Lessons from the Box Factory and Beyond
‘You have to like the roller coaster to be an entrepreneur," says Sandy Newman. "You have to have the right temperament. If you need a sure thing, it is not for you." Newman knows what she is talking about. She and her husband were co-owners of one business, Raritan Container of New Brunswick, for about 30 years. She also owns several other businesses, including a real estate business and a parking lot. In her "spare" time she is also a motivational speaker and a life enhancement coach, working with professionals and business owners.
Newman speaks about her approach to business at the next Woman Entrepreneur’s Breakfast, sponsored by the Rutgers-Newark Small Business Development Center, on Thursday, July 14, at 7:30 a.m. at the Rutgers University Management Education Center at 111 Washington Street in Newark. Donation: $10. To make reservations call Awilda Rosales at 973-353-5950.
Of all her many businesses, Newman says the box factory is "the last place that people who know me would expect to find me." When she and her husband, Bernie, purchased the business, neither had any experience with manufacturing or selling boxes. "I owned a ceramics business and my husband was a musician," she says. But with two young children to raise, they decided they both needed to find a more family-friendly type of work; something that allowed them to stay at home with their children on nights and weekends.
"We wanted day jobs, something that could be run during the business day," she says. "We decided on something industrial because my husband had had some factory experience." They looked at a lot of businesses, Newman said, and settled on Raritan Container for several reasons. "For one thing the technology was simple; fabricating corrugated boxes was something we could do. The other big draw was that we could afford it. The business had no employees at the time except the owner, and he wasn’t doing so well."
The business gave them "the lifestyle we were hoping for," says Newman. "We raised our kids. Our son is now a surgeon and our daughter is in publishing and I’ve been married for 40 years to the same husband."
They recently sold Raritan Container, but selling the box business has not slowed Newman down. "The typical entrepreneur has more than one business. There are opportunities everywhere and sometimes they just smack you in head. An entrepreneur picks up the opportunities and runs with them."
Her coaching business is just one example. "People always seemed to be offering to take me to lunch and pick my brain, plus I was mentoring for the SBA (Small Business Administration) and NJAWBO (New Jersey Association of Women Business Owners). I heard about coaching and a trained to be a coach in 1998." Helping other business owners through her coaching is "sheer joy," she says.
What does Newman see as the keys and challenges to entrepreneurial success? Her best advice, she says, is "don’t run out of money!" But she also has a lot of other suggestions for how entrepreneurs can make sure that that doesn’t happen.
Don’t take no for an answer. "Always find another way. If the bank says ‘no,’ ask ‘how about if we do it this way?’"
Think about where you are struggling. "If you can’t get along with someone, look for the truth that you are not seeing. Why isn’t it working? If there is something you don’t do well, maybe you need to hire help. Think about why."
Money is how you keep score. "If you aren’t making money, look for something else that will," advises Newman.
Develop a fabulous network. While you may not be able to "do it all alone," says Newman, it is better to "do it effortlessly." That means finding others to help you or do it for you. That is true networking, she says.
An active member of NJAWBO for many years, Newman uses her work with the statewide businesswomen’s organization as an example of "effortless working."
"I needed some funding for a project several years ago and I wanted to ask a particular congresswoman for help in getting it. I could have just cold-called her. Instead I called around until I found someone who was a friend of the congresswoman and asked her to call and make the introduction." Newman got her meeting with the congresswoman and she got her funds. "If I’d just cold-called her myself, do you think I’d have gotten the money?" she asks.
Use your network. Once you’ve developed that network, don’t forget to make use of it, Newman says. Make connections and introductions for the people in your network. It will help both you and them. "People are happy to help you," she says. "It flatters them to be asked. When someone called to take me to lunch and pick my brain I was flattered to be asked and I loved the lunch."
Find something you can be the best at. Raritan Container could not compete head-to-head with the really big companies, which owned their own trees. They became successful by finding their own niche in the box industry. "We make small and unusual boxes," she says. "We found the place where we could be the best."
Rock the ship, but don’t wreck it. The entrepreneur’s curse is boredom, says Newman. That’s one reason so many entrepreneurs either own several business or a series of businesses. "But we need to learn how to shake things up without wrecking them," she adds. As a coach she has often seen people who have made their business so successful that they can no longer run it themselves or "run it the way the used to." They are frustrated and often unwilling or afraid to hire a manager to help them.
"As things grow they act in different ways. A seven-year-old doesn’t act like a 14-year-old and a 14-year-old doesn’t act like a seven-year-old," says Newman. The same holds true for the different stages of a business’ life.
As your business grows, decide what role you want to play in it," advises Newman. "If you are good at running a business, but you’re not a great technician, hire a technician. If you are a good technician, hire a manager. You can’t be everything to everyone or you end up being nothing to anyone."
Although she and her husband have sold Raritan Container as a way of "transitioning into retirement," Newman says she is not ready to slow down. "Maybe retirement is the wrong word," she says. "I’m transitioning into the next step." Although she is not sure exactly what the next step will be, she is sure of one thing: "I’ll continue to make money because I get a kick out of doing it." – Karen Hodges Miller
From Migrant Worker to Media Mogul
When viewed from the ground floor, the path to a position in the corporate hierarchy can look like a maze of political intrigue, with a single misstep meaning a detour into oblivion. But by carefully viewing the obstacles, hacking them away one by one, and focusing on the destination, individuals can reach these higher strata.
Yrma Rico’s transition from migrant worker in California to a multi-millionaire businesswoman, the head of a television network, was fueled by her highly developed observation skills, her ability to mold herself to her environment, and her willingness to take risks and "follow her passion."
What she says excites her most about the business world is the chance it gives her to help people and watch them grow. Recently she completed a book with co-author Nancy Garascia, "La Vida Rica: The Latina’s Guide to Success at Work & in Life," in which she shares her journey and offers business wannabees pragmatic insight into finding the right work and moving up in the business world. Although the book is oriented specifically to Latinas, its observations are applicable to all women, and, in fact, to anyone who wants to succeed in business.
Rico speaks about the book on Thursday, July 14, at 7 p.m. at the Robert Wood Johnson Hamilton Center for Health & Wellness. The event is cosponsored by Friends’ Health Connection. Cost: $15. To purchase a ticket, call 800-483-7436 or visit www.friendshealthconnection.org.
Much of what Rico shares in La Vida Rica grows out of her own life experience:
Find your passion. Rico defines a passion as "something you enjoy doing without having to look at what the dollar signs are." If you are waking up in the morning dreading going to work, you need to work at finding your passion. Ask yourself: What makes me happy? What would I do if I weren’t being paid for it? "We tend to get too caught up in the rat race and don’t take time to figure out what we are really passionate about," observes Rico. Volunteering, she says, is one way to try out new areas and develop some experience.
Rico’s passion is helping people to grow. "I love the TV industry because I have a lot of folks who come at the starting level," she says, "and I can see them grow into their positions." When they are ready, she likes to take the next step: recommending them to a bigger market, "having developed the talent where they can go anywhere and fit right in."
Ask yourself "How can I get from here to there?" When she was a teenager working in the hot sun picking peaches, Rico realized that the women packing the peaches had the best job – they had shade and free use of the bathrooms. She observed their work, figured out a faster way to pack, showed it to the foreman, and after that, she too worked in the shade.
Similarly, at age 21, she noticed an ad in a local paper for a dental assistant. When she arrived without a degree, resume, or experience, the dentist asked her why she was applying for the job? Her response: "You have an 80 percent Spanish population, and I am bilingual." A week later he hired her. He trained her to answer phones and make appointments, and she took night classes to get a license to take X-rays. She stayed for five years, until she got divorced and moved to Fresno, California.
Take chances. In Fresno, through a boyfriend, Rico was asked to act in a commercial. Despite her fears, she figured that the worst possible outcome was that they wouldn’t use the tapes, so she agreed to do it. That was her entry into the television field, where she started in sales, then moved to management, and finally to ownership. By taking advantage of what she assessed to be a reasonable risk, she invested her life savings – some $2,000 – in Entravision, now a $425 million communications company that reaches 80 percent of U.S. Latinos. When the company went public, she became a wealthy woman.
Move to pursue a career opportunity. Speaking about both Latinas and women in general, she says, "We have to take a chance and get out of our security environment." Often Latinas and women don’t want to move because they have a base of family and friends where they currently live. But Rico stresses the importance of pursuing job opportunities elsewhere. "I’m a firm believer that you need to experience and explore other areas and markets," she says. "You can always go back, hopefully as a more successful, worldly person."
Prepare to meet new people. When preparing for a meeting, trade show, or conference, do some research. Find out who will be there and prepare intelligent questions for likely attendees. "When you introduce yourself, don’t say ‘how’s the weather?’" she advises. Your opener might instead be, "I understand you just purchased this company…." If she sees a group of people talking, she’ll walk up to them and say, "Hi. How are you? I’m Rico."
Rico says she used to be very shy, the sort of person who cried if people looked at her the wrong way. But despite her shyness, she says, "I felt that if I didn’t do it, nobody else was going to do it for me."
She attributes her willingness to communicate to the fact that her parents, who spoke no English, depended on her to interpret for them, because her two older brothers "couldn’t be bothered." She remembers once going to a Ford dealership with her parents. Her father looked at the sticker on a two-tone white and blue truck and was ready to leave because it was too expensive. Rico, at 15, remembers saying, "That’s a starting point; we negotiate from there." Her father responded: "The dealer will think we can’t afford it." Rico replied: "Let me handle it." Then she bargained them down about $1,500.
Be ready to leave a bad situation. The appropriate response to office politics depends on the situation, says Rico. Sometimes things need to be addressed head on, but sometimes it’s better not to get involved. If you are planning to get in the middle of something, however, she advises that you know all the facts. If you are going to confront a co-worker or a supervisor, you must also be prepared to move on.
Rico herself had to walk away from a situation in Providence, which she left with flair and with considerable money in her pocket. She worked for a station there that was bought and sold four times in the five years she worked as national sales manager. Although each new group would make changes, she says, "I kept my head down, did my job, made my numbers, and they left me alone." But the last group decided to merge her position with that of general sales manager and offered her a job as an account executive. She refused in no uncertain terms and asked what they would offer her to leave.
"They made a ridiculous offer," she says – two weeks’ notice and a check. Realizing that they had no legitimate reason to demote her and that the man who replaced her didn’t know the market or the clients, she told them their offer was unacceptable and consulted a friend about what to ask for. He gave her a list that included six-months’ compensation. When the company then asked her to sign a form that she was "not going to pursue a lawsuit," she let them know her attorney would have a look at it. In the end, they gave her both the money she had requested and a letter of recommendation.
"Sometimes pushing you out works better for you," observes Rico. "Had I not been pushed out, I might have still been there."
Keep in mind the learning potential when selecting a new position. When Rico left the radio station, she took six months off and then sent her resume to Univision. She was offered positions in five major cities, but chose Dallas, a smaller city with a smaller market and paycheck, "because the general manager there was a gentleman I thought could learn a lot from – someone who didn’t have an ego and who would groom me." Eventually that job led to her being a founder of Entravision.
Rico has left Entravision after a 25-year career in television and has invested in two new ventures. One is a marketing company in Denver in partnership with one of her daughters. The other is a BMW dealership in Fresno, where her other daughter is marketing manager and her son-in-law is her partner.
Rico attributes her willingness to pursue new opportunities to her father, who "came across the border to find a better life for his family." He came to the United States with a pregnant wife and two kids – without an extended family, not speaking the language, and without a job or a place to live. He moved the family back and forth from Texas to California for three years to take advantage of migrant work, and he did not believe in accepting handouts, welfare, or assistance. Eventually they settled in California. Of her dad, Rico observes, "He was never afraid to try anything." – Michele Alperin
Family Planning Protection
The tax man cometh. Following hard on the heels of that cloaked specter with a scythe, the IRS visits every family in the midst of their mourning and demands its share of the estate. Those who have had the foresight to establish tax tools such as family limited partnerships and family limited liability companies may, however, be able to cut their state and federal bites considerably.
Complete with caveats, procedures and option lists, the New Jersey Institute of Continuing Legal Education offers "Family Limited Partnerships and Family LLCs – Planning and Current Issues" on Thursday, July 14, at 9 a.m. at Prime Hotel & Suites in Fairfield. Cost: $159. Visit www.NJICLE.com. Speakers include Richard Greenberg of the Woodbridge law firm of Greenberg & Schulman, and attorney Martin Shenkman, author of "The Complete Book of Trusts" and many other legal texts.
A native of New York City, Greenberg attended Case Western University, earning a B.A. in accounting in l970. He then returned to his home town to earn his law degree from St. John’s University, CPA certification, and a masters of law with a taxation specialty from New York University. Keeping close to the financial realm, Greenberg served as CFO for Argus Research, the global investment service provider. His firm of Greenberg & Schulman counsels both individuals and business clients.
The Family Limited Partnership (FLP) is basically a tool for protecting a family’s assets and keeping them in the family. "It gives some leverage," says Greenberg. "It minimizes both the tax liability for transfer of funds within a family, and uses less of your total gift exclusions. But the process is tricky and you have to very, very careful."
Establishing the FLP. Like any partnership, the FLP is a legal entity, like a corporation, which is brought about with the state’s permission. Aided by legal counsel, the family files a certificate with the state and the FLP is brought into existence with a registered ID and tax number.
The real key to the FLP’s advantages comes from the types of partners established. General partners hold controlling interest, allowing them to vote and incur liability. Limited partners have neither vote nor liability, but can share in the partnership’s distributions. Thus a father may set himself up as a general partner, with his three children as limited partners. The father can even split his involvement, making himself a one percent general partner and 49 percent limited partner, thus lessening his own liability.
The father can then put, say, $1 million into the partnership, and the money can be distributed periodically to family limited partners. The protections of such a partnership, even beyond the IRS demands, are several. Unlike a corporation, monies may be transferred within the partnership with no tax. The general partner may, if specified, prevent transfer of the funds outside of the partnership. Divorce settlements and creditor claims (if they came after the partnership filing) cannot lay claim to partnership funds. Also, funds need not be distributed – they can be reinvested.
Naked and unprotected. Every taxpayer is allowed to give away $2 million over the course of his lifetime. Any amount over that can be taxed at up to 37 percent. Without FLP or FLC protection, if John Taxpayer has $1,200,000 and three children and he dies in 2005, a whopping $235,000 goes to taxes and the remaining $965,000 is left for his heirs. (Cash dispersals made to a spouse are not taxed.)
FLP tax benefits. Greenberg says that the IRS is far from enamored of the FLP and its tax-shielding properties, but the government does honor it when it is run precisely. If John Taxpayer has set up an FLP he may transfer money to his children at a greatly reduced rate. If he opts to give 10 percent of his $1 million partnership to a child, this gift may be valued at considerably less than $100,000.
"That $100,000 is not so much cash, but a share or percentage of the partnership," explains Greenberg. "Yet since this percentage is for a limited, nonvoting, partnership share, this asset becomes tough to value outright." To adjust for this lowered value, the IRS allows a 40 percent discount in such transfers. The 10 percent gift becomes, in the eyes of the tax collector, $60,000 in actual, taxable assets. This means it uses up only $60,000 of the $2 million lifetime gift exclusion.
With a little planning, a taxpayer can give, say, $50,000 into the partnership every year for 10 years. Using the minority discount, he claims only $30,000 of his lifetime exclusion each year. When his time comes, that $500,000 – and all its income growth – is removed from the estate’s tax liability. This leaves his heirs with a total tax bill of $37,000, instead of $235,000.
Further, individuals may gift up to $11,000 annually to a single recipient with no gift tax. (If husband and wife join together, they can give $22,000.) By gifting through the FLP, mom and dad can give each recipient as much as $35,200 gift-tax free annually.
FLCs for entrepreneurs. The Family Limited Liability Company (FLC) provides substantial insulation from creditors, while at the same time being taxed like a partnership. As in the FLP, family shareholders must file with the state to bring the FLC into existence. The company may own houses and personal use items. But, insists the IRS, the FLC must have a business purpose. If the purpose of this business is to protect the family summer home from estate taxation, you are skating on very thin ice.
The same minority discounting system applies to shares transferred within the FLC. This means that shares given to limited partner beneficiaries receive the exclusion. Generally business owners and part owners have found this a more sure and accepted tool for estate planning than the FLC. Yet the intricacies for each are boggling.
In the end, most lawyers, and even many tax lawyers are not totally familiar with the FLP versus FLC benefits. And though woefully overworked, the IRS tends to spend hours on FLP claims. "Trying to go it alone or with an inexperienced attorney may be possible," says Greenberg, "but it is almost a sure form of fiscal suicide." Enter carefully, though, and you may be able to save yourself – and your heirs – a bundle.- Bart Jackson
Consultant, Heal Thyself
As common as ice tinkling in glasses, comes the statement at every cocktail party: "Yes, I think I’m going to start up my own consulting business." Legions of America’s downsized, retired, or simply independence minded workers have taken on an entrepreneurial task that consists, in the main, of telling bigger firms how to do it better. Corporations, for the most part, have been receptive.
Before setting up shop as a consultant, advises the Institute of Management Consultants, get your own house in order. To aid those launching such an enterprise, the IMC’s New Jersey chapter offers the roundtable seminar "Practice Management for Consulting Practices" on Monday, July 18, at 6 p.m. at the Doral Forrestal. Cost: $60. Visit www.imcnewjersey.org.
Addressing the full spectrum of a start-up consulting firm’s needs are Lorraine Kasprazak, founder of Advantage Marketing in Westfield, who speaks on advanced marketing methods; accountant and financial planner Leonard Steinberg of the West Windsor-based Steinberg Group, who speaks on fiscal and organizational planning; and John Molnar of Trenton’s J. Molnar & Associates, who introduces JEMS Software and other high tech consulting aids.
Kasprzak’s own story provides an excellent model of consultant niche marketing. A native of Bay Shore, Long Island, she earned a B.S. in chemical engineering from Manhattan College in l984 and was urged to head into research by her professors. "I was good at it, but miserable," she says, "and business seemed much more exciting."
After obtaining her MBA from New York University, she returned to the scientific realm, working for several environmental service firms. "These companies were full of brilliant people who could barely communicate with each other, much less the public and businesses beyond," she recalls. Seeing the need, and having made the acquaintance of a number of potential clients, she opened Advantage Marketing, which specializes in helping engineering and research firms make their services known.
Over the threshold. Almost anyone with the right expertise can glean a few initial clients from among their old clients, business cohorts, friends, and relatives. "But after you have plucked all that low-hanging fruit, the question is what next? – and that’s when most start-ups falter and fail," says Kasprzak. Faced with a world of marketing choices, most new entrepreneurs spring into action in every direction at once.
Since overhead is typically low, consultants seldom need to be in such a big rush. New clients should be less hustled up than scanned and selected. Likewise, publicity avenues should be analyzed thoroughly for cost return before any money is committed.
Presentation phobia. "Probably the biggest blunder new business owners face with presentations is thinking that the content is simple and easy," says Kasprzak. Too many executives, under the guise of professionalism, make the presentation all about tactics, toys, and spectacle. Like showing off your muscles to win a data entry job, this flash is unlikely to be appreciated.
Instead, Kasprzak suggests, assess the people with whom you will be meeting. The CFO will always have an eye toward dollars saved, CEOs on the other hand, typically are seeking new markets and larger sales. Learn your audience, their positions and backgrounds, and then pitch something to each individual.
There is a time for the full dog and pony show, particularly with large formal clients. But the more personal and informal your presentation meeting, the better your odds of getting your message across. "I’ve heard that perhaps you might be needing a little help in…" makes a nice opening for your potential client. "He will tell you what he wants," says Kasprzak. "Let it be your job to listen and solve."
Media selection. Few consulting firms start out with large budgets for anything, let alone advertising. Therefore the questions becomes less of which media, but of how do play it. The burgeoning world of blogs, while disorganized and seemingly confusing, can offer some real opportunities. Generally, blogs fall into two categories. "Steer clear of the Gripe & Groan blogs, published by individuals desperate to bring their own opinions to light," warns Kasprzak, "but ads or articles placed in the very specific interest blogs, for example distribution of Turkish jewelry or aficionados of 1920s Rolls Royces, can really win you a devoted clientele."
When working with E-mails and newsletters, again, content is key, insists Kasprzak. Audiences now demand that websites not just blurt out product names, but exhaustively inform. Once your newsletter is set, test it out on cohorts and trusted clients. Then, to expand your circulation, go through your client list and provide coupons for current readers who pass the newsletter on to others.
Often the sheer enthusiasm and genius of the consultant’s service can carry the marketing day and make the sale. But neither boundless energy nor a brilliant knowledge of innovative software are going to provide the necessary business acumen required to make your startup thrive. "A company’s financial choices must be as individual and innovative as product development," insists Steinberg. "They certainly are as important."
Steinberg is the man you want on your side when squaring off against government runaround, red tape, and tax woes. A native of New York, Steinberg attended Yeshiva University, graduating with a B.A. in economics in l968. He then earned an MBA in international business and finance from Hofstra University and advanced degrees in accounting and financial planning. He is a certified management consultant and an enrolled agent, licensed to represent clients before the IRS. The New Jersey legislature has sought his testimony on the impact of paperwork reduction on business.
Business structure. "It’s amazing how many new companies never ask themselves what sort of form their business should take," says Steinberg. Most consulting firms, beginning from the kitchen table, unthinkingly fall into sole proprietorship. While this structure is the simplest, Steinberg warns that it offers no inherent liability protection. Business creditors can go after your gold fillings. Further, the sole proprietorship provides substantial tax benefits only if you are using a home office. Those who rent offices receive no real break.
Forming an S-type corporation provides ironclad liability protection. And while money transfers typically are taxed within a corporation, the owner can retain an untaxed control of the company income by making himself an employee and paying himself a salary. This salaried owner set-up works particularly well for older individuals, who want to make provisions for later financial planning. Just do not forget that the owner now becomes a real employee: Social Security and other withholdings must be made and paid periodically to the IRS. Pension plans and health care should also be drawn up in such a way as to accommodate future employees.
Limited liability companies are gaining in popularity. The LLC gives partners all the liability protection of a corporation and the no-tax-transfer status of a partnership. "Of course, all of this is based on current state law, which any entrepreneur should have his financial planner examine thoroughly," says Steinberg. Corporations must meet the qualifications and obtain a charter from each state in which they operate.
Cost of business. Steinberg ticks off a list: contract escrow, FICA and Social Security withholding, pension benefits, and payroll deductions. "You would be amazed how many business owners figure out their cash flow projections and never consider these items," he says.
Steinberg is fond of the story of how one client neglected these basics. The man rushed into Steinberg’s office telling how he was going to start a small crosscountry trucking service. He talked on and on about initial capital outlay, vehicle maintenance, operator salaries, and more. Finally Steinberg leaned back in his chair and asked: "And how much is the highway use tax?" The would-be entrepreneur gulped. He had never considered that each state might request a fee to use of its vast roadway network.
"When I figured out that it would cost him over $100,000 a year," says Steinberg, "he decided to get into another business."
The hidden costs of going into business – and particularly tax liabilities – can be mountainous for any start-up. Steinberg’s best solution is to maintain an exhaustive paper trail. Ledgers, daily journals, and notebooks will not only lay straight the course of your business to the tax man, but also to yourself and to any venture capitalists who may want to invest as the business grows.
Probably fewer than 10 percent of those cocktail party entrepreneurs will actually launch a real consulting business. Of those, less than half will still be in business within a year. Much of that success or failure can be pinned to energy, drive, and luck. But that elite percentage, the group that thrives, will doubtless have added to the hard-work recipe working smart, and working with the right experts. – Bart Jackson
Blast Your E-Newsletter
Using E-mail to keep in touch with your customers is one of the hottest trends in marketing today. It should be, says Bev Rossi of Graphic Matters, a graphic design firm based in Hillsborough. "E-mail marketing is the most cost effective way to build a relationship with your customers," she says. "An E-mail campaign can do everything that a direct mail campaign does at a fraction of the cost."
"Blast Your Message through the Internet," is the topic of a presentation Rossi is giving at the next Marketing Club meeting of the Middlesex-Somerset chapter of the New Jersey Association of Women Business Owners (NJAWBO.) It takes place on Monday, July 18, at 8:15 a.m. at Arbor Glen in Bridgewater. Cost: $30. Call Karen Schmidt at 732-868-1300 for reservations.
Rossi’s three-year old company specializes in E-mail and other web-based design as well as in print design and instructional design. She started her company after 18 years of experience in corporate jobs, print centers, and design studios. "I’ve experienced it from all sides," she says.
She uses a group of creative services professionals to offer small businesses "the same services that an in-house design department could offer." While many of her clients are looking for traditional, full-service marketing and design work, Rossi says she also works with small business owners who want to do part of a project themselves. "We’ll help with the things they can’t do or provide instruction and support so they can do it themselves," she says.
E-mail marketing is one area where, with some assistance or training, many small business owners can "do it themselves."
"A lot of business owners want to do their own content in an E-mail newsletter," says Rossi. E-mail marketing is one of the quickest ways for small business owners to establish themselves as experts." A personal trainer, for example, may want to send the "exercise of the week," while a chef could send his clients a "recipe of the week." This type of personal marketing is not really possible through direct mail.
E-mails sent to a large list of people are called "blast E-mails," says Rossi. While anyone with Microsoft Outlook or similar software on their computers can use it to send a blast E-mail, she recommends using a web-based bulk E-mail service. There are a number of benefits to these services, she says, including good feedback and statistics on who is actually reading your mail. "A good bulk E-mail service will provide statistics on how many people open your E-mail and how many click-throughs you have to the links in your E-mail."
With a traditional mail campaign, you often never get notified if an address on your list is undeliverable. "A lot of lists have 10 percent or more bad addresses," she says. If you aren’t notified, you keep sending things to that same bad address. A bulk E-mail service will notify you of bad addresses and also give the addressee a chance to easily unsubscribe to your list. That way, Rossi says, you are not wasting time sending something to a person who is not interested in your services.
How do you find a bulk E-mail service? There are several ways to find one, says Rossi. She also has several tips on finding the right service:
Google it. One of the quickest ways to find an E-mail service is to check on Google or another search engine. She also recommends asking friends which service they use and how they like it. When you get an E-mail newsletter or other bulk E-mail on your computer, check the bottom of the page, the E-mail service will be listed there. When you see something you like, check out the service’s website.
The right size, the right price. Look for a service that is the right size for your needs, says Rossi. "The price should be competitive with other services and consistent with the size of the list you want to send," she says. E-mail services usually increase their fees with the number of E-mail sent per month. "Don’t buy a service for 1,000 names a month if you are only sending to a few hundred."
Good support. A good E-mail service should offer good technical support that allows you to speak directly with a technical service person.
Good list management. The list management features are one of the main reasons to use an E-mail service, says Rossi, so make sure that your service offers what you need. "An E-mail service should take care of maintaining your mailing list." Features to look for includes an automated sign-up box on your website to allow users to easily sign-up for your newsletter, the ability to download your list to other software programs on your computer, and anti-spam features to keep you "spam compliant."
"Don’t be afraid to try out one or more companies," says Rossi. "This is not a long-term commitment. You don’t have to make the exact right decision the first time." Most services allow you to pay on a month-to-month basis, and the cost is low, ranging from about $10 for sending a few hundred E-mails monthly to about $30 for several thousand.
A further benefit is that most E-mail services offer free 30 to 90-day trials. Although there are usually restrictions on the number of E-mails that can be sent out on a free trial, it is still a good way to check out a service and see if you like it. "Try setting up an E-mail and sending it to just 50 people on your list. That way you’ll learn about the service, its ease of use, and if it’s right for you," she suggests.
One of the biggest mistakes a business owner can make is to purchase a list of addresses, says Rossi. Instead, she suggests developing your own list of customers and clients. People are less likely to open an E-mail from someone they don’t know, so a list of people who aren’t familiar with you and your business is almost worthless. Your E-mail address and your subject line are also important in getting your customers to open the E-mail. "Use a familiar name in the address," she says. For example, her company name is Graphic Matters, so her E-mail newsletter is "Marketing Matters."
Once the E-mail is opened, you want to keep your customers reading. Provide them with interesting and informative material that they can use, says Rossi. "Think about the questions you are asked over and over in your business. These are the topics that people will want to read about." Keep your E-mail "short and pertinent," she urges.
Make sure that your E-mail is attractive and easy to read. "Studies show that people are more likely to read and retain something that is presented with colors and pictures," she says. But remember that on the Internet, fast downloading is just as important as beautiful graphics. "A picture is worth a thousand words, but not if it is a burden to open," says Rossi.
E-mail marketing is just like any other type of marketing, she says. "You need to know why you are doing it. Your reason shouldn’t be `Me Too.’ In other words everyone else has one so I need one, too." Instead, know exactly who you are trying to reach and why you are trying to reach them.
E-mail marketing is very satisfying because of its immediate results. "Every time we send out a newsletter I get twice the hits on our website than at any other time that month," she says. The newsletters also up call volume from customers who have been reminded to call because of the E-mail.
"E-mail can make a warm lead warmer," says Rossi. "I call it the soft tap on the shoulder. It is a great way to remind your clients about you." – Karen Hodges Miller
Five Important Princeton Inventions
Princeton is known as the home of Albert Einstein, one of the 20th century’s greatest thinkers. But the small city has hosted many more inventors, says Alex Magoun, curator of the David Sarnoff Research Library.
Magoun speaks on "Five Princeton Inventions That Changed The World," at the next Business Council Breakfast sponsored by the Princeton Regional Chamber of Commerce. The event takes place on Wednesday, July 20, at 7:30 a.m. at Greenacres Country Club in Lawrenceville. Cost: $30. Call 609-924-1776 or visit www.PrincetonChamber.org.
The Sarnoff Library, "one of the best-kept secrets in New Jersey" according to Magoun, is located at 201 Washington Road in a corner of the Sarnoff Corporation’s offices. The exhibits are being renovated, but while the process continues, the library remains open by appointment. To make arrangements call Magoun at 609-734-2636. The library also hosts a website, www.davidsarnoff.org, which contains a tremendous amount of information on RCA and its role in the electronic revolution.
David Sarnoff, for whom the library is named, played a major part in the development of broadcast radio and television. He was appointed president of RCA in 1930 and was active in the corporation until the early 1970s. During his tenure there he helped to further advance not only radio and television, but computers as well.
RCA is no longer located in Princeton. The corporation was sold in 1986, but for several decades, beginning in the 1940s, the RCA Labs at Princeton housed "all research, original development and patent and licensing activities of the corporation and its associated companies." In fact, the 260 acres RCA purchased for the labs was the beginning of the U.S. 1 industrial corridor, says Magoun. The Sarnoff Corporation still uses the site, and continues to nurture inventors, some of whom develop new technologies and then start companies to grow them. Generally the Sarnoff Corporation, successor organization to the David Sarnoff Research Center and to RCA Laboratories, maintains a financial interest and provides development assistance.
When most people think of the role of New Jersey in the electronic revolution of the 20th century, they remember Thomas Edison and Bell Labs, says Magoun. However, Sarnoff and RCA Labs were also responsible for developing a number of important inventions or improvements that have affected modern life. Sarnoff, says Magoun, "believed in the possibilities of social improvement through technological progress." The Bell Labs in Murray Hill and the RCA Labs in Princeton "were responsible for inventing or innovating nearly every device that enabled the birth of Silicon Valley, Asia’s dominance of the electronics industry, and the digital revolution."
Television. Sarnoff formally introduced RCA’s electronic monochrome television system in 1939, and the world’s first electronic color television system in 1946. While the beginnings of television go back to 1880 and a French engineer, Maurice LeBlanc, it is hard to deny RCA’s role in developing broadcast television into the major influence is has been for more than half a century.
The answer to who invented television "depends on how you define television," says Magoun, and on whether you choose "an elite or populist view of historical causation." In other words, should inventions such as television be credited solely to one or two "geniuses" who first develop the concept, or the first working model, or should credit also be given to those who took that invention and improved on it?
To make television into what it is today has required not only hundreds of other inventions, but also the people who financed those inventions. Magoun obviously comes down on the side of the broader view of invention, not only for television, but for a number of other RCA technologies as well.
Transistors and LCD displays. The transistor is just one of many examples of Magoun’s view of inventions. While credit for the invention of the transistor goes to scientists from Bell Labs, who first developed it in 1947, RCA Labs also played a major role in developing the transistor. Says Magoun, "there are many types of transistors, and RCA Labs also holds patents on many of them." In 1962 Steven Hofstein and Fredric Heiman of the Princeton laboratory invented "a new family" of transistors called metal-oxide semi-conductor field-effect transistors, also known as MOS FET.
While some might think of transistors as "old technology," having something to do with old-fashioned transistor radios, the MOS FET is an example of how one invention leads to the development of another invention. Magoun explains that far from being obsolete, transistors are still very important in today’s world of computers and are crucial to the development of LCD (Liquid Display Crystal) screens.
"MOS FETs along with TFTs (Thin Film Transistor) control your LCD display screens today," says Magoun. MOS FETs are important, he adds, "because they use very little energy. "About 120 million of them are used on each Pentium IV computer."
Another RCA invention, the CMOS (complementary metal oxide semiconductor), also helps to power modern computers. "Some people estimate there are more CMOS transistors in the world than there are pieces of paper," says Magoun.
Computers. RCA was also active in early work with computers. "The labs had exceptionally talented people working with binary counting as early as World War II," says Magoun. The Bizmac, RCA’s first commercial computer, was put on the market in 1954. But in the world of inventions, as in everything else, time and money plays a role. RCA had to choose between promoting the color television and working on computers. It chose television. "By the time RCA was ready to enter the computer market, IBM was already dominating with about 90 percent of the computer market," says Magoun.
He considers the company’s lack of attention to computers "a sad story" in the history of RCA. "There were people at the labs in Princeton in the early 1970s who had developed an early personal computer," he says. "If RCA had switched its emphasis the history of home computers might be different."
Television Cameras. Without a way to record pictures to broadcast, there was no point to broadcast television. RCA actually began its work on improving television cameras at the request of the U.S. government during World War II, says Magoun. The cameras were used to photograph Japanese ships at sea. At the end of the war RCA continued to improve its technology for use in the commercial market.
Indeed the name for the "EMMY" awards can also be considered a "Princeton invention," says Magoun. "When the television industry decided they needed an award similar to the Oscar awards they decided on ‘EMMY,’ a more feminine version of ‘IMMY,’ which was short for Image Orthicon Tubes, another RCA invention that was used in the early television cameras."
Sarnoff "was not an inventor, an engineer, or a scientist," says Magoun. "Instead, as a corporate manager and executive for RCA he became technology’s champion, especially for broadcast communications." The result of Sarnoff’s vision and his work with electronics permeates the day-to-day life of nearly every person on the globe in a way that few things do. – Karen Hodges Miller