you do?


Get answers… and brief discussion


Great…  As your CFO, let me walk you through a Cash Flow engineered system, that is automated and allows us , if you implement it, to never lose a penny of profit using job cost tracking.


Jeff insert Two Slides here on Job Costing, and a screenshot of

our Job Costing in Cash Flow.

Walk them through it  3- 5 minutes


( Job Tracking will go along the same lines….  starting with a question to the group  and then into the cash flow engineering slides of your choice as related to scheduling)



A summary of the importance of Intelligence, thought process and system are to profit


A example of a client using cash flow….  success!


THanks for allowing me to be your CFO this morning.  I hope it’s been valuable… and I want to let you know how we can actually work together if you like.


We have three ways-

The full day CFO financial check up. I’ll will spend a day doing…..

with you…  at the end of that day you’ll have an actionable plan to make more money. I only have one spot a week, so you need to speak to us today to schedule it.


We also have a quick one hour review…  a get to know you better session where we ( details)


And, if you’re ready, we can discuss a performance based  accounting/bookkeeping  and cash flow engineering service. And yes, we can do everything for you including the Intelligence, tools, and implementation. BUT  only if you are ready to commit to higher profits.  Talk to us today to schedule a meeting.

Using Google+ Communities for Business

Have you ever considered building an online community for your business?   There are many ways to do this- from building and hosting your own using open source software to using an online community builder or building one with tools on the existing social networks – Facebook and Linkedin, for example, both have offerings in this area.

One of the newest, and potentially most significant players in this market is Google.   First launched in December of 2012 Google Communities provided an easy set-up, but a minimal feature set.   It had the advantage, however, of a large audience of potentially interested members, having been built as an integral part of Google+.   I have built several communities on Google+ – including one with over 20,000 members, so I know some of the ins and outs of this technology and would like to help save you some time and do what I can to help your community be a success should you decide to build one.

English: Google+ wordmark
English: Google+ wordmark (Photo credit: Wikipedia)


First, it is important to understand the difference between what Google calls “communities” – but goes by many names in the industry (“Groups” on Facebook other services, “online forums” with some other technologies) and a “page”.  A page is a way of promoting your business that is offered by Google, Facebook and Linkedin.   A page is like a simple website with an administrator can post information and users can comment.  Users cannot, however, initiate a post.  With a community users can both comment, as they can on a page, but they can also initiate posts.    Communities can also be either public or private while most pages are public since they are used for promotional purposes.

This can make the moderation of these communities a little more complex than just the standard customer relations function of addressing and managing comments as you would have on a page.  Let’s take a hard look at Google Communities – both its strengths and weaknesses to see if it could be to the advantage of your business.   I’ll also try to give you a few tips on building your one community on Google+ should you decide to go that route.   First its strengths:

Advantages to Google Communities

1.  It is a snap to set up.   It is so easy to setup a Google community it will probably take me longer to write this post.   The is a bit of an exaggeration, but you can get the basic setup finished in five minutes or so, and improve it from there.  The setup is just not a big deal.

2.  It is good for relationship building.   Since users can initiate posts, there is less of a “pearls before swine” quality to the engagement.   While you will want some moderation guidelines, basically your members can say whatever they want whenever they want.  This will have the effect of having the relationship be more “authentic” – you are basically putting yourself out there.

3.  It can enhance your stature in a subject area.   Since you will be managing a community where people can freely express themselves, you will have to be fair and allow a different views to be expressed – in some cases possibly from competitors.  .  Depending on the subject area, this may help you to be seen as an expert in this area.

4.  You will learn from it.   Since a well managed community will have a variety of views being expressed you may learn some new things and get new ideas.   With a “page” setup you might just be hearing what you want to hear.  Sometimes when a discussion gets lively on a community some great ideas can be generated, and new ways of looking at things can be revealed.

5.  There may be some SEO Benefit.    Google indexes posts in its search engine your business might get a bit more exposure through it.  In addition, with Google Communities you are allowed to display up to 10 links on the Community home page and these can be links to your business or other resources for your members.

7.  Hangouts and Hangouts on Air.   While the technology for communities themselves may be more or less traditional – and even have less functionality than most systems, there is an important exception.   Hangouts – Google’s name for video conferencing, is integrated with communities and is an amazing technology.   These hangouts let you meet in a live videoconference with up to 10 people which can take your community to a whole new level.  There is also a “Hangouts on Air” – currently not as well integrated but still possible, that lets you “broadcast” these hangouts and record the to Youtube.   This alone may be reason for you to select Google communities if you have a subject area and population of potential members you feel could benefit from this kind of video presentation.

Disadvantages to Google Communities

1.  It is hard to get new members.  Don’t expect an immediate flood of member requests once you setup your community.  Since they are so easy to set up there are tens of thousands of them – maybe more.   You may have to build your community one member at a time at first.   It is also possible that your best potential members aren’t active on Google+ at all, and even if you persuade them to join they won’t participate much.

2.  Moderation can be a challenge.   It would be nice if these things “ran themselves” but they don’t.   Posts that are low quality or off topic are frequent, and you may have to use your best diplomacy skills – or your hammer –  to address these.   It is not uncommon for “drama situations” to break out and it is even possible for whole communities to “melt down”.   As community owner, you will be responsible for this.

3.  It’s Time Consuming.   Managing your community – including approving new members, participating in discussions,  moderating disagreements, encouraging quality and posting your own content can be a major time sink.   This must be weighed against the advantages of having a community.

4.  Communities compete with each other.  Google set up communities so that anyone could start one on any topic – and they can even have identical names as other communities.  This means that there are many overlapping and competing topics all competing for the same audience.   The is particularly true of the larger communities with broader topic areas – it is probably best to not compete with those communities unless you are willing to invest substantial effort.

5.  Spam is a major issue.  Google communities are absolutely plagued with spam.   They have a spam filter that is pretty good at weeding most of it out, but you will still see it.  There is also a problem with “near spam” –  posts that are just bad for whatever reason.  While this is mostly an issue on the public communities, it is not unheard of on the private communities either.

So should you do it?

The answer is, of course, “it depends”.   Don’t do it “just because you can” however, anyone can set these up and an empty community won’t do you any good nor will one you work on extensively that never gets “traction”.    Think first about precisely what you want to accomplish with your community and then carefully weigh the advantages and disadvantages listed above.   At this point in the development of communities it is unlikely that a broad topic will work unless you are already a recognized authority in that area and have a ready population of followers.  That is not to say private communities won’t work, however, or even public communities in niche topic areas.

Going for it?  Here are a few tips.

So if you have weighed the advantages and disadvantages carefully, and you think it can help your business or practice area, here are a few tips to help you get started:

1.  Set up the community completely before you invite anyone.  As we discussed here, the initial community setup can be done in just a few minutes, but doing it right can take considerably longer.   Get everything ready.  Have some good web copy for your descriptions, set up your posting categories and write some moderation guidelines. – you will need them later.

2.  Have content ready.   Consider “seeding” your community before you even invite anyone with a few interesting posts that set the “tone” of the kind of posts you want in your community.   The last thing you want is for new members to to join an empty community.   It might even be a good idea to have several posts pre-written for future postings.

3.  Identify Prospective Members.   If you are already active on Google+ identify everyone in your circles who you think might be interested in your community.  Make a special circle for these prospects.   If you aren’t active on Google+ it may be a tougher slog, but do some searches on your topic area and build a circle based on this interest.

4.  Invite your best prospects.   Try to get a commitment from as many of the people you know who might be interested.  Write them and tell them what you want to accomplish and enlist their support.   After you have done this, send an invitation to these prospects.

5.  Start engaging.  Try to get a conversation going with these initial members.   Use your best content if necessary.   Do whatever you can to “make it interesting”.

6.  Invite a “second wave” of prospects.   Now take the rest of that circle you have built and invite those potential members.   Write a good introduction about why you think will be a good community.  Continue promoting your community however you can as an ongoing effort.

7.  Select a Moderator.   Ask one of your members to help with moderating the community.  This will not only reduce your workload a bit, but will have the added benefit of making your community look a bit more “established”.

That’s about the best advice I can give you.   The rest is up to you.  Wishing you the best!

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The Forgotten Element of Time:

The Forgotten Element of Time:

My understanding of time is that it is a necessary illusion.

It’s best explained like this.  Visualize time as a ribbon,  like a road, that stretches across the mental universe. its length represents the progress we make in understanding things.

We are either making progress(moving forward) or not moving at all. It’s not possible to move backward once real knowledge is learned or discovered. So we can either move or don’t move. It is possible to make large leaps in moving forward however, and those leaps advance your knowledge to a new place on the ribbon.

Ribbon of Light

So what happens at the end of the ribbon?  Well,  it has no real end, but I see it as rolling up into a tight completed integrated universe that we are now free to experience all of it at once.

Hows that relate to your life, or your business?

For me, we forget to look at our daily activities and efforts as either progress or no progress on the Ribbon.  Is what we are doing in time, in whatever manner, making us smarter, better or of more value to others?

Same thought for a client. Is what you are doing making them Better, Smarter, or of more value?  If so, you are progressing, if not you’re standing still on that ribbon.

Work on moving your clients on that ribbon, and you may find all new ways to be of value, and new services to provide. A whole new world can open to your business if you view your business priority, as making progress daily, and helping others do the same.

Progressive thoughts:  How can I make my clients life easier?

Non Progressive:  How can I make more money on what I sell.

Progressive thought.  I will help at least 2 business people a day that do not pay me to do so.

Non progressive:  I will call 30 businesses and ask for an appointment so I can make more money.

There isn’t a good or a bad in any of this, there is only a progression in the right direction, or no movement. Same place, same time.  No progress.

I can not prove any of this, I only knew that when I think and act in these terms, the business does well.  When I don’t , I may have temporary success, but it always disappoints in the long run, often times manifesting itself as the constant need for more stuff, or more money, or more time….

English: Sibsey Parish Clock Nick The local fa...

If I make progress each day  (add a little or alot to my knowledge of how things work), and do the same for others (with can not be helped if you are advancing) then its a good day.




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SEO and the M Theory

Okay.. so years ago there was this huge debate in the physics world about the M theory. Some said it involved 10 dimensions, some said 11. Some said there were an unlimited amount of universes, some said there were 122… whatever.  The point being, the quantum theory community had a bunch of different “opinions” on how the universe (in a quantum way) worked, and worked at the quark level.

This all evolved into the string theory….and all things being made up of vibrating energy. The rate at which the thing vibrated made it appear as either matter, light , or gravity. Easy right?

So strings are little pieces of energy that vibrate.

You see where this is going right?  In the end (so to speak, as there is no end to anything in the string theory) one amazing scientist came before all the others and basically settled the debate by proving that they were all saying the same thing, they were just looking at it differently.

Local SEO and Digital Marketing is all the same stuff looked at differently. Here is what makes up a partial list of areas that SEO’s and inbound marketers (heck we can’t ever decide what to call it!) think make up the SEO universe.

On Site:


Words strung together

And a bunch of other details…

Okay.. that’s it for on site.  Now for off site:

Social sites



Paid advertising



words strung together.

and a bunch of other areas…

Heres what I think SEO is:

Words strung together throughout the Internet that vibrate differently.

Now, Apply Newtons law of motion… an object in motion has a tendency to stay in motion  ( picking up more mentions, links and words strung together)  and you have SEO.


Thank you


Business Is Relationships. Build Your Referrals.

Business is relationships…

Yet we don’t really focus on the current health and value of our relationships with business contacts. As small businesses we track and analyze piles of information, and ignore our greatest assets, relationships.

Here’s a system (or part of a system) we have used for several years that can drive your sales, and build your relationships.  I think its self explanatory.  Just list every business contact you can think of… even people you haven’t communicated with for years, in each category.  The spreadsheet gives you a blended score which in theory predicts which of your contacts has the most “referral” potential.

Relationship Charting Expanded

Then do something for each one.  Even if you can’t think of anything to offer, you can call or email them, and say, I was just thinking about you and wanted to see what you are doing these days.  You can offer to do an introduction to someone, or invite then to lunch. Have a great tip on sales or marketing, or something that is working for you that you can share?  Any thing that is of value.

Relationships, like anything else, need maintenance and nurturing. This simple spreadsheet can go a long way in helping you grow your most important marketing and sales resource… the relationships you have built.I would love it if you would try this for a week or two to see what results come from it.  I can tell you, it’s been my number one source of leads and sales for two years.

If you are an Internet Marketer you can use it to build great on-line contacts. In many ways, its much faster because you can use Social Media as the nice thing to do for someone. Post their blog on your G+, Facebook, Linked in… that’s a gift.  Even good blog comments are gifts.

Click here to view the Google Docs Sheet Relationship Chart

Let me know how this works! This is a part of our Sales Coaching Program.  Need help building your sales and revenue?  Contact me for a free consultation.

By Mike Bayes

303 500 3053 ext 1

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Increase Business Sales through Giving More Referrals

How To Increase Your Business Sales By Giving more Referrals.

What you are about to read will significantly increase your company’s sales. I am writing it because referrals represent the largest bucket of new sales acquisition for many small and medium businesses, and are the most difficult thing to increase in volume. We all love them, and can’t seem to generate enough of them.  First a short background on why we think referral programs are both important and generally are complete implemented in the wrong way.

English: Kansas Lottery Yearly Sales Graph.


One of our services to clients besides Internet Marketing and Search Engine Optimization is a

Sales Crystal Ball program. It falls in the category of sales acceleration. In its basic form, the final product will tell a business where its next 12 months of customers will come from, and how to sell them in half the time.

English: A Crystal Ball I created in 3D. Suppo...

To accomplish this we look at a large data set of former customers. With in that data we find the largest commonality matches. Those of course turn into a target market. A message based on the findings ofwhy former customers purchased, is developed and then delivered to the new target market.

As an example, we recently finished a Crystal Ball program for a client that clearly identified that 90% of what they had described as their best customers were all part of one organization. The vast majority of their best customers

had 6 or more employees and the vast majority of those had been in business 10 years or more. The new target market was very defined and easy to identify.

Here is where finding new clients becomes a challenge, as most of the clients customers in the above crystal ball assessment came from referrals, and this is the case with most of the businesses we work with. When assessing where new clients find them, the number one (by far) way is almost always through a referral.  This is really a good sign as it demonstrates the company does great work. The problem is if you want to build new sales at an accelerated rate you can not just wait for someone to refer you, and most referral systems you can build have a limited success rate, although certainly worth the effort to develop.


Here is why a referral program doesn’t build sales quickly. Its premise is an anti altruistic tit for tat system.In other words you ask for something before you give.

A tit for tat system is simple. I give you something that is valuable, and you feel the need to return the kindness.

In a referral system, you are saying, give me something and I will be thankful, or I will give you a reward. In human nature, that’s a turn off (There are a few exceptions to this rule of course).

To have a truly successful referral program, you must reverse the tit for tat process. You must start the system by giving the customer a gift or help of some sort that has real and unique value.  Value has a tendency to be returned in equal or higher quantities.  This value you give needs to be a surprise, not baked into a system.

A personal example of the power of a tit for tat system is when your neighbors drop off some home baked cookies before the holidays. They just show up and hand you a gift with a smile. Soon you may find yourself baking a batch for them, or returning the kindness in some other way, but chances are it will be cookies or food. This point is very important.  Tit for tat values are generally the same stuff given back and forth.

A business example: B2B

If you want other business to promote your service, you must first, promote their business. If you really want a business to refer you, you need to refer them first!

So it all comes down to this when we discuss referral programs.  Instead of building a “we will give you something for a referral”, you need to build an internal process and culture that says, we will give our customers referrals. Then you need to actively find those opportunities. If your sales person(s) can find an honest way to refer one prospect to your better clients a week, you will be pleasantly surprised at the effect it will have on your sales. Even better is to find a way to constantly promote your best clients, so there is an ongoing process of giving.

How to start:

  • Make a list of all of your better clients.
  • Next to the company note the services or products they sell.
  • Next to that, add a note of  the clients or associates who might need or purchase their services in the future.
  • Now make a list of introductions you can make.

You see where this goes. You can send an email to both parties as an e introduction.  You can call them and introduce the other party. You can set up a lunch for them to meet each other.  You can hold a quarterly networking meeting for all the clients.

Another system is to develop an ongoing promotional program on your site, or in your newsletter, that allows you to promote your best clients.  Call them and ask if they would like to be listed or promoted through those opportunities.  If you are really into this, you can even add some ad words PPC to drive some traffic to the resource page on your site, using the clients keywords.

There are as many ways to provide referrals to your clients as there are ways to promote a business. Be creative and give first, and do not make this process public or part of a sales presentation.


303 500 3054 ext 1

My One Call LLC


SEOmoz talks about this in a how to get links article here


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SEO Trusted Links

On August 10th 2012 Google made what I would consider a major change to it’s system of ranking sites. You can read about it her :

The change gave higher value to links to your site from web sites Google considers “trusted”. Our clients and our site saw rankings improve after this change.

So I wanted to start giving you a trusted site of the week, that you can add if it applies to your niche. I don’t want to put these in our normal newsletter, so I will post them here, and the reason why we see them as trusted.
Let me know if you see the same results by adding your site to the “trusted” sites according to what we can discern Google thinks.


Here is the first blog on this

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Google Plus for business (Places) Reviews Are Crap

Why Google reviews are crap.

Yes, I know, I am the one who for years has been promoting the importance of getting your customers (or your clients customers) to write reviews on your Google places page, now Google plus for business, and soon to be ???.  From a SEO stand point it has always been helpful, and more importantly from a on-line reputation concern.  But I recently returned from a long weekend with my wife and younger children to the Manitou Springs area of Colorado, and this has changed my view on how valuable Google reviews are.

Google 貼牌冰箱(Google Refrigerator)
Google 貼牌冰箱 ( Google reviews are crap)

You see, during the trip we took advantage of the touristy sites in the area, and they are many! Some lived up to their reputations while others didn’t. As a long time follower of Google reviews and other on-line reviews I found it odd that several of the attractions we visited seemed completely out of wack with the Google reviews we had read. And yes, I actually plan out the visit by looking into the things we want to do by checking reviews.

Today, as I did my duty as a Web Citizen, and went and wrote reviews on several review sites for the touristy places, the restaurants and the hotel we stayed at, I noticed an interesting trend. Now keep in mind, we didn’t go any where off the beaten track, these were your normal family go to places, and as a highly visited area of our great country, most of these places had a ton of reviews.

Image representing TripAdvisor as depicted in ...
Image via CrunchBase

The trend is, some of the places that had good Google reviews had very mid to low over all reviews, and at least in our experience the Tripadvisor reviews seemed far more aligned with the actual experience, and the Google reviews seemed, well…  like they had reviewed the wrong place! And in several cases the tripadvisor reviews were good, and the Google reviews were bad…

Now if that was the inverse it might just be the old “people who have bad experiences have a tendency to write more reviews than those that write good reviews”.  But this was the opposite. So do people who write reviews on Google just have a propensity to be happier and nicer people who would never leave a negative comment?

City Hall in Manitou Springs, Colorado. In the...<<< ( That’s The Manitou Springs Chamber office)

My theory is far simpler, as I have a simple mind, (some might say a simpleton).

I think Google is just infested with fake reviews. Why? Because  it had become so important to small businesses that many made the decision to write their own reviews or entice others (and at times pay others) to write them for the business, a form of Internet prostitution if you will. I would even guess that Google knows this, and has taken extraordinarily stupid steps with their new review system to steam the tide, making it difficult to even get a real review published, and making it harder to understand the overall ratings by using a format that makes no darn sense to the average American when they acquired a restaurant review service, and applied it to every type local company. Insane? Details here

I was going to show you screen shots of it, but I want to stay on point, and that point is Google reviews are crap.

Now, should small businesses stop asking for Google Plus for Business reviews because Google reviews are Crap?  NO. You can’t. What has been created is a bit of a monster for businesses whose prospects search their services out on the Internet.  I do think we all need to complain and whine and do what ever we can to encourage Google to find a better way. I did a blog recently making the simply suggestion that Google verify reviewers the same way they verify business listings on Google places, through a postcard or phone call. I think that would go a long way in cleaning things up.

And frankly they may be doing the American public a great service if they just delete every review currently on Google places, send them to the respective business if they would like to post them on their site, and be ride of the problem for ever.

Can you tell I am upset over spending $75.00 at a tourist trap that (in my opinion) clearly either had false reviews, or completely insane customers who write delusional reviews after they get back to the hospital?

Now add into that the oddity that our hotel had pretty poor Google reviews, but pretty good tripadvisor and yelp reviews.  What’s that about? (I feel lucky not only because I married the most perfect woman on earth), but also because I read the tripadvisor reviews first.

I can only surmise that the Google reviews once again were written by the same bus load that stopped at the aforementioned tourist trap, or a competitor had these reviews posted, a nefarious tactic far more common than the public knows about, but will surely be uncovered more and more as time goes on.

So in closing, (thank god) as a consumer, check several sources for reviews. As a business encourage your customers to use several different on line review site. Tripadvisor, Yelp, Yahoo, Bing, City Search, Angies list and many more.  Spread the good word around the entire on-line community!



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