Finding alternative revenue streams is a necessity for business owners trying to weather the recession.

Kyle, Sarasota, Fla.
We’ve run a dinner theater for three decades, and make most of our money during the tourist season between Thanksgiving and Easter. The rest of the year our audience is local residents. We’ve been operating at a loss for the last couple of years, and are unable to get a bank loan. We own the land and the theater building, and have put them up for sale with no success. We even closed the theater for two months this summer to save money. We don’t know what to do.

By Coeli Carr, CNNMoney.com contributing writer
You're in a tough spot. A traditional lender won’t provide a loan to help you keep your business, and you can’t find a buyer to take it off your hands.

But there are upsides to your situation.

You own both the property and the building on it. Edward Indvik, a vice chairman in the investment services group of Lee & Associates in Los Angeles, suggests heading to your city’s planning department to find out the allowable uses of the building and property. Then look for ways to generate supplemental revenues from the space, especially during the non-peak season.

Some possibilities, says Indvik, are reaching out to companies that might be interested in using your space as a site for seminars or conferences. People might also consider getting married at the theater and hiring you to do the catering. Let the community know your site is open for other business, such as providing recital or practice space for other budding artists.

Joel Shulman, assistant professor of entrepreneurship at Babson College and an entrepreneurial finance expert, concedes that such measures will probably take you out of your comfort zone. But injecting fresh blood and ideas into your operation is essential. Invite local business leaders you respect in for a brainstorming session, enlist their expertise and partner up, he advises. “An alternative business model is something you must consider given the current economic market,” he says.

A partner who creates a complementary business on the premises could pay rent and give you a percentage of the take, says Shulman. Such a person could also act as agent and bring you clients who could use the space during non-peak season or during the day.

Another approach, says Shulman, is to do simple market research by asking local residents on your subscriber list what would inspire them to attend performances more frequently. Perhaps, he says, patrons would prefer to see only the show and would rather dine elsewhere. “It’s easy to lose money on a food business,” says Shulman, who cites spoilage, theft and labor costs as problematic issues.

If you eliminate the dinner, you might be able to raise the price of the theater ticket. By no longer serving a full dinner, you might attract a partner who’d want to set up a cafe or other type of eatery on your premises.

Increasing revenues in whatever way you can will make your business, even in a sluggish economy, attractive to potential buyers or lenders. With recent losses, your negative trend line is the worst thing to bring to a bank, says Shulman. However, non-traditional sources of loans are still available.

For instance, businesses that can't find bank loans can still apply online for loans from microfinance institutions like Accion USA. Premal Shah, president of Kiva, a global organization that helps people make loans to individuals in developing countries, also suggests visiting Prosper.com, a person-to-person lending site.

“It’s the eBay for loans,” he says. But first, try to boost your sales, he recommends. “It’s very attractive to a lender [if] you’ve found alternative revenue streams. It shows you’re a good entrepreneur.”

Give us your advice: Check out recent “Ask & Answer” questions.

Free cash for your business

Small business credit cards flourish as loans disappear

Rebooting your business model

Even in a recession, savvy retailers can boost their business.

The Flower Lady, Suwanee, Ga.
How does a florist sell more in this economy? We changed our business to designing weddings and events only, as the everyday flowers are not selling. We had to throw out too much product at the end of the week — flowers are perishable!

By Coeli Carr, CNNMoney.com contributing writer
As budgets get tight, people are spending less on luxury items — which means retailers in that market also need to clamp down and mind the bottom line.

Flowers’ short shelf life mandates that you control buying and adhere to a strict formula, says Keith Riewe, owner of Bice’s Florist in Fort Worth, Texas. The industry standard rule is that the wholesale cost of your flowers should be one-third of what you sell them for, he says.

The moment you realize you’ve got product left over, it’s time to cut your orders, says Riewe. Although many florists pay less for flowers by using a standing order, it’s often more cost effective to customize your orders. You’ll pay a little more, but you won’t be throwing unsold flowers away. It’s better to run out than to have unsold product, he says. Some florists have hybrid ordering systems that consist of a smaller standing order, and a separate, supplemental order when necessary.

Another way to cut your expenses is to keep a detailed count of what goes into your bouquets.
“Designers love to overstuff an arrangement to make it look pretty,” says Riewe. “When that happens, you’re giving the customer way more than what they pay for.”

Louie Theofanis, owner of Major Wholesale Florist in New York’s flower district, suggests boosting your margins by filling out bouquets with less expensive but attractive blooms. “Presentation is always important,” he says. “It’s important that customers feel they’re going out of the store with an armful of flowers, and that they’re getting their money’s worth.” Greens have a longer shelf life, he adds.

But no matter how gorgeous your merchandise is, you need to get customers into your store. That’s why advertising and promotions are even more important in a sluggish economy. Riewe recently gave away 500 rose bouquets, featuring a dozen flowers in each. The only thing people had to do to get one was come to his shop and provide contact info. Along with the bouquets, recipients got a card prompting them to visit the shop's Web site. Remarkably, 298 out of the 500 people did so.

That's another way to boost business. “It’s imperative you become technically savvy,” says Riewe, adding that most flower shops, compared to other retailers, are lagging by five or six years. He suggests using point-of-sale software to collect information from those who send and receive your flowers. Using the data he collects, Riewe sends out "preferred customer" cards, which offer an opportunity to earn reward points and be notified by e-mail of special offers.

Riewe suggests that florists rely less on corporate clients and focus on consumers. If one big company’s account represents a large part of your business, your revenues will become too dependent on them. Expanding into weddings and events is a smart move because those orders are typically paid for up front.

Give us your advice: Check out recent “Ask & Answer” questions.

Turning customers into repeat buyers

Advertising vs. PR: What pays off?

Discounts and referrals: What works now

Sales don't just wander in your front door. Here's how to cultivate up a steady stream of shoppers.

Sanjay, Huntington, N.Y.
We have a retail shop of clothing and jewelry. I sit all day waiting for the customers. How can I utilize that time on my computer, and do something that will generate extra cash for my business?

By Dinah Eng, CNNMoney.com contributing writer
If you're not selling your products online, now is the time to start — and if you've already taken the e-commerce dive, you can use your down time to build sales-boosting buzz.

If you don’t already have a Web site for your store, you can ease in by selling on established sites like Amazon.com or eBay. If you have handmade items, try Etsy.com or ArtFire.com.

Whether you're selling on your own site or an outside one, a good next step is to compile an e-mail database of your customers. Realize, though, that technology alone is not going to sell your inventory.

Paul Schneider, owner of Twist

“Retail is all about relationships,” says Paul Schneider, owner of Twist, which started as an artists’ coop and now sells jewelry and art pieces through two stores in Portland and one in Seattle. “If you compile an e-mail database and use it to establish a line of communication, you’re three-quarters of the way to making a sale.”

If you have six customers a day, you could compile 36 names a week. The trick, of course, is getting people to give you their e-mail addresses.

“I try to make it fairly personal,” Schneider says. “'Would you mind if I got in touch with you when we have a special promotion for our e-mail friends only?' Make it a private, exclusive club. Don’t send more than one mass e-mail a month. To a small retail business, this is gold.”

Schneider says he uses his Web site for personalized pitches, sending customers links to pages with items that may interest them.

To attract new customers, he suggests finding the blogs and discussion groups online that deal with what you sell, and becoming a part of the discussion.

“Talk about your products, even if you don’t have your own Web site,” he says. “If you sell wedding rings, get on the bridal blogs. We’re starting to work with social networking, and have a fan page on Facebook now. There are search engine optimization consultants who can help you craft online ads.”

Richard Eiseman, Jr., owner of Eiseman Jewels in Dallas, a high-end boutique, is now in the process of inputting a mailing list compiled over 40-plus years into a database. To entice people to register online, he sent out direct mail pieces offering a free valet parking pass at the mall and a chance to win a $5,000 store gift card.

“Find ways to get exposure by doing something unique," Eiseman suggests. "Host a charity event in your store. Have the local school sell something at your store. You have to get foot traffic in based on some expectation other than buying.”

Utilize that time in between walk-ins by reaching out to customers on the phone.

“Keep a card on every person you’ve sold to,” advises Scott Marshall, a Los Angeles consultant who specializes in retail management and e-commerce. “Write down what they like, their family information, anything you can think of. Then think of how to help them with the products you carry. If you’ve got trendy teen clothing coming in, and their card says they have teenage nieces, call and tell them, but do it in a way that shows you’re interested in them, and not just the sale.”

Marshall says men, in particular, always need help with finding the right gift for women. Have their spouse or girlfriend fill out a store “wish list,” then offer to send the guys an e-mail reminder when a birthday, anniversary, or holiday is coming up — and suggest items that the women in their lives might enjoy.

“You have to decide to be in the game,” he says. “Too many people think 'I’m a small store, my customers don’t have a lot of money.' Everybody wants to find a deal without searching high and low for it. To somebody, your things are expensive, and to somebody else, the items are cheap. If you’re ready to just sit at the computer and do work for someone else, you’ve given up on your own store.”

Give us your advice: Check out recent “Ask & Answer” questions.

Pay for the marketing that works

Even bad reviews boost sales

HR by Twitter

A guide to breaking big in Apple's very crowded market.

Keeven Kuate Konga, Tempe
What steps do I take in order to make a big jump in the iPhone application industry? I have found an app designer. I know the basics, but is there any other information other than what's given on Apple's Web site?

By Kathleen Ryan O'Connor, CNNMoney.com contributor

Imagine being crowned the valedictorian of a class of 50,000. That's a bit of what's it's like to capture the #1 spot in Apple's iPhone app store — only a lot more lucrative. A hot iPhone app is the Holy Grail of mobile software development.

For all the dings Apple takes for its dealings with outside developers, the price of admission into its iPhone app program is pretty straightforward: $99 for basic access to the software development kit (SDK). Apple ditched its wildly unpopular nondisclosure requirement back in October.

Once your application is ready for launch, the approval process generally moves fast. According to Simon Pope, an Apple spokesman, 98% of iPhone apps submitted to the store are reviewed in seven days, and 96% are approved.

Then comes the hard part: Getting noticed by legions of passionate iPhone users. Competitive pressure has driven the cost of most of Apple's almost 50,000 iPhone apps to $1.99 or less, according to 148Apps.biz, an independent site about iPhone apps with a good "marketing 101" section. That means volume is king. For your app to make money, customers must find it, like it, and above all, download it.

"It takes making a great game, but that’s just one element of it," says Adam Sussman, vice president of worldwide publishing for EA Mobile, which created top app The Sims 3. The mobile version of the popular game zoomed to #1 within 18 hours of its release on June 2.

"And we did that at $9.99," Sussman says.

Jumping off a wildly popular and established brand helps enormously, but Sussman says marketing is a factor, no matter your size.

"The app store is so crowded," he says. "How do you drive discoverability? It’s not the case that you just do a game and that’s it." EA's strategy was to build excitement for The Sims 3 by releasing all its platform versions — PC, Mac, iPhone and more — on the same day across the world.

One way to get noticed on a shoestring budget is to try to have your app reviewed by some of the dozens of sites that have sprung up to chronicle All Things iPhone, like AppScout. The blog Online Marketing Rant has a handy list of relevant publications.

And while the unfortunate Baby Shaker app produced a lot of press, no expert thought silly or scandalous was the way to go. The best apps leverage unique iPhone features, like the device's accelerometer and touch screen. A rich and addictive user experience is the difference between being a one-hit wonder or creating something with staying power, Sussman says.

Also critical is knowing your audience, says Jonathan Sasse, senior vice president of marketing at Slacker Radio, a popular free online radio station that released its own iPhone app in January.

"We did our best to make sure the iPhone experience is close to the full Slacker experience, so you can go back and forth," he says. Slacker went for a rich-media feel, but developers need to be mindful to keep their mobile apps from growing too complicated.

Try not to get caught up in the frenzy to be #1, Sasse recommends. Concentrate on building a great experience.
Mark Bradshaw, director of development for Stratogon Entertainment Corp. in Plantation, Fla., knows what it's like to be in your shoes. Stratogon now concentrates heavily on the iPhone app market, and will have several apps ready to go live in the next month.

"We think it’s about making a great game that's really quick and fun," he says. "People are going to be sitting at the bus stop — it's something they get in and out of pretty quickly."

So how big a deal will it be if your apps break big?

“It’s a huge deal,” Bradshaw says, especially for those on tiny budgets.

A bestselling iPhone app can easily move 300,000 units in the first three months. At $1.99 per unit, that's almost $600,000. Apple takes a 30% cut, but when you're creating your product on a shoestring upfront investment, that's still a lot of upside. As Bradshaw puts it: grossing "half a million dollars isn't bad."

Give us your advice: Check out recent “Ask & Answer” questions.

iPhone U: Learn how to code

The iPhone music maker: How Ocarina scored a hit

How to get your video game into retail stores

Finding buyers when sales are sluggish

A research study of the quintessential business dilemma has turned up some surprising answers.

Max Smith, Miami
I run a small company, and the recession is making me re-examine my advertising budget. I ran across claims that publicity may be much more cost-effective than advertising, but found no formal studies on it. I always thought PR was too expensive for small businesses, but in doing my research I posted my project on AllPublicists and got many low-cost offers from publicists. One firm, for example, doesn't charge anything unless they deliver results. However, most companies still put much more reliance on advertising than on PR. Is it because pay-for-results-only publicity such a new option, or am I missing something? Are there any studies on the subject?

By Kathleen Ryan O'Connor, CNNMoney.com contributor

Considering all the time and energy that has gone into pitching everything from snake oil to fabric softener, you would think someone would have answered the age-old question by now: What's better, advertising or public relations?

"It's a little bit of a complex question, actually," says David Michaelson, president of Echo Research and a leader in communications research. "The answer is, it depends on what you want to achieve. Advertising and PR have decidedly different benefits, and each contributes differently to your communication goals."

Michaelson and research partner Don Stacks, a public relations professor at the University of Miami, tackled this dilemma in a major study that began in 2004. So far, they've found was little difference in the results from advertising and PR, contrary to that conventional wisdom that public relations — ie, "free" publicity — is always better.

To conduct their research, Michaelson and Stacks had to find a scientifically rigorous way to measure each approach. They created the fictitious product "ZipChips." The snack was perfect. "It had no sodium, no calories, no fat, tasted great," Michaelson says. "What's not to like?"

They created a fake story about the chips in a mock-up of The New York Times, and also made a fake advertisement. Then they quizzed mall shoppers on their impressions.

"They tended to perform pretty much the same," Michaelson says. "At every single point of measure, when you found out about the very basic level of awareness and intent of purchase, there wasn't a lot of difference between the two."

There were a few areas of divergence. When it came to communicating depth of information, public relations was more effective. Ditto for the "relationship" between a product and person, and for inspiring thoughts about how it might fit into their lifestyle. But with advertising, the message was much easier to control. With PR, you not only can't guarantee placement, you have little say in what comes out on the other end.

So the researchers found that the simple answer is "there is no simple answer," Michaelson says. When you are dealing with choice between PR and advertising, the answer isn't one or the other, it's both.

Veteran publicist Michelle Tennant Nicholson agrees, and notes that effective doesn't have to mean expensive.

There's an old adage in the business, she says: "You pay for advertising and you pray for PR."
Rubbish. "It couldn’t be further from the truth, and a lot of small business owners are confused," says Nicholson, co-founder and co-owner of Wasabi Publicity in Asheville, N.C.

In her view, advertising generates sales while PR boosts your business's visibility and credibility. "PR is one element of many other aspects," she says. "I think people are getting a disservice if they're told, 'don't use advertising' or 'just use PR.'"

So can you drum up good publicity when every penny counts? The concept of paying only for results in public relations is not new, though delivering service exclusively over the Web is somewhat novel. But Nicholson says small business owners can do a lot to garner positive press for the best price of all: free.

Free sites such as PitchRate.com, which Nicholson helped found, and Help A Reporter Out narrow the gulf between you and the media. If you have an area of expertise or compelling personal story behind your business, sign up on those sites and put your shingle out. If it's relevant to a reporter or producer, they will contact you. And it's not just free until a story happens– it's completely free.

Give us your advice: Check out recent “Ask & Answer” questions.

‘I started a biz – and now it’s failing’

When ‘free’ doesn’t pay off

Finding the best customers for your business

How to stand out in a crowded field without spending loads of money on advertising.

Jenny, Deer Park, N.Y.
I own a small beauty shop in a mid-sized town on Long Island, New York. The problem for me is the competition: In the past five years, three more beauty shops opened around the five-mile area, and my business started to sink two years ago. How do I stand out from a crowded field without spending tons of money on advertising?

By Lenora Chu, CNNMoney.com contributor
Start off by giving some serious thought to what really differentiates you from the competition.

Develop an “elevator speech,” says Willis Turner of the Richmond, Va.-based marketing consulting firm Huntsinger & Jeffer. That’s a 30-second answer to the question, “Why should I come to your shop instead of your competitors?”

Do you have highly trained stylists with more experience? Do you specialize in certain types of service? Are you better on service details like remembering names and birthdays?

Once you’ve identified a few key points, Turner says, focus on them again and again with your customers.

“Repetition is the key to success,” Turner says. “Remember, just when you start to get tired of your message, that’s when your customers and prospects are really beginning to notice it.”

The goal is to jumpstart a word-of-mouth campaign. No form of advertising is more effective, so make sure every client leaves your shop with a reason to tell her friends how great you are, Turner says.

Then give your customers an incentive to keep coming back — and to refer their friends.

For example, you could offer a referral program and print special discount cards for clients to give to acquaintances. Both the new customer and the referring client would be eligible for the discount.
You could also borrow tried-and-true methods of inspiring customer loyalty from other service industries, suggests Steve Winston, a South Florida marketing and communications consultant.

Start a frequent-visitor rewards system, much like the airlines’ frequent flyer programs, suggests Winston. Customers can earn a set number of points for each treatment, then win free services when they reach a certain threshold.

Like restaurants, you could post daily or weekly specials on a blackboard in the window to draw in traffic.

Or you could distribute discount coupons in your local area, like many home furnishings stores or take-out restaurants do. Try hand-delivering coupons to a targeted group of people, Winston says, such as teachers at a nearby school.

Lastly, make sure you have a brochure that lists your services and your strong points relative to your competitors.

It may cost a little money to produce, Winston says, but if done right, it will stand as a record of what makes you different in a crowded field.

Give us your advice: Check out recent “Ask & Answer” questions.

‘I started a biz – and now it’s failing’

When 'free' doesn't pay off

Finding the best customers for your business

Have a hot idea for an educational software product? Here's how successful entrepreneurs have cracked the market.

Ernest L. Leisner, Buffalo
I have created a word game that I would like to transform into an educational video game. I believe it can go a long way to help improve the dismal illiteracy rate in our schools. I have many aspects of a proposal in place and I’d like to find a government grant to help. I have tried searching the Internet, but there are scams all over the place.

By Kathleen Ryan O’Connor, CNNMoney.com contributor
Finding a grant to develop a business idea is nearly impossible. Scams abound, and legitimate grants from foundations and other philanthropic groups are almost exclusively for non-profit groups or educators, not private inventors. The only genuine place to search for U.S. government grants is grants.gov, but those rarely go to sole proprietors. (See "Business grants: Sorting out the scams.")

But there are still ways for a novice with a great idea to crack the educational software market. The first step is to get your product or proposal in front of people who know the market and can help you sell it.

There are two options: Create, publish and market the software yourself, focusing on either the retail or education market, or license the product to an established company.

Entrepreneur Margaret Johnson chose the do-it-yourself route for ItzaBitza, a computer game that helps kids learn to read through interactive art.

Johnson knew plenty about kids and software: She's a mother and spent nearly two decades at Microsoft. But what she didn't know was retail, which turned out to be the name of the game.

"For an entrepreneur, retail is tough. You are sitting on inventory … it takes a while to ramp up awareness," says Johnson, who left Microsoft to sell ItzaBitza through her educational games firm Sabi Inc. "Awareness is huge. That's tough for a little guy to get."

First, make a list of all the publishers in the educational game space – Johnson mentioned Microsoft (MSFT), Sesame Street and Nickelodeon, but look on the shelves at your local Best Buy or a similar store for more ideas. Then, make it a point to attend their conferences or find them at trade events. You won't need an appointment, but this is where shyness is not allowed.

"I basically stalked people," Johnson says with a laugh. She'd sometimes wait as long as two hours to talk with the right person. "I showed them the game right there." Johnson ultimately made the decision to self-publish – a riskier move, but a more profitable one if you are successful.

If you self-publish, the next step is to get your game into stores. That requires making contact with buyers. At small, local stores, you can approach owners directly, but if you want to crack a national chain, they won't usually field calls from unknown businesses. They work with major retail distributors – who also prefer to deal with larger companies with established sales histories.

Johnson had little luck approaching major distributors abut ItzaBitza, but from them she was able to get the names of several reputable distribution aggregators. Aggregators are companies that take on several smaller clients. Johnson used Channel Sources Distribution Co. of Brookfield, Conn, but there are plenty more out there.

Distributors will take care of logistics and paperwork for you, but their biggest asset is their network. "They have a sales force, and they call on Toys R Us," Johnson says.

ItzaBitza is now available on retail shelves in stores including Best Buy (BBY) and Office Max (OMX).

Despite the recession, the educational software market is poised for growth. Educators staring out at classrooms filled with kids raised on Nintendo and Xbox are more open than ever to incorporating software and video games into their curriculum.

John Rice, an educator specializing in instructional gaming who writes a blog devoted to the industry, points to games that started as purely entertainment that have been repurposed for educational use. The Civilization series, for example, has been adopted by teachers for sociology and history courses.

"Likewise, The Sims can be used as a language-acquisition tool when students play it in another language," Rice says.

That opens the door for direct sales to schools and other educators. Like the retail channel, though, that market has its own challenges and quirks.

"Education, as a market, is extremely homogenous – [schools are] structured roughly the same, with the same purpose – which is good from a business point of view," says Mark Jones, president of Echo 360, which offers technology for recording lectures. Jones describes his product as "TiVo for the classroom."

He recommends you find the early adopters or "visionaries" among educators or education institutions. Is there a school that consistently seems to be in the forefront of new technology? They might be more receptive to a pitch than a place still in love with the chalkboard.

If you can get them on board, "they will become a viral network for you," he says. Education is a very peer-driven field; administrators often rely on colleagues at other departments or schools for product recommendations.

If you're really strapped for the up-front capital to create your product, licensing could offer you the most bang for minimal bucks.

"Think about what kid brand is out there with established credibility and pitch the game as an extension of that brand," suggests Andrew Mininger, CEO of Mada Design, a New York-marketing firm that works with clients in the games, education and licensing arena.

The best and fastest way to reach representatives of major brands is through expositions like the International Licensing Industry Merchandisers’ Association's annual conference. This year, it's set for June 2-4 in Las Vegas. You'll have to pay for a ticket to the show, but it's open to anyone. Prices range from $180 for a basic floor ticket to a full package for $1,170 that will allow you to attend seminars such as "Basic Training for First-Time Licensees" and "Getting Your Brand Ready for Licensing."

Before you approach someone, do your homework. Have a pitch ready about exactly how your game can extend their brand. Do they already have educational books on the market? A software component could be a natural extension. Are they lacking an educational tie-in their competitors already offer? That's also an excellent way to get attention.

You might also want to take a look at developing the game for a particular platform like the Nintendo Wii or Sony's PlayStation Portable. "Everyone is trying to get more exclusive, like Microsoft with Xbox," Mininger says. Everyone wants to make their product the hottest one around, and "education is integrated into that experience."

Give us your advice: Check out recent “Ask & Answer” questions.

How to get your product on retailers’ shelves

When to pay for an advertising campaign

What fair use protects – and doesn’t

Our experts try to jump-start a struggling auto services venture.

Eddie Freeman II, Lube N Go Michigan!, Mich.
I started a mobile oil change business. We change your vehicle's oil at your location, work or home, for $24.95. I am having trouble launching the business – the phone is just not ringing, and I am having no luck with fleet businesses. I've tried word-of-mouth marketing and handing out fliers. I started the business with my own money when gas was $4 a gallon to save customers money and time. Everyone thinks the idea is great, but no one is using it. I quit my job as a dealership service manager to start this business. What advice do you have to get it going?

By Emily Maltby, CNNMoney.com writer
There are a lot of things working against your business right now, both in and out of your control. First is the economy. People are putting off expenses that aren't imperative, and they may wait an extra couple thousand miles before spending money on an oil change.

"Nationwide, the majority of shops are experiencing a downturn," says David Rogers, president of Auto Profit Masters, an advisory firm for auto service shops, and COO of repair shop Keller Brothers Auto in Littleton, Colo. "I've seen many have to take measures like opening extra days and staying open at night, but it's not working."

Another other issue is your competition. You're up against not only mom-and-pop establishments and service gas stations, but the JiffyLube and Midas chains as well.

"It's a cutthroat market, where people are offering the cheapest of cheap, $10 to $14," Rogers says. "Even on Craigslist, there are no-name people who will do your oil change to earn a few extra bucks."

But the main problem you should focus on right now is your business model.

"This concept has been tried before, but from what I've seen, most of them are suffering," says Rogers. "And it's because consumers are simply not comfortable with it. People are conditioned – they like the feeling of going to a brick-and-mortar shop. With your model, they think of a greasy guy jacking up their car in a parking lot and then they'll have to get it towed to a shop anyway. Or, if they're at work, you'll come in and interrupt what's going on. On the surface, it seems pretty sketchy, so it'll be a long road to overcome that image."

To start turning that around, marketing is vital.

"When you have a product that's unlike any other, people have no trust," says Jim Lanzalotto, president of marketing firm Scanlon.Louis in Newton Square, Penn. "The trick is to show them why they can't live without this service, and the best way to do that is to offer free trials. That will get the relationships established, and you'll also start to get feedback."

But you don't want to just give away free services randomly. The key is to focus on the gatekeepers of word-of-mouth advertising. For instance, offer free trial services to your local radio announcers or writers from your hometown newspaper. If they like the service and talk about it, your name will spread faster.

To help your marketing, make sure your name says it all, so that people understand what you are all about the instant they hear your company's name. "Your name is a value proposition," says Lanzalotto. "'Lube 'n Go' – does that mean 'I drive to you?' It's not clear."

Also reevaluate who your target customers are and how you can access those customers. Instead of trying to focus on individual employees at companies, Lanzalotto suggests arranging a deal with the HR managers of those companies. See if you can get a coupon program going for the whole office.

Also, one great place to find car owners is gas stations. Try to partner with fuel stations that don't have their own service center. You can organize a referral or revenue-share deal with them to boost their incentive to tout your business.

Polishing your image can also pay off. "You have to come off square – you have to scream professionalism, from the uniforms to the truck you drive," Rogers says.

Your truck should be lettered and decorated with your logo so that people who drive by can see what you are doing. "It's a staging area," Lanzalotto says. "Put out banners and signs when you do your work, something like, 'Another oil change by Eddie Freeman.'"

And, tough as it is to put entrepreneurial dreams on hold, you'll also need to think about an exit strategy. When consumers aren't spending, even strong businesses can face insurmountable obstacles.

"This is not the greatest time to launch this type of business, particularly if you don't have a lot of experience," Rogers says. "This is the time to study and find help. I'd say you need two years of operating expenses and marketing and advertising expenses to make it through."

Give us your advice: Check out recent “Ask & Answer” questions.

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Some clients aren't worth the headaches. Advance vetting and precautions can spare you the pain.

Chris Walker, Phoenix

I started a concierge service on a tight budget. I am not looking to conquer the world in a day. I would like to attract the "right" customer and grow the business within my means. What would be the best methods to find that "right" customer?

By Kathleen Ryan O'Connor, CNNMoney.com contributor

For an entrepreneur just starting out, it's tempting to taken on any client willing to promise cold, hard cash in exchange for your services. But the seasoned small business owners we spoke with all say the same thing: Do all the due diligence you feel is necessary for your particular business – credit checks, background checks, reference requests – but never forget the most important check of all, your instincts.

"Twice during the past year, I've signed clients about whom I felt uneasy," says Steve Winston, who runs a marketing and communications firm in South Florida. "And both times, I should have listened to my gut feeling."

One client was unable to communicate what he wanted from a marketing campaign and frequently left Winston waiting for an hour or more at appointments. "Yet, because of fears of about the economy, I took them on," Winston says. In the end, they parted ways.

The client never paid for the initial work completed. "I wrote it off as bad debt and lessons learned," Winston says.

If you want to formally vet potential clients, you have a few options. A Google search is an easy first step for finding out more about an individual or a business. If your potential client is a company, you can go to the Better Business Bureau's Web site and check to see if complaints have been filed against the company, and if so, how they've been resolved. A Dun & Bradstreet background check is commonly deployed for vetting. The most extensive report will give you a complete snapshot of the business: who owns it, how long they've been in operation, how often they pay late, details on any court judgments or liens, and even a recommendation about how much credit to extend.

You can also ask for references and check them by calling others with whom your potential client does business. What's been their experience? Did they get paid on time?

Consider joining a trade group to swap ideas and advice with fellow concierges working outside your geographic area – i.e., those who aren't direct competitors. The National Concierge Association is a good starting point for your industry.

And because the best defense is a good offense, it's critical to have a contract that spells out all the details. Unless you've comfortable drafting one yourself, it's worth paying an attorney to help you create a basic template contract you can use on all of your future engagements.

One excellent and often overlooked way to guard against deadbeat clients is to require that at least a portion of your fee be paid up-front.

"'Will they pay me, and will they pay me on time?'" are the key questions every business owner needs to ask about potential customers, says Dave Richards, who has run niche marketing firm Resort & Golf since 1990 in Bloomfield Hills, Mich.

"It sounds simple, but so important, especially now," he says. "I'd rather have one client that pays than three that don't."

Before accepting a new client, Richards calls his contacts within the business and checks with the potential client's suppliers. For a golf course, he'll go all the way to the company that sells them fertilizer or mows their grass to find out how timely the company is with its bill payments.

You're in a business where you'll have to spend a lot of time catering to a client's needs and wants, so it's essential to make sure you're personally comfortable with potential customers. All the legal vetting and paperwork in the world won't be as valuable as your initial impressions.

"Intuition is a real big part of this," says Ellen Delap, a Houston-based professional organizer.

Pay attention to the client's motivation, and whether it fits your business goals. Are they looking for the cheapest service, or are they looking for the best?

"We are always leery of working with a prospect whose sole motivation is saving money, because if they buy on price then they will leave you on price," says Lauren Brenner, president of the HR division of HCR Group, an HR and benefits consulting firm in Waltham, Mass. "We are looking to build an on-going relationship with our clients."

One final bit of advice: "Don't be desperate," says marketing specialist Winston. "You cannot be desperate, recession or not. Those kinds of clients pay you the least money and give you the most headaches."

Give us your advice: Check out recent “Ask & Answer” questions.

Related links:

Help! My client won't pay!

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Offering a product too cheaply can devalue it for customers. Here's how to zoom in on the right price point.

Emil G., Santa Monica
Is making a service free more counterproductive then selling the same service at a low cost? We recently put together a highly defined service in which we analyze the conversion rates of Web sites and make strategic suggestions – which we were already doing, it just wasn't separated out into its own service like it is now. Our plan was to begin offering it for free initially while we worked out the kinks, but since dropping the price to zero, it seems we've stripped the value in our clients' eyes. I expected the opposite. Any suggestions?

By Kathleen Ryan O’Connor, CNNMoney.com contributing writer

The concept of "no free lunch" is so ingrained in the business culture, you can’t really blame customers for looking askance at a free service. After all, if it’s so great, why aren’t you charging for it?

“Pricing is a part art and part science, and how you price a service will have a massive influence over what people perceive the value of your service to be,” says Mike McDerment, CEO and founder of FreshBooks, an online invoicing service that uses a “freemium” business model. FreshBooks' basic products are offered for free, but customers are charged for advanced or premium features.

“From the start, you need to set your clients’ expectations that the service is in fact worth paying for,” McDerment says. “If they have used it for free or with limited capabilities, then they should understand the value of the service and therefore be willing to pay. If they are not willing to pay after trying the service, then they never would have paid.”

He suggests that your first step going forward should be to tell your clients that you will soon start charging for the service. You can set expectations: Tell them the new rates will take effect in 30 or 60 days, or will kick in after they cross a designated usage threshold. “Step two, start charging them," McDerment says.

The pricing issue isn’t unique to the Web, says Mary Wolfinbarger, a professor of marketing at California State University Long Beach.

“When consumers don’t know how to value a product, price becomes a signal for the value of the product,” she says. “Digital products are in a class of products that consumers may find difficult to determine the value for.”

Haroon Mokhtarzada, CEO of the social media and Web hosting company Webs.com, has firsthand experience with the value of perceived premiums. Like FreshBooks, Webs.com uses a "freemium" model, but it recently changed its name from Freewebs.

For your service, conversion-rate analysis could be part of what you offer for free, but given its importance these days, you should make the service's value clear by holding back some of your insights. For instance, you could offer just one or two suggestions from a battery of 10, and let customers try out your tips to see the results, Mokhtarzada suggests.

“The whole game on the Internet is to improve those flows and that’s what every company is looking to do,” he says.

So is any damage permanent?

Nope, our experts say. Peter Boritz, president of Real Data Management, a New York City technology and consulting firm, recommends recasting your free offering as a limited beta test, open to clients you trust to help you incubate your ideas.

“Consider them to be part of a pilot,” he says. “Get feedback and testimonials.”

“Most of their potential clients haven’t heard of them yet," Mokhtarzada says. "That’s the great advantage of the Internet. You have a new release, a new push. With the Internet, you just change it the next day and it’s different.”

Give us your advice: Check out recent “Ask & Answer” questions.

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How to boost your business when sales are slow

A good distributor can make or break your product line. Here's how to find the right one.

Deziree Williams, Sugar Free Baby, Los Angeles
I have a children's eco-friendly clothing line. We are taking it slow because we are branding our line and are in some ways picky about who we sell to. I have recently been approached by a distributor, but I'm not sure if this is the best way to launch into the market. Any advice?

By Emily Maltby, CNNMoney.com writer

By the look of your Web site, SugarFreeBaby.com, it seems you are off to a great start. You've evidently taken the right steps to approach the smaller retailers already, as your line is already in a number of stores.

You are wise to be conservative about which storefronts represent your line. But as you expand, part of your decision about working with a distributor will depend on whether you want to stick to the small stores or get to the national chains. You can continue to go it alone if you stick to the smaller outlets, but a distributor is essential if you want to reach out to the big guys.

"Large retailers want to see someone in the buyer's office that they already has a relationship with – someone who knows the system," says Gordon Cundell, a former assistant buyer with Sears Canada and current president of the Canadian Sporting Goods Association, an information service for sports equipment and apparel buyers and sellers.

Working with a distributor could be a smart move even if you want to indie shops. "Suppliers often have the passion needed for a successful product, but no business sense to get the product in to the right places," Cundell says. "Chances are the average clothing designer doesn't even know all the distribution channels that are available."

And of course, even if you have the knowledge to do the job, you may be stretching yourself too thin by taking on the daily activities of a distributor.

"One benefit of using a distributor is that ideally you have one place to ship your goods to. They break it out and do all the individual shipping and selling for you," says Rob Reger, president of Cosmic Debris and creator of the gothic Emily the Strange product line, which is sold internationally, in 200 independent boutique stores, and in large chains such as Hot Topic and Borders. "This leaves you with designing and manufacturing, keeping the quality control in your hands."

If you decide to work with a distributor, picking the right one is critical. What should you be looking for?

Both Reger and Cundell say your distributor's vision is crucial to a successful relationship. You need a partner who fully understands what type of customer you're targeting, and who has ties to retailers that serve your market.

"Taking it slow and building your brand with a specific core customer in mind is wise," Reger advises.

"Find out what they already distribute," Cundell says. The other lines they represent should be similar but not exactly the same as yours.

You'll want to find children's clothing distributors who don't currently have green attire in their lineup – if the distributor already has eco-friendly offerings, "you risk the lines competing with each other," Cundell says.

Give us your advice: Check out recent “Ask & Answer” questions.

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If you want to reach a national audience through the home-shopping networks, you'll need mass-manufacturing capabilities and a catchy storyline.

Mona Kahn, Salt Lake City
I am a jewelry designer and I want to present my merchandise to a larger audience. How do I get my products on ShopNBC, QVC or similar outlets?

By Christina Crapanzano, CNNMoney.com contributing writer
The application process is quick and painless. Both ShopNBC and QVC have applications available online for downloading, and both sites offer guidelines for product submissions. You'll need to send in digital photos of your product and answer questions about your manufacturing process and price point. The networks are looking for vendors who already have a product – they aren't interested in ideas, sketches or prototypes.

We asked the shows' vendor scouts to tell us a bit more about how they pick new products to feature.

QVC has more than 10,000 applicants each year, and also recruits vendors from trade shows or craft fairs. From that, only about 500 new vendors are introduced on-air each year.

"Don't be redundant," says Marilyn Montross, QVC's director of vendor relations. "The first thing we look at is the product. For jewelry, we're asking, 'is this something new and innovative versus products we're already selling?'"

The same philosophy holds true at ShopNBC. "The product is the star of the show," says Anthony Giombetti of ShopNBC's media relations department.

Watch the networks you are applying to and get to know their current products and vendors. That will also give you an idea of their target audience and your potential customers. For ShopNBC, the typical viewer is over the age of 45 and is affluent, with an average household income of more than $70,000. QVC says its customers are predominantly women, though its demographic changes hour-to-hour depending on programming.

Knowing your audience's tastes is only the first part of the battle. The next step for applicants is demonstrating a capability to produce in mass quantities.

"They have to have their ducks in order," says ShopNBC Chief Merchant Kris Kulesza. "If you can only make five to 10 units of something, that could close the door." ShopNBC, which broadcasts to more than 70 million homes, might ask vendors to have as many as 5,000 units available.

However, QVC's Montross warns against jumping the gun – never manufacture large quantities of your product on spec before getting approval from the network. They want to see that you are capable of manufacturing mass quantities, not that you've already done it.

The volume demand usually rules out hand-crafted items.

"In order to do both the volume and quality, [vendors] need to be working with a pretty sophisticated manufacturing factory," Montross says. In rare cases, networks might put vendors in touch with manufacturing companies, but they will not pay manufacturing costs.

"[Merchants] have to be willing to make an investment," Kulesza says. "Not everything will take off or sell out from the get-go. You may have to make an investment up front."

Something else the networks seek: A personality and a story to go along with the product. If you become a vendor, you will likely present your product yourself. You should be prepared with all the elements that go into making compelling TV, such as a good storyline with twists and turns. You'll want to have themes and variations in your product line that you can discuss.

Finally, don't be shy. Be able to talk enthusiastically about your product, both to the vendor scouts and also, potentially, on air.

Persistence is key: Kulesza says that if you submit an application and get no word back, "Don't be afraid to make the call directly to us."

Our Caribbean experts weigh in on which island is best for an expat's bar biz.

Edd, Philadelphia, Pa.
I'm interested in starting a bar or café somewhere in the Caribbean. I have around $400,000 in startup capital and 20 years of experience managing restaurants. I am trying to find the best and easiest island on which to start my business.

By Blake Ellis, Fortune Small Business contributor
We set out to find the best locales in the Caribbean for entrepreneurs, and found a wealth of options for you.

Nerissa Golden, an entrepreneur and host of the annual Caribbean Young Entrepreneurs Symposium says that if you're looking to make an investment of more than $100,000, the best option for you is to become a naturalized citizen before establishing a company, because being a citizen will make the process much easier. Some countries, such as Saint Kitts and Nevis, offer "investment programs" that allow foreigners to receive citizenship in return for an investment in local real estate.

The first step toward picking the right spot for your business is to visit various islands to see how their economy and culture suits you. Jim Beach, executive editor of InternationalEntrpreneurship.com, rattles off a number of features potential Caribbean expats should evaluate: "Do you like the rich, celebrity filled – and maybe a little snobby – St. Bart? Or the more relaxed St Lucia? Do you like arid places for scuba diving, like Bonaire? Do you want to live with mostly American tourists as customers in Jamaica, or Europeans in Curacao?"

To find the right place for your business, you need to select a spot where you fit in and feel at home. If your café doesn't fit in with the distinctive atmosphere of the community it's in, it won't be successful. Language is also a factor: If you don't know French, you'll want to avoid one of the French-speaking islands, such as Martinique or Guadeloupe.

That said, Beach believes Curacao is the easiest place to start a business, thanks to its low crime rates and strong government protections.

"Jimmy Buffet is currently looking for someone to buy a Margaritaville franchise in Curacao, but $400,000 might not be enough to get that up and running," he says. St. Lucia and the Turks and Caicos are the trendiest places, and "certainly 'the places to be' if you want to follow all the development."

Golden says that St. Kitts, Anguilla, Antigua and St. Maarten are also good options. "They are experiencing a surge in foreign investors, and are very attractive to high-end tourists as well as other vacation travelers," she says.

However, given the size of your startup capital, Beach thinks you might want to look outside the Caribbean at a less developed area instead. He cites Costa Rica as a hot spot for entrepreneurs with modest capitals.

Michael Stamler, a spokesman for the Small Business Administration, suggests looking at the World Bank's latest "Doing Business In" report, which examines the ease of starting a business in countries all over the world. Puerto Rico ranks in the top 10 countries globally for making it easy for entrepreneurs to get off the ground: registration paperwork is quick and inexpensive. Jamaica is also a standout for startup efficiency – and none of the countries in the Caribbean have minimum capital investment requirements except Haiti.

Once you select an area, Golden advises you to contact a notary or a trust company to apply for a business license and permit of residency. That process takes between three months and a year, she says.

As you create a business plan, remember Golden's advice: "Food and parties go together in the Caribbean, so some of your capital needs to be spent on having regular nights of live music or popular DJs or international acts."

Another recommendation: "When it comes to marketing, research what is most effective on each island, because some islands are more radio-driven, so spending money on print advertising is not the best use of cash. On others with a heavy newspaper readership, print ads get you more bang for your buck."

Give us your advice: Check out recent “Ask & Answer” questions.

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Getting your products on the market is a first step, but getting them in front of the right potential buyers is essential.

Callixte Matala, Mac-uisine, Montreal
A year ago, I started a high-end, stainless-steel kitchen sink distribution company in Montreal. I've recently added bathroom sinks and bathtubs to the line. The sinks are very high end, made of marble and granite, ranging from $600 to $2,500. Cabinet makers and kitchen designers spotlight them, but I'm still having a hard time selling my sinks. I'm trying to target those who are remodeling their kitchens. What should I do?

By Emily Maltby, Fortune Small Business staff writer
Dear Callixte: You are going in the right direction by working with resellers rather than going it alone.

If you have a retail location, you can set up events to expose yourself to builders and home associations. "You could buy some wine and cheese and host meetings or networking ," says Randye Spina, chief solutions officer of Affordable Marketing Solutions in Bridgeport, Conn. If you don't have your own store, work with the retailers who display your goods – you can probably arrange to run networking events in their stores to show off your sinks.

Spina recommends joining an association called the Society Of Certified Kitchen Designers in order to get to know architects and designers who could use your wares. And because it's so important to network with those in the industry, you should seek out trade shows. The granddaddy of trade shows is the International Home & Housewares Show in Chicago, which will be held in March 2009, but smaller kitchen expos take place in other locations throughout the year.

"Even if you don't have enough money to set up a table at these places, go as an attendee and walk the floors to make appointments with designers and hand out brochures," Spinya suggests.

Giving sinks away can help get your name out there. Spinya recommends contacting HGTV shows that focus on remodeling to see if you can contribute a product to one of their episodes. The host of the show can talk about why your sink works in the remodeled kitchen, and your company may be listed in the credits of the show.

If you are working on a shoestring budget, try to work also with the manufacturers to help you sell their product. "It behooves them to give you money to sell the product," Spinya says. "Ask the manufacturers for collateral materials to produce marketing materials. Tell them you need their assistance to produce banners, postcards and brochures and they should chip in. Take that a step further and split the cost of a radio ad."

Also, a Web presence is essential. "A Web site is the equivalent of a business card," Spinya says. "Even if it's just a beautiful home page with your contact information, it's essential." If you don't have your own retail store, a Web site is a good way to show off your sinks and direct potential buyers to shops carrying them.

In the meantime, since you don't have a Web presence, try to get your phone number listed in online directories. Gregg Stewart, senior vice-president of TMP Directional Marketing, a search engine marketing agency in New York City, says when there is a lot of money on the line, the buyer will want to see the product and have contact with a human before making a purchase.

"In your industry, 85% of purchases are made within 15 miles of the home. People want local solutions because the product is high-end and may have installation issues," Stewart says. "E-business is good for CDs and books, but for expensive home improvement, the consumer wants to see it before investing money."

Rising above higher commodity costs is challenging, but savvy owners can stay strong by adjusting to changing conditions.

Ahmad bin Saripan
I manage a food-processing business, and our sales are declining as costs and the price of raw materials escalate. How can I improve and grow the business?

By Herman Wong, Fortune Small Business contributor
Dear Ahmad: Making and selling a simple cookie isn’t as easy as it used to be. The rising costs of energy and ingredients challenge the recipe for success in the food industry – just as consumers cut back on their spending. Fighting against this inflationary tide takes smart cost-cutting.

“What you don’t want do is to start willy-nilly cutting costs. Be strategic about it,” says Bob Goldin, executive vice president of Technomic, a food industry consulting firm.

Fat to trim can come from the traditional places like headcount and company inefficiencies, but sourcing presents another good opportunity. Take a hard look at your production process. Can you replace any expensive ingredients with cheaper options that won’t affect the product? Outsource your manufacturing if possible and prudent, and do some research to see if you can find new suppliers with better prices. Also consider amending your contracts with suppliers: for example, offer to extend the contract length in exchange for lower prices.

But a business can’t cut its way to prosperity. It must also enhance revenue. Goldin suggests optimizing the price you charge (possibly by passing higher costs along to consumers) while also attempting to increase sales volume. Promotional activities can be a good investment: A sales slump can be a catalyst for more effective marketing.

Seek out new niches or channels to pump up sales. For a retailer, this could mean looking into specialty food stores or food services. Companies dealing in fresh foods could research expanding into the frozen arena. “You really have to explore the gamut,” Goldin says.

Looking deeper

Reacting to price increases may only be addressing surface symptoms, however, says Eric Flamholtz, professor of management at UCLA's Anderson School of Management.

“It’s not just the question of 'Costs are going up, how do I handle this? Do I negotiate a little better?' That’s only going to be a transactional perspective, as opposed to a management perspective,” Flamholtz says.

He suggests looking at the big picture – the current environment, your competition and industry trends – and then figuring out something unique about your business to build on. For example, Bell Carter Olive Company became a dominant player in the black olive industry by focusing on being a low-cost producer, which required a reassessment of both its business operations and its raw material purchases.

Once you've decided on a course, evaluate all aspects of your operations and determine how well they meet your company goals. That means taking a hard look at your market position, the services you offer, your operational and management systems, and even your company culture.

“What he really has to do is to step back from the immediate problem, take a more fundamental look at his business, and do a strategic assessment,” Flamholtz says.

Adjusting your business model

Judith Moore of Charleston Cookie Company has been battling cost increases all year. Her five-year old South Carolina company, which does around $1 million in annual sales, has seen the price of a 50-pound sack of brown sugar rise from $19.95 before Christmas 2007 to $26.95. Flour is up 25%, as is the European chocolate that gets folded into Moore’s double-fudge chip brownies and white-chocolate pistachio cookies. The falling dollar made importing from Europe a pricey proposition, so Moore is looking for a less expensive domestic chocolate producer that can provide the same level of quality.

She is also taking advantage of her growing wholesale business, which accounted for 40% of total sales in the past but will reach 50% by the end of 2008. Moore is leveraging her larger volume of purchases to negotiate better rates for ingredients.

But she’s not content to sit still. The company recently attended the recent Fancy Food Show in New York and came away with leads at four major wholesalers.

Moore is also sinking money into upgrading her company's Web site, an initiative aimed at increasing online sales. A new, monthly e-mail promotional campaign will cultivate existing customers.

Web sales currently make up 20% of revenue, but Moore plans to double that in 2009. She's hoping changing consumer habits will play into her online growth strategy: “It’s entirely possible given the price of gas that people may shop more online now than they are shopping in person," she says. "So that could be timely as well.”

Jesse Placencia, Photogenic Arts, Fort Worth
I own a small photography business and I am looking to try and reach a large market cost effectively. I have tried sites like Craigslist.org and placing ads in newspapers but it's just not working. When using Craigslist, people are too cheap and when using newspapers advertising costs are too expensive to keep the ad going consistently. I was wondering if anyone out there can help me find a new way of marketing my services or suggest an old way that works. Surly I have not thought of everything?

What do you recommend? Leave a comment below with your answer.

Give us your advice: Check out recent “Ask & Answer” questions.

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Ask FSB's tips for keeping customers coming back year-round, even during the quiet seasons.

Lisa Jackson, Washington Terrace, Utah
I need a balance in my business. Some months I am swamped. Other months I have nothing. How can I market my services so that work comes in steadily, but slowly enough for me to handle each client with utmost care? Should I advertise a lot and put clients on a waiting list during busy times?

By Myrlande Davermann, Fortune Small Business contributor
Dear Lisa: First, figure out what drives your sudden business spikes. What generates the excess business when you're swamped? Is that when you're doing the most marketing? Once you know what prompts your business booms, you can create a marketing plan that will help optimize your schedule.

Putting your existing customers on a waiting list during busier periods may not be the way to go. Instead, you might want to hire some qualified contractors to help share the workload, suggests Kelly Davis, president of The Strategy Tree, an HR consulting firm.

“If you proactively build a team of talented individuals that are comfortable working on a contract basis, then you will have your team ready to deploy when you need their services,” she says.

If that isn’t a feasible option, Davis recommends looking into a date-specific direct mail campaign or advertisement. The goal is to encourage customers to use your services before a specific date, coinciding with a slower period for you.

Also, consider creating a customer referral program, she recommends. You can offer clients a bonus with each referral they make – but be sure to set out specific program parameters. Do you want to offer customers a cash bonus for referrals, or a discount on your services? Do referred customers need to remain a client of yours for a specific period of time before the bonus is paid?

“Many entrepreneurs make the mistake of forsaking their existing clientele in search of new customers. This mistake can cost you. So don’t do it,” says Thomas Freyvogel, an entrepreneur and business consultant.

Freyvogel agrees with Davis's suggestion to offer referral incentives to your existing clientele. He also suggests giving out "preferred client" coupons discounting your services (again, during your slower times), sending out birthday coupons for a discount or free service, and offering incentives based on how long a client has stuck by you. For instance, you could offer customers a 10% discount after their first year with you, and a 20% discount after two years. Let your clients know that they are number one.

“You can always find new clients, but in order for the customer base to grow, you must hold on to your loyal fans,” Freyvogel advises.

Amir, Chunky n Chic, Salt Lake City
My wife and I have been making and selling hand-made, semi-precious jewelry for the last 5 years. People really love the variety, quality, unique designs and the price. We usually use chunky stones and therefore named the business as Chunky n Chic. As we grow, should keep the name or change it?

What do you recommend? Leave a comment below with your answer.

Give us your advice: Check out recent “Ask & Answer” questions.

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Tom Dunlap, La Verne, Calif.
I own a five-year-old Internet business that sells about $100,000 worth of printer toner a year. Our clients stick around due to the savings we provide – they typically cut 30% to 50% in costs – and our customer service. We’d like to stay small, but we also want to attract more customers. How can we accomplish this without spending much money? Advertising doesn’t seem to be cost-effective, and hiring salespeople hasn’t worked in the past.

By Leonora Chu, Fortune Small Business contributor
Dear Tom: Let’s try a visualization exercise. Before you attempt to attract more clients, write a description of your ideal customer. Spencer Tyler, co-owner of the Los Angeles branch of OneCoach, a small business growth consultancy, says it’s probably the person who spends the most, complains the least and sends you referrals.

Next, hone in on exactly what that client wants. It could be guaranteed product in stock, or hassle-free returns and free shipping. Once you’ve scribbled down these ideas, look at your list – that’s your marketing message.

Completing this strategic exercise will help you to maximize your marketing dollars and initiate higher response rates from new customers, says Tyler. Rather than casting a wide net for any customers, you’ll craft a pitch that’s directed towards the ones you want. “You’ll end up spending less and making more,” he says.

Now that you’ve got your message, what do you do with it? Tyler advises you to launch an e-mail campaign to attract new customers and reengage past clients. If you’re looking to expand your list of contacts, consider purchasing a targeted email list of potential customers from a broker.

Another way to expand your customer database is to form partnerships. Get in touch with complementary service providers such as printer manufacturers, paper suppliers or telecom equipment providers. This way, you can split marketing costs and offer multiple products at once.

Doug Williams, a Vancouver, Wash.-based market consultant, advises you to register for pay-per-click advertising with major search engines. Because you pay only when someone visits your website, pay-per-click offers a cost-effective marketing tool.

You should also focus on search engine optimization, he says. Improving your placement on search results will drive traffic to your business. You can hire a consultant to analyze your site and make suggestions, but there are cheaper ways to work on your SEO.

Start by making sure your home page contains plenty of keywords that characterize your business. The text should appear in the upper quartile of the home page. “Keywords at the bottom of the page won’t come up high on search engine rankings,” Williams says. “You can hit the sweet spot by using just 400 to 600 words of text.”

Another inexpensive way to get noticed is through social media. Set up a blog to share your expertise with potential customers. Williams’ ideas: Write about what to look for in a toner supplier, the differences between different types of toner cartridges, and the pros and cons of buying versus leasing copiers. “People use blogs when they’re looking for information, so it’s about branding yourself as the authority or expert,” Williams says. “Everyone likes to buy from the authority or expert.”

You should maintain a consistent theme and schedule with your posts, says David Jaeger, the president of About Results Marketing in Los Angeles. Blogs are search-engine friendly, so posting frequently will help you pop up higher on results. “If you invest 10 to 15 hours a month blogging, you should start seeing an increase in your rankings and an increased readership within two to three months,” he says. Considering the low cost of blogging, that’s time well spent.

Rodrigo, RNJ Fragrances, Miami
I started an e-commerce website. I have little knowledge of SEO and promoting my site. Where can I get some insight?

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