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Choosing a janitorial service may sound easy, but think of this:Your cleaning service will be in your facility after hours andunsupervised. So it's important to find a service that notonly does a good job but is trustworthy and reliable.The Building Owners and Managers Association (BOMA)International offers these tips:
- Develop a list of specifications. List the areasthat need to be cleaned and what you expect the service to do(dusting surfaces, emptying trash cans, vacuuming floors, cleaningglass doors and so on), along with how often. Indicate the minimumqualifications you require, such as experience, references andinsurance. You may want to use this list to develop a questionnairefor initial screening.
- Prepare a request for proposal (RFP) to obtain bids fromcontractors that pass your initial screening. Be sure theRFP includes square footage, counts of fixtures and otherspecifications. The contractor should examine the premises beforesubmitting a bid.
- Prepare a request for qualifications (RFQ) to ascertainthe professional qualifications, background and experience of thebidder. Ask for client references, financial references,evidence of workers' compensation and liability insurancecoverage, details on the company's hiring practices, trainingand supervision methods, and a list of facilities you caninspect.
- Develop a scoring system to evaluate bidders'proposals. According to a recent BOMA survey, the threemost important criteria in selecting a cleaning contractor areexperience, price and references.
Jacquelyn Lynn is a business writer in Winter Park,Florida.
Collect Call
You've got outstanding bills customers just aren'tpaying . . . how much effort should you make toget your money? It depends on the amount of the bill and the costinvolved in collections. You need to recognize when you'vereached the point of diminishing returns and it's time to writeoff the invoice as uncollectible.
Stan De Groot, national financial services manager for WescoDistribution Inc., a Pittsburgh-based distributor of electrical andindustrial supplies, suggests calculating what your in-housecollection steps cost. Those steps include issuing past-duestatements and making telephone calls or personal visits. Thenconsider your margins and what your actual losses will be if youwrite off the invoice.
With this information, you can set some general guidelines. Forexample, balances under a particular amount will get a certainnumber of letters and calls before they're written off.Balances at a higher level may merit stronger efforts, includingoutside collection activity.
A collection agency can help you determine what balances are toosmall to pursue vigorously. Agencies typically work on a percentageof what they collect, and they know how much collection effortscost.
When you decide to declare an invoice uncollectible, you may beable to use that loss to reduce your taxes on other income. Checkwith your tax advisor first, though; the IRS and state revenuedepartments have guidelines that include some time limitations andrequire you to prove you made a good- faith effort to collect.
The Lease You Can Do
Even a one-person homebased business can enjoy the benefits ofemployee leasing. With employee leasing, you--and any employees youhave--become employees of the leasing firm; your company thenleases your services by paying a fee, which is typically the amountof your salary, taxes, benefits and administrative costs.
The number of leased employees in the United States is expectedto exceed 4 million this year, which gives employee leasingcompanies a tremendous amount of negotiating power when it comes toinsurance and other benefits, which are passed on to you. DaleHageman, president of Accord Human Resources Inc., an employeeleasing firm in Oklahoma City, says it's possible that thesavings you'll realize in insurance costs alone will offset theadministrative fees the leasing company charges. The leasingcompany also processes all your payroll-related tax requirements,giving you more time to focus on your business. "If you canmore productively use your time to produce revenue and build yourbusiness, then you can benefit by outsourcing functions likepayroll and tax administration to an employee leasingcompany," Hageman says.
Leasing companies can be found under "EmploymentServices--Employee Leasing" in the Yellow Pages. Hagemansuggests asking other small-business owners for recommendations,then checking out leasing companies before signing up.
A Case Of The Blues
Every business experiences tough times--a big client takes itsbusiness elsewhere, you need to lay off employees, or you're ina cash crunch and can't offer raises. When hard times hit yourcompany, you or your employees may suffer from depression. Leftunattended, business-related depression can suck the enthusiasm andenergy out of everyone involved--and, in turn, make matters worsefor your business. So as you concentrate on pulling the businessthrough the hard times, don't overlook your organization'semotional needs.
Open and honest communication with employees about the status ofthe company is essential, according to Nancy Garbett, president ofTransition Management Inc., a management consulting firm in SaltLake City. "Employees need to understand what changes areoccurring and what it means for them," Garbett says. If theyare feeling insecure or stressed because they don't knowwhat's happening with the company, they won't perform attheir maximum levels, and they could hinder the company'srecovery and future development.
Don't hide bad news or pretend things are better than theyare--your employees will see through any smokescreen. "If theowner is saying that everything is okay, but in fact it's not,everybody is going to know it's not," says Garbett. Besure your staff understands what the situation really is, what thefuture possibilities are, and what you expect them to do if thecompany's going to get through the crisis. Keep in mind, mostpeople become emotionally attached to their workplace andcolleagues, and trouble in that arena can affect them as much as apersonal crisis, such as a divorce or a death in the family.
You don't need to be able to distinguish true clinicaldepression from the occasional bad day, but you should be alert topotential problems, says Patricia Weik, a consultant, clinicalpsychologist and lawyer with RHR International Co., a managementconsulting company in Wood Dale, Illinois.
Weik says symptoms of depression include feelings of sadness, aloss of concentration, excessive crying, changes in eating habits,loss of energy, guilty thoughts, a sense of worthlessness orhopelessness, thoughts of suicide or even, in some cases, ofhomicide. If you suspect an employee is suffering from one or moreof these symptoms, Weik advises addressing the situation in adirect manner. Talk to the employee privately; say you'venoticed some symptoms and encourage him or her to seek appropriateand qualified help. Don't try to be a counselor, but havereferral options ready and know what type of coverage yourinsurance offers. If you're unsure about your local resources,Weik says the psychiatry department of a reputable hospital is agood place to start.
When talking with a troubled employee, avoid minimizing his orher feelings. "A lot of people will want to back away fromthis uncomfortable situation and say something like `It's notthat bad; things are okay.' What that does for a depressedperson is essentially tell them they're being ridiculous, thatthings are not as bad as they think; and that gets them intoanother negative spiral," says Weik. "You need tonormalize the process for them. Say `Yes, this is really a toughsituation, and most people would feel bad in yourshoes.' "
While encouraging employees to seek help for their depression,don't ignore your own well-being. If you find yourselfexperiencing any of the symptoms associated with depression, takethe time to seek help.
Breath Of Fresh Air
Indoor air pollution has become one of the main environmentalhealth threats of our day. How can you tell if you're sufferingfrom sick-building syndrome? Symptoms include headaches; eye, noseor throat irritation; dry cough; dry or itchy skin; dizziness andnausea; difficulty in concentrating; fatigue; and sensitivity toodors. The causes include inadequate ventilation and chemical andbiological contaminants.
It's virtually impossible to remove all chemical andbiological contaminants, but increasing ventilation and aircleaning is an effective way to deal with the problem. Alan Cohenof Vornado Air Circulation Systems Inc., a manufacturer of aircirculators, air purifiers, humidifiers and heaters in Wichita,Kansas, says installing air cleaners is a relatively inexpensiveway to reduce building-related illnesses and absenteeism, improveproductivity, and demonstrate to your employees that you care abouttheir well-being.
Cohen recommends choosing a high-efficiency unit that can changethe air in a given area four to six times per hour, so be sure toknow the cubic feet you're dealing with when shopping for anair cleaner. Also consider the sound the machine makes; some modelsare noisier than others, and workers may find it distracting. Aircleaners can be purchased at most department stores, home andbuilding supply stores, and office supply stores. Cohen says pricesper unit typically range from $150 to $250.
Release Me?
Your lease is up for renewal. Should you sign a new one, or isit time to buy your own building? Kale Gaston, southeast regionalvice president of GE Capital Small Business Finance in St. Louis,offers these tips for making this important decision:
- Consider the long-term impact on your business. Thiscalculation is easier for some businesses than others, says Gaston.For example, if you're a manufacturer or distributor, it'sfairly simple to project future growth based on your pastperformance. The process will take more thought and research forretail or service companies. Points to consider include tax issues,your plans for future expansion, how you manage fluctuatingbusiness cycles and your plans for customizing the space.
- If you're going to buy, decide between purchasing anexisting facility and building a new one. In a tight realestate market where available inventory is limited, the costs maybe about equal. Certainly you'll save time by moving into anexisting space, and the initial cost outlays will likely be lower.On the other hand, constructing a custom facility can enhance yourlong-term productivity and efficiency, especially if your businesshas unique needs such as loading docks, refrigeration, lab spaceand so on.
- Stash some space away. If you buy, be sure the facilitycan accommodate your needs today and into the future. You may wantto "warehouse" some space for future expansion by buyingmore than you need now and subletting the excess space untilyou're ready to expand, Gaston says.
- Talk to several lenders. Consult with your banker andseveral other commercial lenders who are experienced with financingreal estate purchases for small businesses. Gaston says this is themost important part of the decision-making process. "You needa lender who understands what you do, can provide you with a loanproduct that meets your needs and can grow with you as [yourbusiness grows]," he says. A good lender will sit down withyou in the early stages of the process and help you with financialanalysis and forecasts, then work with you to put the packagetogether and secure the best possible loan terms. Real estatebrokers are usually able to refer you to appropriate lenders; youcan also check with your accountant and attorney.
Gaston says a small business typically begins to consider buyingreal estate when it is about 5 years old. "In the start-upstage, [businesses] need to be putting their equity contributionand loan money into growing the business," he says."After they've leased for a while, and they're growingand need more space, they'll buy a piece of real estate andbuild an investment for the future rather than [paying increased]rent."
Pros And Cons
Sooner or later, you'll have an applicant who answers"yes" to the question "Have you ever been convictedof a felony?" Should you reject that candidate? Notnecessarily, says Paul Salvatore, an employment law attorney andpartner with New York City law firm Proskauer Rose.
To develop a policy on hiring convicted criminals, Salvatoreadvises beginning with a clear understanding of the applicablelegal requirements. Many states have laws prohibiting employersfrom rejecting an applicant strictly on the grounds of a pastconviction. However, a criminal conviction may make an applicantineligible for a job that requires bonding or speciallicensing.
"Once you understand the legal requirements that apply toyour business, you can assess whether the applicant is the rightperson for the job," says Salvatore. This means consideringthe conviction in the overall context of the applicant'sbackground, skills and abilities, and your staffing needs. Forexample, you'd probably view a relatively recent armed robberyconviction somewhat differently than a 20-year-old conviction formarijuana possession.
Salvatore says one of the most common convictions employersencounter on applications is driving while intoxicated. In thatcase, some issues you'll want to keep in mind are whether theperson will be driving a company vehicle or driving his or her owncar on company business, and if he or she is insurable.
Unless you have a legal reason for doing so, a blanket policy ofexcluding applicants with criminal records could expose you toliability. It's always a good idea to be able to demonstrate alegitimate reason for your hiring choices.
It's Better To Receive
When you don't issue your invoices in a timely manner,payments are delayed and your cash flow suffers. If this problemsounds familiar, you may want to consider outsourcing youraccounts-receivable function.
A small but growing number of firms are offering services thatinclude billing, posting payments and collections, or any part ofthose functions. One of those firms is The Out$ource Group, analliance of five companies based in Columbia, Missouri, whichhandles receivables. When choosing an outsourcing resource,Out$ource vice president Bonnie Baker recommends going with acompany that is familiar with the type of work you do and has areputation you can verify. Discuss the various service packages thecompany offers. Most services bill on a contingency basis, chargingyou a percentage of what they collect, but some operate on afixed-rate basis (such as a fee per month or per account).Calculate what you can save in labor, postage, telephone expensesand other administrative costs, as well as the benefits you'llgain from a more efficient system.
Finding a service to handle your accounts receivable may not beeasy; it's a relatively new type of service, and providers arenot always easy to identify. One place to start is with collectionagencies, many of which are diversifying their services andoffering accounts-receivable management. Some bookkeeping andaccounting services may also offer this service. You can also findproviders advertising in credit and collection tradepublications.
Though outsourcing allows you to shift the workload, Bakerstresses that it doesn't mean you can shed the ultimateresponsibility. "Accounts receivable can make or break acompany," Baker says. "We consider this a partneringrelationship. We don't want our clients to distance themselvesfrom the process once they set it up."
Eyes On The Prize
Business trendies have become preoccupied with thinking theirway out of the box; homebased business owners, on the other hand,are trying to think their way in. Dun & Bradstreet's(D&B) Business Solutions in a Box is just one of the prizesluring home office owners to compete in the Homebased EntrepreneurChallenge, a new contest sponsored by D&B andEntrepreneur's HomeOffice magazine. Top awards include acash prize of $10,000, an IBM laptop computer, Proven EdgeProfessional Edition Software, and Business Solutions in a Box,with personalized problem solvers ranging from insurance andfinancial services to marketing and risk management. George Martin,executive vice president of mass marketing for D&B, callsBusiness Solutions in a Box "an enabling program."
How do you qualify for the goodies? Simple. Just gripe to us. In100 words or less, describe how you solved your biggest businesschallenge, headache, nightmare, roadblock or black cloud. If ourpanel of experts thinks your essay is the best, you could win$10,000.
Two monthly winners--from November 1997 through March 1998--willreceive Business Solutions in a Box and a one-year subscription toEntrepreneur's HomeOffice magazine. All entries must bereceived by March 31, 1998. Official rules can be found at left; anentry form is on the opposite page. For more information or toreceive an entry form, call (800) 357-7299, ext. 420.
Contact Sources
GFA Management Inc., P.O. Box 47024, Indianapolis, IN46247, (317) 888-7156
The Mac McIntosh Co. Inc., (310) 376-1221, http://www.salesleadexperts.com
Savannah Bar & Grille, (440) 892-2266
True Connections, (800) 937-6217
