Transcripts For MSNBC Your Business 20101017

hi there, everyone. i'm j.j. ramberg, and welcome to "your business," where we give you tips and advice to help your business grow. a historic midterm election is about to take place, and this year the concerns of small business owners are front and center in the political debate. nearly 100 candidates with some small business experience are running for congress this year. sam granado is running for one of utah's senate seats as a democrat. he operates a deli business started by his late father. and jim henessey is running as a republican for the 16th congressional district in ohio. he runs a small financial consulting service and owned and operated nursing home facilities. his candidacy has been endorsed by the national federation of independent businesses. great to see both of you guys. >> thank you. >> sam, i'd like to start with you. how has running a small business informed your decision to run for office? >> well, running a small business, certainly i've been in the trenches, i've hired people. i felt that we've been nlected for too long by a lot of our elected officials. and i've also been in public service, not just running a small business. so i've dealt on both sides of the aisle. >> jim, do you feel the need of small business people are being met? >> no, not at all. again, when small business actually employs 67% of the people in our country, we need to look at small business owners and get them back to where they can employ people. that's -- that's not happening right now. and i've been a small business owner for 28 years. i also was mayor of my community. so i saw it from both sides. i was on the planning commission. i see things from both angles. and it's important that the small business owner, that they're represented because they are the employment mechanism of this country. >> if you had to kind of rank the reasons why you're running for office, why you want your voice to be heard and the people you represent, is the highest one or one of the highest ones that small business aren't being heard? >> well, i think in the 16th district clearly it's jobs. we have unemployment that's gone from 6% to close to 12%, 12.5%. it's jobs. and when the small business owner is the driver of jobs in this district, in this country, yes, we've -- we've got to make sure the small business owners are heard. >> sam, what are you going to -- should you win, what are you going to for when it comes to small business? >> i'm going to fight for tax breaks. i'm going to fight for incentives for small business. and i'm going to fight for the future of small business, including my children and grandchildren. i'm looking into the future to see how we can leave them a better program. >> and jim, should you get elected, what will you be fighting for when it comes to small business? >> well, certainty and predictability. right now the small business owner has no certainty, no predictability about their future. they don't know what their taxes are going to be. they don't know what -- utilities are going to be. if cap and trade continues to be pushed as an agenda. there are so many uncertainties for the small business owner when they wake up and say, what is my future, what are my interest rates going to be. >> do you feel like things have gotten better? have they gotten any better, jim? >> in the 16th district, absolutely not. i keep traveling the district and finding more and more people. the health care bill that was just passed has caused health care premiums to go up. people don't know -- i talked to a small business owner the other day. his health care premium went up 68%. with that 68% increase, he has no clue what he's going to. do he's actually had to lay a couple people off. so no. not at all. the cap and trade issue is another issue in the district. 88% of our district is oil-based, and it's a problem when you rely on -- i'm sorry, co coal-based. when you rely on coal, 88% of your energy, and ultimately you're concerned about what those costs are going to be in the future, too. >> sam, what about you? do you feel like things are getting better? >> i feel that they need to improve. i feel that we're a status quo right now. we're starting to see some daylight, but we need people such as myself to be elected, to get in and bring it back for small business. we have too many attorneys back in washington. and not enough people that have run businesses and been in the trenches. >> all right. sam granato, and jim henessey, thank you very much for coming on the program. we appreciate hearing your insight. >> thank you. >> thank you, j.j. some people are natural-born negotiators. they're just good at that whole game of bargaining. but frankly, most people aren't. it's tricky, it can get uncomfortable, and it can get contentious. but look, it is absolutely something you can learn how to do better. recently, i went to new york city's fulton fish market where haggling over the price of fish is considered a fine art. there i met joey "tuna" centrone. he's known as the picasso of penny pinching, and he gave me a few tips. >> $11.85. >> i'm coming in here. admittedly, i know very little about fish. >> right. >> i'm here with a mission because i have to buy some fish. what would i do? >> there are four things. number one, you must know your product. whether it's fish or stocks, you have to know the kind of commodity that you're dealing with. in this case, you'd have to know the quality, the size, the species. you can't look at a red snapper and say, how much is that blue fish? that's not a good thing. >> because they will take you for someone who doesn't know what they're talking about, and they're going to. >> somebody who just fell off a banana boat. you have no time for that. >> so do your research. >> the second thing is you have to know yourself. you have to elk dxude confidenc. be firm when you can and not firm when you need to be. >> that's a good negotiator. >> the third thing is know the person that you're buying from. you have to know if he's -- has a lot of product, he's got a little product. if he's sitting on a lot and you know he's sitting on a lot, he's probably going to be a lower price than somebody else. >> you said know the person you're negotiating with. >> yes. >> you're talking about knowing their supply. supply and demand. what about knowing them as a person? is that helpful? >> with any business, you know the person, you know the guy on a daily basis, you're going to probably get a better price than somebody else because he likes you. >> when you go into a negotiation, do you have a number in the back of your mind saying i am willing to pay or sell at x? >> yes. >> i'm not willing to go over or under. >> most times. >> you'll get to that point if you have to. >> you don't want to lose money. at all costs, you want to make as much for your company as possible. you're going to try and maintain a certain number. >> how do you decide when to be tough and when to be nice? >> you back those hazelize -- bat those hazel eyes at me, you're going to get away with it once. twice, maybe. three times it's not going to work. you got to depend on knowledge. you really have to depend on knowledge. >> by "nice," i wasn't referred to flirting. >> okay. >> by "nice," i'm saying how when you should be sort of a hard, you know, drive a hard bargain? >> again, that has to do with availability. how much product is around. and how many people want it. it's supply and demand. there's a lot of supply, and everybody wants it, the price will stay moderate. if there's not a lot of supply and everybody wants it, the price is going to stay high. and there's a fourth thing that i didn't mention yet. >> which is? >> one second. you got to try and fit in. you're not going to get anywhere dressed like that. >> all right. i'll see you in a sec. let the me put this on. >> love the look. >> much better. >> clipboard, no one can be a purchaser without a clipboard. all right? >> all right. >> hold it close to you like this. so nobody can actually see your business. >> is there anything on this clipboard? >> absolutely not. and a pencil. you have to have a pencil. know the seller. these guys are big met fans. i brought you a met hat. makes you fit in, they're going to like you right off the bat. >> all right. hey, there. >> hey, bobby. >> yeah. good to meet you. >> nice to meet you. >> know your product. >> how much for the jumbo? >> jumbo for $5.50 and the large are $4.50. >> $4.50? jersey or long island, these? >> those are from jersey. >> know yourself. >> this your best price? >> that's my best price for the best quality. i have less quality for cheaper. >> no, i'm not interested in any less quality. >> okay. >> know how high or low you can go. >> one box for my best box of fish is $4.50 is the best i can do. >> there is my first time here, i'm going to be coming back here a lot. so let's make a deal. first time, beginning of doing business. not the end. >> in good faith, i'll charge you $440 and hopefully you'll come back. >> $440 -- $4.40. >> i'm looking more for like $4. >> i can't do it. cannot to it. >> what if we split the difference there? between $4 and $4.40? >> you got a deal. hopefully i'll see you next week. >> how did i do? so that was certainly a lot of fun for me, and i actually learned a lot about negotiating. so let's turn to this week's board of directors to talk to them about how to negotiate. reva lasonsky is founder and president of grow biz media. she has a column at "allbusiness.com. and president of the marks group, writes a column for "the new york times." good to see you. >> good to be here. >> clearly in batting my hazel eyes. >> it worked. >> i was like -- >> you were really in your element there. >> especially the mets hat. >> that was fun. negotiating is hard. it's really hard if you're uncomfortable with it. but it's something you can learn. you think you're good at it? >> no, i don't. in fact, the fact that i think that i'm not probably makes me worse at it because i think i psych myself out. >> it's try. a lot of it is about confidence. >> and that guy, when you were talking about trying to get him down on the price of the fish, he went silent on you. which i'm -- is a tactic because you're compelled to say, okay, i'll give you -- because somebody has to fill the silence. and generally, that's me. >> i've got to tell you something, j.j. it's like an expertise like anything else. those guys, when you watch them, these guys negotiate. they're selling and buying commodities, and this is what they do for a living. and the lesson that you learn as a business owner, there are some people that can coo doo things really well -- can do things really well and some who can't. i would be as lost as with that stupid mets hat on, walking around the market trying to like do a good deal. you saw the way they were looking at you. you were a complete newbee. it's something you can't be good at for a while. >> in business school we had a negotiations class. they split us up and said, okay, you guys negotiate over e-mail, you do it over the phone, and you do it in person. >> right. >> what do you think happened? >> right. >> i'm asking for a guess. >> i engine person had to be better because it's establishing the relationship. and i think that's what's part of it where the guy took you for flirting. i funding you're talking to somebody, the -- i think if you're talking to somebody, the next time, hey, how you doing, the mets were great last night. now there's a personal relationship there, and they're going to give you a better deal. >> then again, if i can say, sometimes in person is good, sometimes by e-mail is good. my company sells software. there are a lot of guys that do not want to be talking on the phone. they're fishing for the best price. they want to exchange or e-mail. that's what they want. these are i.t. guys, they have no personalities. you got to know your customer. these guys, they want some kind of communication going on. but that doesn't mean it's right for everybody. >> i think also this interesting idea of having this -- this price that you will, if you're selling, like you will not sell under that price. >> right. >> and if you have that, it's kind of a toss-up. you can feel comfortable. i know when i get here i'm going to stop. on the other hand, you might get there too quickly. >> right. it's that you're going to walk away. so you can't be that invested in anything. because you may have to walk. and literally you're going to have to do it. and i think that's difficult. but at the end, you know that you saved your company money. and that's what's important. >> you know what i've seen the best people negotiate -- i can't stand it when people are not honest about what they know and what they don't know. if you're going to walk into the fulton fish market and try and negotiate with w these guys, if it were me, i'd say, guys, i've never done this before, teach me. and i realize i maybe won't get the best price the first time. but i think that will be appreciated. >> that gets to be the relationship. that's like batting the hazel eyes. if you're disingenuous it might get you the first time, second time, but never again. >> and i won't wear the phillies hat, by the way. >> this is fun, i love negotiating. this was fun to talk about. >> a great piece. >> thank you. still ahead, where's the money? how to raise funds quickly through your receivables. and scott griffith, ceo of zipcar. we'll find out how he got this booming business on the fast track to success. here at "your business," we love giving advice to small business owners. we want to hear from you. tell us which of our many segment have helped you. go to yourbusinesssurvey.msnbc.com. in 2008 i quit venture capital to follow my passion for food. i saw a gap in the market for a fresh culinary brand and launched behindtheburner.com. we create and broadcast content and then distribute it across tv, the web, and via mobile. i even use the web to get paid. with acceptpay from american express open, we now invoice advertisers and receive payments digitally. and i get paid on average three weeks faster. booming is never looking for a check in the mail. because it's already in my email. zipcar, the world's largest car-sharing company, is in the fast lane. with 400,000 customers called zipsters and 7,000 cars, the company is on the road to raising $75 million in an ipo. in this week's "learning from the pros," zipcar ceo, scott griffith, shares his thoughts on keeping thing simple, saying no, and personal innovation. ♪ >> there is a very complex business model. there's all these things happening in the background. there are now 500,000 people sharing 8,000 or 9,000 cars across 14 major cities. you can imagine the complexity going on in the background. keeping that simple so that the customer feels like this is a really simple experience that i enjoy doing is a complex problem. and one of the challenges we face is how do we do that. we've created a culture and a set of values around keeping the whole concept simple. and in fact one of our five core values is keep it simple. so we've really made that a mantra of the company. [ beeping ] >> we have lots of great ideas, ton of them all the time. we can't do them all in. order to keep it simple, it's sometimes harder to say no than it is to say yes. when you're in my seat, sometimes you have to say no. you want to listen and create a culture of entrepreneurship and new ideas, but be at times forceful and say we can't do that, we have to focus. [ squealing ] >> another of our core values is to deliver results. this is a complex business model. and we have to figure out how to make money. we learned during the bubble of the internet days that big ideas can create active web sites and lots of excitement. but some of them don't ever make money. this business always ran the risk of doing that because it's asset intensive, and you sort of have all these cars everywhere. and you're open 24 hours a day so you have to have high service levels with lots of fixed cost. deliver results became an important part of our core values so that people understood we're not just delivering a service to the customer, we have to make money. we have shareholders. [ screeching ] >> one of my personal core values is make failure my friend. and i think you have to embrace failure. it's hard. it's not very fun sometimes to go back and reflect on it. but i think true great leadership or students of leadership are good at assessing their own personal failures. and understanding what happened. there's nothing wrong with that, and it can be so instructive next time you come across a similar situation. [ honking ] >> because we're growing so fast, our ideas so big, just for me to keep up as a leader of the company, i need to go through personal innovation to make that happen. you have to figure out who do i want to surrender myself with, what do i want to do with there time, what mark do i want to make, what's valuable to me, and what's valuable to the people around me in terms of culture and core values. and so i've spent a lot of time thinking about that, and the concept of personal innovation drives you to keep doing that. you can't stop and you can't do it once and then forget about it for ten years. every once in a while, not maybe even every year. i've really tried to reflect and go through some personal innovation. three or four times since i've been here at zipcar, i think i've made a pretty big change in how i've led, how i've communicated, what i've done with my time as a leader of the company. those are big innovations in my own personal growth curve. it's been exciting. we get tons of questions here about how to raise capital. well, there's one solution in the marketplace that you may have never even considered. selling your accounts receivables. nick perkin is co-founder and president of the receivables exchange. he's here to tell us a little about what this is. great to see you. >> thanks for having me. >> explain in a nutshell what is the receivables exchange. >> in its simplest form, we're a marketplace where sellers are small, medium companies looking for capital, working capital, cash flow. and they come to our exchange, our marketplace, looking to sell their receivables. and then we connect them online with buyers who are banks, hedge funds, family offices, institutional sources of capital. so we're the marketplace that sits in the middle between the sellers and these buyers. >> so i can always sell my receivables. how does your exchange make it better or easier for me? >> well, it's faster, right. we're a more flexible 21st century solution than the traditional elements that are out there, right? the traditional way is maybe you go down to the corner financial institution and ask them to ande you a loan that could take 30, 60, 90 days, but in the 21st century, not many people have 30, 60, 90 days to get capital for business decisions they have to make. what we're saying is, let's connect 21st century access to capital to the 21st century speed of business, velocity of business, that's the philosophy of the company. >> i have, say, i don't know,$50,000, i need capital to keep it going. does it make sense to come to you? is there a downside? is tech spencive? >> a few things. our marketplace is business-to-business companies. if you're a consumer company it wouldn't make sense, so business-to-business invoices. sells are have two yeefars of operating history. those are minimums to be a seller on the exchange. you know, what our exchange allows a seller to do ultimately is take control of the process. if you think about traditional mechanisms of accessing capital, it's very much the seller, the small, medium company going to an institution saying how much will you give plea me at what price? >> i set the price, people bid on it real time. it's changing who has control in the process. in our case the small, medium business is picking which invoice they want to sell, at what price they want to sell it out. >> can you say what you're getting on the dollar? >> it's market driven. as sellers sell more on the platform they get a better price. it's 99 to 98 cents on the dollar is the range is what you get, i mean, in at the end of the delay you're paying one to two cents on the dollar. >> was good. >> think of it this way, as you move around, say you're a small, medium company and go from one person giving you capital to another, you have to start all over with them again. >> right. >> in our case, sign up one time, and every time you transact it's available to every single buyer so you never have to go through the process. >> if you're a small company and interested in doing this what kind of information do you give to the buyers so they know actual actually your clients are good, good for making good on receivables. >> there's a registration process. the key thing that the buyer wants to know is, is this, in fact, a real operating entity? hence, why we have two-year operating history requirement and are invoices selling real? we allow the seller to take partial control of that process, but generally speaking, we provide the -- all of the credit information necessary for the buyer to make a buy decision. >> where do we find it? >> www.receivablesexchange.com. >> thank you very much. >> in an uncertain economy, collecting all of your outstanding invoices becomes more important to your company's survival. here now are five tips for collecting late payments courtesy of bloomberg "business week." number one, make sure you have a credit policy in place. always consider clients' credit histories and insure they're aware of your payment terms. two, withhold future deliveries, warranties or service requests from clients that are behind on their payments. number three, hire a collection's agency or attorney. these professionals are typically industry-specific. four, review your legal options. for example, invoices under $5,000 can be pursued through small claims court. number five, act fast. whatever strategy you choose to employ, do it as soon as your invoices are past due. likelihood of receiving late payments drops dramatically as the months pass. it's time to answer some of your business questions. back with us once again. the first question an owner of a paul mitchell partner cool. >> what some of the most creative ways you've gone about obtaining capital for your company? >> robbing a bank. >> that could help. >> looking for creative here. >> yeah. >> we, a lot of small business owners are looking for money, looking for capital. something i do, look for partners and not necessarily equity partners, but you know, i wanted to do like an advertising campaign in the philadelphia area, i couldn't afford to do it. i couldn't get financing to do something like that so i brought on a cull of people in a like-minded field and we all chipped in to do something like that. i'm not talking about going into business with people or bringing in somebody to take stock of your company, if there's a piece of equipment to buy, something you can share with others, you can raise capital that way, it can work. >> that's really smart. >> it depends what you're raising money for and what business. she has some hair salon, is it product, is it people? what do you want? how are you going to do that? one of the things that people say, probably it's start-up, even growing, never touch your 401(k), and i'm not a financial analyst, i'm not going to say, yeah, it's okay. think about, before the market crashed several years ago, if we had gotten some money out, we -- and invested it in our businesses -- i know for me -- i'd be better off. we all lost a lot of money in that. so i think the idea is to explore everything and not be afraid. >> take a look at everything. >> yeah. >> great. let's move on to the next one. a question from eleanor, does it make sense to do a really big, one-time, new customer discount for my store just to get people in the door? an interesting question, particularly because of companies like groupon -- >> can't believe you said that, exactly right. great example. >> retailers or service providers give you 50% off, try to get you in the door. >> right, and then what? >> do you think it works? is it worth doing that? >> somebody sued groupon because they brought too much business and weren't prepared for it. they shouldn't have sued, i mean it's something that's common. i would not, like, go all out on that. once you get them in the door you have to, one, meet their expectations but what are you going to do to get them back the second time? >> the question is, is it worth the cost of what you're losing for the discount? >> j.j., not enough people give away stuff for free. phone companies are giving away free phones to get new customers in the door. we -- in my company we give away stuff for free. we give away soft ware. we bring people in, people using software, customers, people that are interested in using it quick books, that's free, and it costs me to do that, we're giving it away but it's our chance to show them how smart we are in what we can do and we do advertising. >> you think it's worth it. >> i really do. people get to us us that way, hopefully they'll come back and buy stuff. >> i think it's different for a retailer. there's a cost to what you're giving away. >> also make sure you're not a commodity. >> exactly. >> someone will go to where they can get -- >> they're going to shop around. loyalty programs. bring them in, start a loyalty program. >> good point. >> thank you for all of this advice. great to see both of you. if any of you have a question for our experts, go to our website openforum.com/yourbusiness. hit the ask the show link to submit a question for our panel. openforum.com/yourbusiness or e-mail questions or comments yourbusiness@msnbc. we often talk about how angel investors are expertise for business investors. check out our website of the week. angelcapitaleducation.org. you can check out helpful articles, links to related sites, and listings to angel groups around the country. the site founded by the entrepreneurial support group the koffman foundation. to learn about today's show, clicken our website openforum.com/yourbusiness. you'll find all of today's segments, plus web-exclusive content with more information to help your business grow. and don't forget to become a fan of the show on facebook. we look forward to getting some of your feedback. also follow us on twitter. it's at msnbcyourbiz. next week, meet entrepreneurs who found overwhelming success in the booming industry of appl apps. >> we realized there is some potential, not to sell 7 million copies, but you know, to make this a full-time job that we can enjoy and earn a decent living. >> find out how small teams of developers are going head-to-head with big-time studios and in some cases dominating the market. until then, i'm j.j. ramberg. until then, we make your business our business. in 2008 i quit venture capital to follow my passion for food. i saw a gap in the market for a fresh culinary brand and launched behindtheburner.com. we create and broadcast content and then distribute it across tv,

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