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Networking has grown in its importance as a promotional tool in the last decade. For ages, sales people have kept business cards on file. But what makes today's networking activities unique is the comprehensive approach that firms take to doing it well. This approach makes networking a key business activity, not just a sideline that happens when the opportunity arises or when you need to make a sale.

Networking is one of very few promotional tools that can be used easily, and cost-effectively, by small and large businesses alike. Only a limited range of promotional methods are open to businesses. Some of these methods, like broadcast and print advertising, can become prohibitively expensive to the small business owner. Small businesses are generally unable to afford an ongoing market presence, limiting their use of such methods to short term bursts of promotion. This does not help small businesses help develop a loyal customer base.

Networking is refreshingly different. It is a highly effective promotional tool that is also cost-effective and fun to do. Businesses have always known that word-of-mouth and personal referral are the most effective promotional techniques in the marketplace. Networking allows the entrepreneur to build a circle of contacts which lead to both types of sales. Combining networking with personal selling is a proven combination which can lead to success for small businesses. But how should an entrepreneur go about building the networking function for his/her business?

First, start by finding out what kinds of networking activities exist in the business community. A call to your local Chamber of Commerce, or local community business association, can be a useful starting point. Many organizations have subcommittees that deal with small business issues. If you have the time, consider volunteering for such a committee.

Second, contact a network training company for advice. Check with your local Board of Trade or Chamber of Commerce for referrals to networking organizations. Check the Yellow Pages for training companies that offer networking skills training.

Third, join as many professional and business organizations as you can afford. With adequate follow-up the money spent on networking can become the greatest promotional investment. Be selective about the organizations that you join. Make sure they link you with potential clients or mentors.

Mentoring is the process of learning through role modeling and consultation. Mentoring is an effective way for entrepreneurs to gain insight and experience at the hands of those who have been in the trenches longer, and have learned even more. Networking with other successful entrepreneurs can allow you to gain from their knowledge and experience which is an added bonus.

Fourth, look at philanthropic opportunities as networking opportunities. Taking advantage of giving to charities, or sponsoring athletic teams, gives back to the community, while developing an opportunity to network with new contacts.

1- have a variety of networking opportunities. If everyone you network with is exactly like you, you aren't spreading a wide enough net.

2- follow through on your networking commitments. You have to be in the marketplace to get the business, and you have to show up to the networking events to see results. To insure adequate follow-up, schedule your networking events like any other part of your business day.

3- be prepared to give as well as receive. If you expect referrals to your business, be prepared to refer to others. The networking experience is a two-way street.

4- add value by offering the benefit of your experience. Participate in seminars by sharing your experiences. Others can benefit from your knowledge and experience as much as you can benefit from theirs.

5- take advantage of a marketing opportunity, no matter how small. Take booth space when the opportunity emerges, as long as you can afford it.

6- networking is a long term process. The results can take months, even years, to build. For this reason, your firm should use other promotional methods alongside your networking efforts.

7- get out of your comfort zone. Many entrepreneurs seek opportunities in their own backyard because it is comfortable and familiar. Usually, there isn't enough opportunity in your own backyard to sustain your business.

8- if you end up networking with the same people month after month, it is time to build a broader networking base because you are covering the same territory. Your future lies in building your market, not simply maintaining it.

Networking can be profitable and fun. Don't overlook the networking approach regardless of how big your business is. Even a small business can become a mega-networker!

Tips for Running a Lean Business

Running a business requires a lot of stamina and creativity. These qualities insure your ability to market the business successfully as well as manage its resources wisely.

There are two schools of thought about how lean the business should be. Some like to maximize their initial investment buying all of the bells and whistles from the very beginning. Others like to grow slowly, starting low-budget, investing in fancier furnishings and offices as their revenues grow.

Experience can be a cruel teacher. Any entrepreneur with 15 years experience has probably weathered two devastating recessions, one in the 80's and another in the 90's. They have learned that when your resources are stretched you can be very stressed.

Franchises are good investments due to the fact that they require investors to have cash upfront to do the job right. Most fast-food franchises require $500,000 to $1,000,000 in capital, much of it unencumbered.

This assures the franchisors that franchisees will make the required investment in buildings and furnishings to be consistent with the business plan requirements. Those who are faint of heart need not apply!

Many entrepreneurs fear that not making substantial upfront investments in place and fixtures will result in a poor company image that will thwart their marketing efforts. This is true in some industries.

But, there are a number of things that you can do to run a business on the lean side without looking like you can’t afford to be in business. Some of the greatest business expenses are relatively invisible to your customers.

First of all, justify all of your expenses. If the costs do not increase your bottom line profitability, don’t spend the money. You can measure the success of advertising to be sure it pays for itself. You can forego many promotional offers because all they will do is cost money, but with little return.

Do as much as you can for yourself, especially in the beginning. When the time you are spending on miscellaneous chores cuts into your ability to run the business effectively, or make sales, hire someone.

Don’t hire more people than you need. Often, you can hire part-time people or subcontractors. Maybe you need a reception person for part of the day. Voicemail and email may suffice for part of the day. Use call forwarding from your business to your home during that time.

Do you own decorating, unless you have really bad taste. When your business grows, reward yourself by hiring a decorator. This way you will have an enviable office space without having to incur the decorating cost at the beginning when your firm is most vulnerable.

Buy second hand office furniture. One trip to many office supply stores will find you shocked at what it costs to set up shop. Consider getting first quality second hand furnishings from a liquidator, then buy the good stuff when your business can afford it.

Invest in a quality ink-jet printer to do quick turnaround in-house printing. The cost of technology has come down substantially in recent years, allowing even the small business to have access to photographic-quality printing. This approach is very handy if you are in a business which requires you to write business proposals.

Use print shops wisely. Get a good logo design upfront and find a reliable printer. Then, get 1,000 business cards printed. They can last you through the first turbulent years of your business and it is cheaper than getting them printed in smaller lots.

Use simple promotional materials. The full-colour, glossy photo spread makes a nice brochure presentation, but will cost more than most startup budgets will sustain. Consider simpler designs on low-gloss paper. Even black and white with one colour can look professional and tasteful. As your firm grows you can get more creative and spend a little more.

Make sure you have adequate promotional materials to accommodate direct mail, telephone requests and the occasional trade show. This will probably require letterhead, business cards and a simple brochure treatment.

For trade shows, consider renting a table-top booth display until you can buy one of your own. Then, using your printed matter and your colour printer you can create the actual board display. Add Velcro® to your display material and you’re done.

Many individuals save considerable money when starting out by locating their office in their home. However, be certain that zoning laws do not prevent this opportunity before making a commitment to start a home-based business.

Business concepts come and go, but the basics of business finance remain the same: make sure that you have viable business opportunity and keep costs to a manageable level, especially in the beginning.

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