Posts

In this week’s small business success story, we check out a business that practically ground to a halt during the shelter in place.

Business at Dilecta Wines in Paso Robles, Calif. froze in March when Governor Gavin Newsom issued the stay at home order. The tasting room was suddenly closed and there was no word on when it would reopen. Overnight, owner Orion Strang found himself facing an uncertain future.

Orion says it was scary in the beginning. He took quick action by cutting payroll and streamlining the workflow. He also spent much of his time planning for what to do when things reopened. Now that restrictions are easing, he has a plan in place to succeed.

small business success dilecta wines orion strang paso roblesA Plan for Success

Even before the shutdown, Dilecta Wines offered tasting appointments so clients could receive the wine maker’s personal attention and story. Now, those tasting appointments are spaced out and have smaller groups to allow for social distancing. While that might seem detrimental to business, it has had the opposite effect. Clients are receiving a deeper level of connection with the winemakers and that’s translating into sales. It’s also offering a unique experience that visitors don’t get with other wineries.

Orion says he expects to book more in-home wine tastings in the future. He is developing more one-on-one experiences for club members and tasters. He’s also exploring the idea of a satellite tasting room in another city or a pop-up tasting in a desirable vacation spot.

How the Past Shaped the Future

Orion built Dilecta Wines slowly, from the ground up, so it’s no surprise that he’s weathering this storm too. He released his first vintage in the fall of 2011 but took his time before opening his tasting room in 2017.

Along the way, Orion has used pieces of his past to help further shape his business. Growing up with an artist mother, he used his unique eye to create the artistic labels that grace the front of each bottle of wine.

Orion is both a sommelier and a professionally trained chef. He has used that experience to add extra flavor to the handcrafted Rhone wines Dilecta specializes in.

Orion also spent years in the wine industry before opening Dilecta. He did everything from hoeing weeds to driving a tractor to doing spreadsheets. That experience helped him streamline when he needed to.

Orion is confident in where Dilecta is going in the future and his experience and spirit make us confident as well. Cheers!

If you’re interested in a remote tasting, please reach out to Orion Stang at Dilecta: orion@dilectawines.com or visit the tasting room virtually at www.dilectawines.com.

Towne Advisory is very proud to know great business owners like Orion. If you would like to find more small business owners who are doing their best in times of crisis, check out our previous posts. Professional Coach Amber Setter is tackling new challenges in the work from home reality. While the Securion Group is helping small businesses deal with the pitfalls of these difficult times. Meanwhile, Killroy Pest Control is offering new services to help people deal with their latest worries. Way to go everyone!

In this week’s small business focus, we’re talking to someone who was perfectly positioned to help small businesses when the shutdown happened. Regina Unegovsky is the founding attorney of Regal Tax & Law. They’re tax controversy specialists that help businesses out with issues like wage garnishments, bank levies, income tax penalties, and bankruptcy. Basically, if owning someone money is stressing out a client, Regina helps slay those dragons.

Regina closely followed what was happening with the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) in Washington, DC. The minute it was approved, she acted. Regina recognized that the provisions within the CARES Act would have a profound impact on her clients. She started reviewing older returns and getting client refunds right away. It helped get cash into the hands of her clients long before government relief loan funds had gone out.

As the Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL) portions of the CARES Act started to take effect, Regina was ready to help clients maintain their payroll and take on that cheaper debt.

Regina Unegovsky Regal Tax and Law small business successNow, she’s working with clients to figure out what’s next. Funds are running out for many small businesses. She’s helping them navigate the difficult decisions like bankruptcy or litigation against non-paying vendors. Regina is also finding them relief from tax debt and helping them renegotiate settlement programs.

Advice for Business Owners

Her best advice for business owners is that this may not be it. There could be a second wave of financial pressure and business owners need to think ahead. The deal to avoid rent now will eventually be due.

Regina thinks many people may consider bankruptcy and if they do, she says get a lot of opinions and get them now.

“Most professionals will give you half an hour or something to get their view. Use this. People are mostly happy to share a little bit of knowledge. Do this ahead of any problem so you have the resources,” said Regina. “You go to the dentist when you notice something wrong, you don’t wait for the root canal. Procrastination is not a strategy.”

As for Regal Tax and Law, Regina is looking towards the future. As a smaller firm, she is already operating lean and mean. She recognizes bigger firms may be laying off quality talent and she’s ready to expand if the right person comes along.

Regal Tax & Law is just one of the many small businesses in the Towne Advisory circle that quickly pivoted and prepared to help clients in the midst of a crisis. For more small business success stories, check out how SchillerLearning began offering options for parents forced into home school. Or how the Wine & Liquor Mart evolved their business to deal with COVID-19. There’s also Security & Cabling Solutions, which is offering safety options for businesses moving forward.

A few months ago, we started looking at small businesses within the Towne Advisory circle that are doing great things to help their businesses survive during this COVID-19 crisis. Recently, we talked to Tony Quintong, the owner of Securieon Group.

Securieon is a company designed to deal with times just like the ones we’re facing now. It offers insightful tactics and implementations for founders and investors experiencing pivotal points in their company’s growth. Whether it’s leadership alignment or sustainable and scalable revenue growth, Securieon is there to help its customers succeed.

Tony Quintong Securieon Group small business consulting expertsTony recognized early on that COVID-19 was changing his marketplace. He pivoted his business to focus on business owners facing the difficult question of whether to stick it out or find an exit strategy.

Over the years, Tony has learned that tough times are what precipitate action with business owners. When they feel both an emotional and compelling financial pain, they start to evaluate their lives and business very seriously. As a child, we would play a game and ask for a do-over. An opportunity to learn from a mistake and re-enter the game with a new strategy. Today, COVID-19 presents an opportunity for a “do-over” where business owners can analyze their past mistakes and embrace a new approach to survive. Securieon was there to help them through that.

When he looks at the current business landscape, Tony believes social distancing is here to stay. He thinks there will be a lot less emphasis on in-person meetings for the next three to five years and his company is adjusting accordingly. They’re building and leveraging their technology and being more strategic on the time spent.

His advice for business owners is, you MUST empathize, connect, and lead with a renewed purpose.

“People need hope combined with strategy and decisive leadership,” said Tony. “Life is full of challenges and perplexing situations. In our line of work, you gotta love jigsaw puzzles! Founders need our expertise and years of experience to guide them through the process of fitting the right pieces together for their next move.”

We’re very excited to see our list of featured businesses growing! It’s nice to see so many businesses in the Towne Advisory circle innovating to survive and thrive.

This week we’re highlighting business owner James Basurto, President of Security & Cabling Solutions, better known as SCS. For more than a decade, James’s company has served the Silicon Valley by putting the customer first. It is that customer care that has enabled SCS to be nimble during this latest crisis.

When the stay at home order was issued in March, James sent home his employees and immediately looked at his business model. He realized that clients were going to need new products if they were going to get back to work.

SCS started offering new services, including infrared temperature reading cameras. The move immediately paid off. The company received new construction clients looking to have temperature taking machines installed on construction sites (they kept operating as essential services).

Building off of that, James is investigating FLIR cameras that can take the temperature of retail patrons or employees. The extra security would allow companies to send people home if their temperatures spike.

James believes that many companies may also install check-in kiosks asking people about COVID-19 symptoms before they enter a building. He’s looking into how he can service customers that way.

James has worked in the industry long enough to remember what it was like after the 9/11 attack. There was an influx of business then. He expects to see another surge in industry demand following the COVID-19 shutdown.

James is also preparing for when retail establishments are allowed to reopen. He’s scheduling projects now so that his employees can jump back into work safely when the time is right.

If you missed any of our other small business features, check out Sift+Pour Bakery, Wine & Liquor Mart, Killroy Pest Control, and Professional Coach Amber Setter.

Real Life = Work Life + Mom Life

In this week’s small business success story, we highlight Executive Leadership Coach and sole proprietor Amber Setter. Amber is a Professional Certified Coach (PCC) who works with executives and other professionals to help them navigate life transitions.

When the stay at home order was issued Amber’s mom-life and work-life collided. Like many parents, she was suddenly juggling work and family 24/7. She found that many of her clients were experiencing the same problems and her services were needed more than ever.

Amber says while her clients vary, she’s hearing a common refrain. “Our illusion of control is broken. People are being more self-reflective for a moment,” said Amber. She says clients are starting to prioritize and look at what they can and cannot live without.

As for Amber, she’s come up with a game plan for how she handles the stay at home order. Because things are changing so quickly, Amber reevaluates her business needs every week. She knows that being open to flexibility and anchoring back to goals is key to managing in the new normal. She makes every effort to work smarter, not harder.

Amber makes it a point to take care of herself. She sleeps a little more and sets aside time to make decisions during moments of stillness, away from outside influences.

Most of all, Amber hasn’t changed the overall game plan of her business just yet. She keeps her eyes on the horizon, while still being cognizant of the present.

To find out more about Amber, check out this article she wrote for CalCPA aimed at early career professionals.

For a look at some of the other small business professionals we know that are thriving during these difficult times, check out our features on Killroy Pest Control, Wine and Liquor Mart, and Sift+Pour Bakery.

Lately, we’ve been focusing on small businesses that have figured out how to navigate these unprecedented times. We talked to Elizabeth at Sift+Pour Bakery who created a social distancing survival kit to help bring in a new stream of revenue and Frank and Peggy Tavarez, who completely pivoted the Wine and Liquor Mart to a virtual sales space to make sure they were following social distancing guidelines.

Killroy Pest Control Family Run Silicon Valley Business

Courtesy: Killroy Pest Control

This week, we look at essential business Killroy Pest Control, which has served Silicon Valley for more than six decades. Lynn Olavarri-Schmidt and Richard Schmidt have seen almost every economic twist and turn imaginable while running Killroy Pest Control in Campbell, CA. So they knew what to do when business in California stopped because of the stay at home order.

Even as an essential business that deals with pests such as roach, spider, and rodent control, Killroy found itself with no revenue coming in. Lynn and Richard sent everyone home and began formulating a game plan for the coming weeks. They contacted customers to make sure the demand was still there. They adjusted the office to adhere to social distancing guidelines.

Employees now take trucks home and go directly to customers instead of meeting in a centralized location. Administrative staff have laptops and home offices to do their work. They now email bills to customers instead of sending them via mail or delivering them in person.

Four weeks later and the essential business is running at about 75% to 80%. Lynn and Richard are already looking at new potential business avenues so Killroy can be #buildbackbetter when the order is lifted. They say the changes have worked, but they’re hoping to be back to the old ways soon. Social distancing has forced them to cut one of the most important aspects of their business, the camaraderie.

Great job Lynn, Richard, and the entire Killroy family!

I need a quick break from the madness, don’t you?

I wanted to highlight a small business in our circle that has taken this opportunity to think outside the box. They have brought smiles to faces while adding a helpful new stream of revenue during this time!

Elizabeth Ging, the owner of Sift+Pour Bakery in Dallas, makes custom cookies and treats. She started playing around with the idea of everyone buying up all of the toilet paper in stores. Elizabeth drew toilet paper on a cookie and said: “There is no shortage here!”

coronavirus business success story toilet paper masks cookies

As the news evolved of potential shutdowns and a decrease in foot traffic, Elizabeth realized it was her job to find ways to bring her product to her customers. She has created “The Social Distancing Survival Kit” and a Rice Krispy Treat Decorating Kit!

Check them out at siftandpour.com.

Kudos to Elizabeth and Sift+Pour for taking steps to be Disaster Proof!

If you have a story of a small business doing something fun, novel, or just extra caring that is helping make them Disaster Proof, I’d love to hear about it. #DisasterProof. #TASC

In these incredibly uncertain times, I’m fielding a lot of calls from current and past clients about what they can do to manage the current state of their businesses and hopefully emerge on the other side battered, but still in business and ready to ride the good times upwards. You are not alone!

The problem with a situation like the one we’re facing now is that no one knows when it will get better. It could be next month, it could be next year, it could be a lot longer than that. In the past few weeks, business has slowed in most professional industries. Most companies have gone into a holding pattern as they try to react to what’s going to happen next.

Please do not react, be proactive instead.

If you haven’t read it yet, check out our previous post about how businesses can responsibly and ethically use a situation like the one we’re facing to grow their business.

In this post, I’m going to look at how you can prepare your business for the worst without destroying your team or your business.

Expand Your Customer Base

Now is a great time to look at other avenues that your business can expand to. Some people call this diversifying your revenue.

“If any single buyer represents more than 10% of your business — or your top five clients together account for more than 25% — you need to diversify,” according to Forbes.

Think of this as putting all your eggs in one basket. If you drop that basket, the eggs break. By the same token, if a company that represents 10% of your revenue goes bankrupt, what’s going to happen to your business?

Look for ways to create relationships with new clients. Is there a service that you can offer that will help businesses or people feel safer during these uncertain times? Is there another market that your services can enter into at this time? Is there another use for your services in an industry that is impacted at this time? Once you have revenue, you have choices.

For example, if you normally deliver flowers but your business is at a standstill, can you use those same delivery trucks and drivers to deliver something else? Can you offer your services to a local supermarket? Can you start package delivery for Amazon? You already have the infrastructure set up, can you fill an emergency need and expand your customer base?

Automate

There are hundreds of apps out there to manage workflow within the office, keep track of your social media accounts, and manage your daily calendar.

If you haven’t already, set up some of these apps.

Automation of common tasks within the office will help manage employee time and make your business move faster. A program like Zapier, for example, will help you integrate various software systems within your office.

When you use it, you can set it up to take an order from a customer on your website, create an invoice in QuickBooks, and then send that invoice to your customer through MailChimp all without lifting a finger. Suddenly, a sale is made without a person getting involved. It’s all automated.

When done correctly, automation frees up your employees to focus on what truly matters within your business—serving your current customers and growing your customer base.

Look at every line, not just the bottom line

During good times, it’s easy to look at the bottom line and think if your net profit keeps growing, then the business is doing well. But while you’re watching that bottom line, the number of line items above it could be growing.

Now is the time to stop and take a look at everything your company is spending money on and what percentage of the revenue that spending represents. You need to ask yourself, is this cost essential to the business or is it discretionary?

Note: You should be looking at your spending two to three times a year whether or not the economy is doing well, but at this time, it’s a must-do.

Essential expenses such as salary, taxes, utilities, etc. are expenses that are necessary to run your business. But are there any ways to cut this down temporarily? Or even permanently with technology?

Discretionary expenses such as travel, food allowance, video production, and advertising are expenses can be cut down or cut out if necessary. They are more wants than needs.

Keep that discretionary spending under control. Ask yourself, can this expense be reduced? If it can, then will that reduction hurt the business or the growth of the business? Weigh all of these factors and then decide if cuts can be made.

Odds are, you’ll find one or two cuts that can be made without hurting your business or your business’s growth. You’ll also be able to identify cuts that can be made in the future if revenue streams slow down.

Manage your debt

Once those cuts are made, put that money to good use. Spilt it between paying down your company’s debt and socking the money away.

You do not have to pay down your debt all at once. Some debt is considered healthy for a business and in tough times, it’s important to find a balance between debt and a nest egg. If you’re uncertain, talk to your financial adviser or accountant. Interest that you pay on business debt is usually tax deductible and your tax CPA can advise you on that.

You also need to remember that some debt is worse than others. If you’re feeling uncertain about what debt is “good debt” and what debt is “bad debt” ask us. Every business is different and you always want to make sure you get professional advice for your specific situation.

Keep an eye on what the government is doing

Federal, state, and local governments are all working to make sure that local businesses and workers are not completely flattened by this sudden stoppage. On Wednesday night, President Trump signed the Families First Coronavirus Response Act into law. Among other things, the law creates rules for small and midsized businesses to offer paid sick leave and family leave to employees forced to stay home because of the coronavirus. NBC in Washington has a good Q&A about what the bill means for employees and Inc.com looks at some of the key provisions of the bill as they affect businesses.

States like California are also taking extra steps to try and make things easier for businesses and individuals. California’s Franchise Tax Board has extended the filing and payment deadline to July 15 without penalty. While in Illinois, the Governor’s Office is working to secure federal grants from the Small Business Administration to try and offer relief to small businesses. The SBA is (and has for a long time) had special disaster relief loans which are being strengthened specifically for this time period.

Cities and counties are doing what they can. In the City of San Jose, where Towne Advisory is based, city officials have set up a specific webpage to help small businesses navigate these difficult times and get help when possible.

Keeping an eye on what your local, state, and federal governments are doing will be an important step to making sure your business gets the best help possible.

Please stay safe and healthy.

Ben Towne

No one wants to see something like the recent outbreak of the novel coronavirus make headlines around the world, but it happens. It’s undeniable that the worldwide spread of the novel coronavirus has had an impact not just on our everyday lives, but in the way that we do business. World markets have felt the impact as well as supply chains and to a lesser extent, consumers. And with the full impact of the virus still unknown, the economic impact could get worse before it gets better.

Now businesses can react to this impact in a few ways. Some businesses will conduct business as usual, operating as if the novel coronavirus will have little to no impact on what they do and how they operate. Other businesses will plan for the worst and lose sight of what they’re doing in the present.

And some businesses will see the novel coronavirus as the unfortunate business roadblock that it is. It’s something that exists whether we like it or not and we can either run from it or find a moral and ethical way to make sure our business comes out on the other side of it stronger.

Never take advantage of the customer

Before I get into the ways a business can overcome novel coronavirus and come out the other side stronger, I want to make sure people understand what I’m talking about. In no way, shape or form am I suggesting that a business take advantage of the consumer. Price gouging, also called profiteering, is not only bad karma but it can be illegal.

If you own a company that makes hand sanitizer, by all means, advertise but don’t price gouge.

No matter what you do as a business, remember that human decency should always come first.

Do satisfy a new, temporary need

However, your business can still use a world issue like the novel coronavirus to its advantage. Ruth Fisher, economist and CEO of Quantaa says, “During pandemics and other such crises, people avoid crowds and public spaces. A company can commercialize on this by tailoring products or services to this situation: enable people to access or use the product or service at home or in a venue that’s physically separated from others.”

A great example of this is Netflix. As the New York Post reports, while the S&P 500 lost points in the final week of February, Netflix’s stock rose. Netflix is a company that’s specifically set up for people who want to seclude or quarantine themselves. “Social distancing” as a business model.

Think of this in terms of yourself. What would you do if you were stuck inside all day, whether it’s just for one day or a series of days? There’s a reason why companies like Amazon, Zoom Video, and Netflix as well as work applications like Slack are gaining so much attention during this outbreak.

Sometimes a temporary method becomes permanent

The spread of the novel coronavirus could be the opportunity a company needs to infiltrate a saturated market.

“When the pandemic subsides, a lot of people will have found that the stopgap (temporary) product/service fills their more general needs, and thus adopt that measure permanently,” says Fisher.

In particular, Fisher sees the novel coronavirus as having the potential to speed up current trends in home delivery of products and services, as well as employees working from home.

Company goodwill

Sometimes your company is not in a position to fill a commercial need during a pandemic or crisis. That does not mean that you should pretend that the crisis does not apply to you.

“A company can earn reputational benefits or goodwill by putting the needs of its employees or the community ahead of its own,” says Fisher. “This will increase loyalty of employees or community. For there to be real value (and not just empty virtue signaling), however, the act must be costly to the company.”

Johnson & Johnson, for example, is a leader in the health industry. To date, the company has donated 1 million surgical masks to impacted areas of China, 48,000 bottles of alcohol, as well as money and other supplies necessary for battling the outbreak in China.

Companies like Facebook and Google, who don’t have the healthcare inventory that Johnson & Johnson does, can use its buying power to build company goodwill. According to CNBC, Google will donate $1 million to Mountain View organizations to support small businesses after the company canceled its annual Google I/O conference. Facebook is donating $500,000 in San Jose after canceling two of its conferences in the city. Both companies are also donating millions of dollars in free advertising to help the World Health Organization (WHO) battle misinformation on the internet.

As these actions show, goodwill doesn’t have to be a concept thrown around by valuation professionals, it can be real positive karma that your company builds by the actions it takes in the world.