Employees? Who needs them? Terri Adams has managed to avoid hiring a single one as principal of Adams Consulting Group, based in her Princeton home (email@example.com)
It’s not that Adams advises owners of small businesses to do it on their own. What she has done herself — and preaches for others — is the development of strategic partnerships to provide help when it’s needed. For Adams, networking at chambers of commerce and similar organizations doesn’t mean just looking for potential customers. She also keeps her eyes open for people whose business strengths and knowledge areas complement her own.
Adams talks about “Strategic Partnerships: Grow Your Business without a Staff” at a meeting of the Middlesex-Somerset NJAWBO chapter on Monday, February 27, at 5 p.m. at the Somerset Ramada. Cost: $35. RSVP to firstname.lastname@example.org or to Mary D. Podolak, programming vice president, at 732-432-7754.
With experience ranging from restaurant management to organizational development, Adams started a small business consulting practice in 2001. “I found that one thing I didn’t want to create initially was employees,” she says, because she didn’t want to deal with the consequent management and tax issues. Instead, when faced with a large contract or project, “I would reach out to partners who would go away when the project was done.”
One of her partnerships is with someone Adams met through the Princeton Chamber who develops promotional products. A big part of her business comes from corporations who ask her to do training for a big product launch or a new initiative. If these companies are also looking for a package that includes promotional products to symbolize the new product line or vision, then Adams turns to this partner.
This way she can deliver what she calls a “more holistic proposal.” And it turns out to be cheaper for the client than an “a la carte” approach. Because she uses this partner exclusively when she needs promotional expertise, he also gives her a special discount that she can pass along to the customer. In return, says Adams, “each time I have an opportunity to refer or integrate promotional products, he will get the business.” The cycle continues when a client contacts him with a new initiative, and he might ask, “Who is helping you to launch this new product line?”
Based her own experience, Adams offers this advice about partnering to other small business owners:
Go for the big contracts. Even though you are small, you don’t have to limit yourself to small contracts. “With partnering,” she says, “you can deliver a more well-rounded product rather than try to get a sliver of the pie.” Suppose you write marketing copy and someone needs a website. You’re good on the words, but you may need a designer who knows how to position copy in a user-friendly way, and you may also need an website optimizer, who will put in key words so that search engines call up the site. Tapping these partners means that you may be able to get a big contract that you never could have gotten on your own.
Find partners before you lose business. Small operators can lose contracts either because they are perceived as too small to handle a large contract or because they don’t have available skills complementary to their own. Adams asks, “Moving forward, are there likely partners you could be scouting out now?”
Don’t expand your company. Expand your network of partners instead. Remember that business is cyclical. If you hire when you are in the middle of a crunch, those employees may have little to do when business slows down.
Befriend big business. Many large companies cannot be bothered with small projects, and, in part because of their high overhead, need to charge top-of-the range fees. Still, they want to hang onto customers. The solution can be to refer customers with small projects to trusted owners of small businesses, who are happy to take on the small projects, and who are able to charge less for doing so.
As an example, Adams says that a big accounting firm with high fees may have a continuing alliance with a smaller firm that is more affordable for certain customers.
Share the cost of doing a trade show. With charges of $1,500 to $3,000 for a booth, trade shows may be beyond the means of small businesses. One option for two businesses that sell different things to the same audience is to share the cost and the leads generated.
Seek out complementary partners. Ask yourself, “What other services would round out what I do?” One potential partner for Adams was a staffing agency, because its clientele was similar to hers. “Their target is human resource departments who either manage temporary or part-time employees or place full-time employees,” she says. “Sometimes in my business, the human resource area is my main partner in establishing a new initiative like management development.”
Determine whether a potential partner is the right partner. If you meet someone at the Princeton Chamber, for example, ask yourself not only whether you like them, but also whether you trust them. Ask who else they know in the chamber, and then talk to those people. If you get a good feeling, and have done due diligence, then go ahead.
Start very small and see how it goes. If the person seems substantial, honest, and ethical, then propose something low-risk — like sharing a single lead. If it works out on a small scale, go larger. The next step may be to share five other contacts or to move to more substantive sharing. Adams tried out her promotional products partner with a growing bank, which was instituting a new management development program. “It was a small project and went well,” says Adams, “and he gave me a good price.” Slowly they have been expanding that partnership with riskier ventures that require a larger up-front investment.
Learn about how your partner works. Adams is now working on a project with a new partner, whose expertise in leadership and strategic planning complements her own in developing effective management teams and increasing productivity. They are now creating and testing a three-part “webinar,” or online seminar, and preparing chunks of information for “attendees” to download ahead of time. Their projected audience is CEOs and owners of small to midsize businesses.
Adams observed how her partner worked, looking at how driven he was, checking out his efficiency, and seeing if he was able to keep costs under control.
Make sure each person’s tasks are defined. Set expectations about what the goals are and what each partner expects to gain. Adams and her webinar partner have agreed to a 50-50 partnership. Partners must also decide how to measure what each one is doing and how to determine whether their collaboration has been a success. Make the goals specific. In this project, the partners’ goal is to cover costs and get “great testimonials” to use in marketing their next webinar.
Draw up a contract. Make either a formal or an informal agreement, depending on the level of partnering. If there are a lot of dollars at stake, Adams advises involving legal counsel. For the bank’s promotional products, she and her partner had a one-page agreement specifying the discount Adams would get, and the discount he will get if he refers her or if they land a joint project with one of his clients.
She and her webinar partner are drilling out an agreement because they have to invest money up front. They are also using the agreement to identify the roles and responsibilities of each person, quantify what each expects to gain, and lay-out what will happen to the business and its profits if one person becomes disabled or dies. The agreement will also include what will happen if the partnership dissolves.
“If money is at stake, people are greedy,” says Adams, so agreements must be made in advance. An agreement should also include liability and insurance.
Adams, the youngest of five children. didn’t know what she wanted to do with her life until she turned 30. After she received a degree in accounting from LaSalle University, in her hometown of Philadelphia, she went to work in the field, but every time she went out to clients, they would ask, “Are you sure you are in the right field?” Most accountants, she explains, were not as verbose and relationship-oriented as she was.
Since she had always wanted to own a restaurant, she decided to investigate that industry. In Philadelphia there were two restaurants she especially liked. When one told her they would have an opening in three months, she suggested that they hire her immediately and rotate her through the business — kitchen, pastries, waitressing, back office — and that in the end she could be a manager.
But there was a big downside to the restaurant business. “I had no life,” she says. Adams got a master’s degree in education, with a focus on organizational development, at Temple University, and then went after a position in the hospitality business. “I knew what it was like to run a business and now I had the theoretical information about how to make organizations work better,” she says. Her first job, at Scanticon, brought her to Princeton in 1988.
Then she moved to Merrill Lynch, where her first position was in management and leadership-development training. When she had to move to South Carolina for her husband’s job, Merrill Lynch allowed her to telecommute. A promotion brought her back to Princeton, where she worked in succession planning in the technical division, then moved into sales, helping financial advisors work together in teams and position themselves effectively with affluent clients.
In 2001 Adams took a voluntary severance package, and went out on her own. For the first couple of years, she used her connections at Merrill Lynch to get most of her business. Having worked with financial advisors, though, she knew better than to have all her eggs in one basket and made a conscious effort to broaden her base.
She loves working for herself, and says that only once in four years did she think about going back to work for someone else. The biggest challenge for her has been the unpredictability, but now she puts money aside for the low times, and, team builder that she is, she has a group at the ready who can step up to the plate when she is busy.