Sounding the Warning on Preparedness for Hurricane Sandy

The Times had a strong story on the front page Wednesday under a headline that says a great deal: “For Years, Warnings That It Could Happen Here.”

“It,” of course, refers to a disaster like the aftermath of Hurricane Sandy.

That article, by Mireya Navarro and David Chen, may have reminded some readers about another front-page effort about seven weeks ago by Ms. Navarro.

Consider these paragraphs from her prescient Sept. 11 article:

But even as city officials earn high marks for environmental awareness, critics say New York is moving too slowly to address the potential for flooding that could paralyze transportation, cripple the low-lying financial district and temporarily drive hundreds of thousands of people from their homes.

Only a year ago, they point out, the city shut down the subway system and ordered the evacuation of 370,000 people as Hurricane Irene barreled up the Atlantic coast. Ultim ately, the hurricane weakened to a tropical storm and spared the city, but it exposed how New York is years away from - and billions of dollars short of - armoring itself.

“They lack a sense of urgency about this,” said Douglas Hill, an engineer with the Storm Surge Research Group at Stony Brook University, on Long Island.

I spoke with Ms. Navarro on Wednesday. The Metropolitan section reporter who covers the environment said that she is glad that she wrote that article last month and that The Times gave it front-page display.

But now, she added, the situation â€" in the devastating aftermath of Hurricane Sandy - has moved from the theoretical to the all-too-real.

It's not in the job descriptions of reporters to make policy, but often they are in an unusually good position to make cogent observations about what they cover. Ms. Navarro did just that when we spoke.

“Rather than constant studies, we need some action steps now,† she said. “The subway alone is a major thing. If the subway goes, the city goes.”

It's notable that her September article drew nearly 250 comments from deeply interested readers, from Manhattan to the Netherlands. Infrastructure may not be a sexy topic on its face, but it matters deeply to people's lives and creates passionate responses.

The Times has given this subject significant attention, not only in the metropolitan region, but also nationally.

In its national reporter John Schwartz, The Times has a full-time infrastructure reporter, a major commitment of resources. His reporting has frequently sounded alarms about infrastructure deficiencies in the United States. In the paper's long-term, sustained coverage of Hurricane Katrina's aftermath in New Orleans, The Times showed that it knew just how important infrastructure is.

And talk about prescience. As early as 2008, Mr. Schwartz was writing about New York's vulnerability to storms wit h an article titled “Waiting for the Big One.”

But readers â€" from governors to city residents to federal officials â€" often have short attention spans and limited ability to focus on important, hugely expensive and seemingly unexciting topics.

Now the subject has come home in an undeniable way.

Ms. Navarro noted that those action steps are extremely expensive and take sustained effort over time.

“The plan is to stick with the coverage,” she said. “We know that this is not going to go away.”

Mr. Schwartz put it another way: “People do the right thing after we've been shamed into it. We don't learn our lessons until we have to.”

That moment, apparently, has arrived. But a newspaper can only do so much. So far, The Times has done its job admirably. Now it's time for public officials to do theirs.

Why I Manage My Own AdWords Campaigns

Thank you to everyone who took the time to read “My AdWords Debacle” - and especially to those who left comments. I'd like to respond to some of the most commonly asked questions. So without further ado:

Why didn't you spot the pattern sooner?

Am I just plain stupid? Not really. When I sat down to write these posts, the theme I had in mind was how difficult it was for this small-business owner to identify patterns in the blizzard of incoming data and to figure out what to do next. I hope that this idea wasn't lost as the post changed into a story about AdWords.

Life doesn't present itself as a tightly formed narrative. It's my job as a blogger to turn messy reality into an entertaining and informative story. Unfortunately, the format of this blog precludes a full exploration of the many twists and turns along the way. For instance, the sales problem could have been presented as simply a random variation that is mathematic ally inevitable when incoming jobs range widely in size (which ours do, by a factor of 10). The sales data conform very well to this hypothesis, and that's a pattern I have often seen in the past.

If I had decided to believe that story, then the post I wrote might have been about planning for inevitable downturns, and I could have expounded on how my cash management and backlog forecasting systems allowed me to ride out the dip without layoffs. Or the story could have been about how we were responding to incoming inquiries and what happened when I decided to completely overhaul our sales process. In fact, I did do that, and I believe that it had a large effect on our return to a profitable level of sales.

Or it could have been about how I responded to a big problem with a multi-pronged counterattack involving my marketing, my sales operations, our shop management, and my own financial planning. That's what actually happened - I tried everything I could think of, and each change probably had some effect on the ultimate result. But that story is very difficult to tell, in particular as it is happening. It would be better suited for a book, where each thread in the narrative can be developed fully.

It's also easy to forget that a story that took five days to recount took five months to develop. It's hard to interpret data until you have enough to draw conclusions. And it's hard to see how responses will work without giving them some time. It can take quite a while for a situation to develop to the point where it can be understood and even longer to see whether the fixes are working.

One commenter suggested that I could have avoided all of this by simply thinking about what might happen before I took action. Apparently, a little “scenario planning” allows one to see the future with perfect clarity. Really? I'd like to know what planet he lives on. Certainly not Earth, where even plans developed by the richest and smartes t businesses and governments can go badly awry.

I'm sure that I am not the only small-business owner who tries lots of things to improve sales and operations. News flash: some of them don't work and sometimes for reasons that aren't readily apparent. Any plan you can think of has potential negative consequences. Sure, some plans are so stupid that their downsides would give anyone pause. For instance, I can clearly see that it would be a bad idea to heat my shop by setting my lumber supplies on fire. But then there are plans that seem perfectly reasonable, like introducing new products to see how they will do in the market. Sometimes they succeed, sometimes they fail. Sometimes the failure is complex and subtle. I can't let that possibility keep me from trying things.

Why don't you stop managing your own advertising and hire an expert?

Plenty of commenters took me to task for trying to run my own AdWords campaign. Oddly enough, 100 percent of them - by my r ough count - were people who make their living as search-engine marketing consultants. But if I look beyond that fact, there is merit to considering the question.

AdWords, after all, is an extremely complicated program. Aside from the mysterious algorithms that drive search results and keyword quality scores, there is the incredibly complex set of controls and reporting functions that Google has provided. If I were starting from scratch today, I would hire someone to help, just as I have hired a bookkeeper and accountant to do my taxes, and a Web site developer to do my Web site. Please keep in mind, though, that I have been running the account for years and have reached a point where it is, by any reasonable standard, successful. If you measure gross sales as the metric by which R.O.I. is calculated, my return is between 15 and 20 to one. It's worked well enough to expand the business for the last three years and, with improvements we are making to the way we handle i nquiries, it should work even better in the future.

I get lots of calls and e-mails from S.E.M. consultants, even on weeks when I'm not writing about AdWords. I take the time to talk to quite a few of them, just out of curiosity. Most of them are reading from a script. “Hi, Paul. I've been looking at your Web site, and we think that with the proper help, we can get your search results onto the first page.” Dude, if you were actually looking at my Web site, you'd know that we are already at the top of free results for the search strings I care about.

“Hi, Paul. Did you realize that you could be saving money by optimizing S.E.O. results, which would let you turn off AdWords entirely?” No, pal, I don't realize that because I don't believe you, and my grand experiment last year proved that turning off AdWords was a bad idea for me.

“Hi Paul, did you know that optimizing your bids would save you money?”

“Really, that's interesting. Suppose I' m spending $10,000 a month. How much could I save?”

“Up to 20 percent!”

“And how much would it cost me to hire you?”

“At that level of service, about $2,500 a month.” Sigh.

I had a phone meeting last week with an S.E.M. company that had been recommended by some colleagues. I had contacted them and given them read-only access to my AdWords account so they could look at whatever they wanted to look at. They commented that the campaigns were well organized and that all of the obvious things - split-testing ads, using negative keywords, separate ad groups and separate campaigns, etc. - were already in use. They suggested that I increase my budget to $15,000 a month to get more clicks. But I don't need a consultant to tell me that increasing my spend by 50 percent will get me more traffic.

Here's what I would want a consultant to do: First, tell me something I don't already know about my campaign. Second, offer to provide services free for two months, so that I can see what the results are. I would happily agree to pay for those months, maybe even with a bonus, if the results were to my liking. Also, the consultant needs to be able to explain to me, up front, the thinking behind any suggested changes, and it has to make sense to me. I wouldn't hire an accountant who believed that the government didn't actually have the power to tax individuals, and I won't hire an S.E.M. consultant whose view of how Google works conflicted with mine.

There's another reason I continue to run my own AdWords campaigns - because I'm interested in it. I've always found that marketing is the most challenging and fascinating part of being in business. At its root is the whole concept of getting money, freely given, from people in exchange for the stuff that I have designed and built.

One of the main rewards of owning a small business is the ability to do something you like to do, and I like to think about complex prob lems. AdWords is just one part of a whole chain of interactions with clients that ultimately results in a sale. I need to understand it to think about how to keep the entire marketing operation working. If I outsource that piece of it, I am handing over a very important piece of our sales operation to people who neither know nor care about how the rest of the process works. There is no one better than I am, at this time, at overseeing our sales operation. I might well create a position within the company to do this, but I am not ready to outsource it.

What else did you do to fix the problem?

I did hire a consultant to examine our selling process and to recommend changes. This has been very interesting and has led to a marked upgrade in the way we respond to inquiries. I'll be writing about this in the near future.

Are you going to diversify your lead sources?

A number of commenters were concerned that I rely so heavily on AdWords. That's a legitimate point. In addition to beginning to explore exports and joint ventures, we are submitting (at long last) our application for a General Services Administration contract this month. If accepted, this will allow us to expand the business we do with the federal government. And I am finally beginning an organized effort to establish regular contacts with potential repeat customers. I'll be writing about that, soon, as well.

Thank you again for your comments. Please feel free to address anything I have missed.

Paul Downs founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.

Making Your Best Pitch

It's time to wrap up Make Your Pitch, and it is striking to me that even with the feedback on each pitch, we received very few pitches that nailed it. That being the case, I thought it might be useful to review some of the lessons we've learned.

Specifics trump generalities: Concrete figures, numbers and statistics add scale or a benchmark to your opportunities and accomplishments. Saying that I have raised a lot of capital for companies does not have nearly the impact of stating that I have raised more than a billion dollars. Saying you have a large market opportunity doesn't resonate in the way that saying you have had $50 million in revenue in four years does. Specific numbers create context, whether perceived or real.

Use the same specifics-over-generalities approach in the tactics portion of your pitch. In the TugCam pitch, for example, instead of glossing over marketing, the pitchers said specifically that they were going to leverage insurance companies who were willing to provide policy discounts as a means to reach the end users. The more detailed you can be, the better.

Founders can inspire confidence: The video pitchers have ranged from very nervous to cool and collected. While being in front of a camera - or even another person - can be a bit uncomfortable or intimidating, it's critical to remember that the main thing that an investor is banking on is you. You have to instill confidence that you are someone who can execute, and if you come across as anything less than fully confident, your chances of executing a successful pitch are slim-to-none. Also, know the difference between being confident and being arrogant. Being secure is desirable, but being a know-it-all is a turn-off.

Simplicity sells: In terms of business models, the KISS principle (Keep it simple, stupid) continues to reign. The more complicated the business opportunity, the more challenging it is to understand an d to execute. Do something and do it well; then, you can branch out into additional products and services. If you try to accomplish too much up front, you risk losing investor interest.

Take some risk out: To investors, ideas are interesting, but execution is better. Plus, the more you can achieve in terms of milestones, the less risk there is for an investor. This can range from creating prototypes to finding paying customers. The more risk you take, the less you demand of an investor, which increases your credibility, shows that you have skin in the game, and demonstrates that you can execute.

Explain how you are making money: No idea is interesting to investors if they can't make money from it. Be clear on the business and revenue model. How much do your products or services sell for? What kind of profit margins are there? How exactly do you make money? This is a critical focus for any business and needs to be addressed clearly and concisely.

Anticipate and counter objections: When you discuss your business idea or practice a business interview, there are going to be objections - stumbling blocks that will come up over and over from any savvy investor or interviewer. Know what those objections are and address them up front. Hestia Tobacco did that effectively when it acknowledged that it had a major competitor, American Spirit. Where you can, be sure to anticipate negatives, address them head-on and turn them into positives.

Communicate your differences: Ideas are only as good as the execution behind them. When you pitch, be clear about your secret sauce. Tell the investor what you are doing that is different from what everyone else does. Also, be clear if you have any protection on your difference (such as partnerships, patents, etc.). Furthermore, when it comes to execution, be clear about experience, qualifications and resources that you bring to the table to make you the absolute best person or team to dominate yo ur market opportunity.

Know what you want - and communicate it: AmericanWay was very clear in its pitch that it was looking for a loan at a certain interest rate. Know what you are seeking from an investor in terms of the amount of capital and what it will be used for. Be clear about whether you are looking for equity investors or lenders (or perhaps you are flexible). A great pitch can be wasted if you don't conclude by suggesting the next step.

This may seem like a lot of information to incorporate into a short pitch, but with practice, you can nail it.

I wish you much success in your professional endeavors.

Carol Roth is a business strategist who has helped clients raise more than $1 billion in capital. You can follow her on Twitter.

With Digital Readership Up and Pay Wall Down, The Times Covers the Storm Robustly

The New York Times had many more readers than usual on Monday and early Tuesday as Hurricane Sandy devastated the metropolitan area and beyond.

And that was for many good reasons. The Times's offerings on the storm have been robust, authoritative and remarkably varied. They were also accurate, which is more than you could say for some of what was available elsewhere, where hyped reports and faked photos added to what was already a chaotic situation.

Those offerings included everything from a webcam on the building's roof, with images updated minute-by-minute, to the overall reported story under the byline of James Barron â€" surely one of the best rewrite men in the business - with contributions from dozens of reporters in the field, and a great deal more. An interactive storm tracker was one of many graphics intended to help readers understand what was going on. A frequently updated gallery of startling photographs helped tell the tale, as did video.

I nternet traffic to the Times site went through the roof, said Ian Fisher, the associate managing editor in charge of the dayside home page and Web site.

“Digital traffic was about double what would be our highest normal day,” he said.

His aim? “Trying to do a bit of everything â€" cover all the basic news, the announcements from public officials, but also to catch the sheer scale of the devastation and the human drama and emotion.”

In addition to the quality of the report, the removal of the paper's pay wall â€" which blocks readers from digital access after a number of visits â€" was surely a part of the increased traffic.

The free access to The Times's digital sites will continue at least until tomorrow morning, said John Geddes, managing editor of The Times.

Why did The Times remove its pay wall?

“It's a quaint term but it's public service,” Mr. Geddes said. “This is a situation in which dissemination of information may h elp people make life and death decisions.” He said the free access would continue at least until 7 a.m. Wednesday.

Print readers in the New York metropolitan area were less fortunate. Bridge and tunnel closures meant that getting papers from the printing plant in Queens to Manhattan and most other parts of the metropolitan area was impossible; the paper was printed and distributed nationally. Eileen Murphy, a spokeswoman for The Times, said that undelivered Tuesday papers would be included in Wednesday's delivery wherever possible.

The fast-moving story, though, was far more suited to digital news anyway. “There's a lot of misinformation out there and we hope that people come to The Times to find out what's true,” said Fiona Spruill, who is in charge of emerging platforms, which these days tends to mean mobile devices like tablets and smartphones.

All of this doesn't happen by magic. When I got to The Times's newsroom on Tuesday morning, many of the reporters and editors who were still at their posts had barely left them since Sunday.

Carolyn Ryan, the metropolitan editor, had not slept in more than two days when I spoke to her on Tuesday afternoon. As the editor at the center of the paper's coverage, she had 42 reporters and nine editors on the story.

“We most want to be useful, we want to be truthful, we want to be encompassing and contextual,” Ms. Ryan told me.

An article that is very likely to be on Wednesday's front page is one that provides that context: A report on the city's flood zones that will detail, she said, “that the water table has changed and the infrastructure hasn't.”

It suggests, Ms. Ryan said, that “we can't live like this.”

For the breaking story, Ms. Ryan relied heavily on Mr. Barron, the rewrite man who has been working at The Times for more than 35 years â€" since a week after his graduation from Princeton University in 1977.

His challenge in writ ing the main news story, he said, is to “take a big story and turn it into something that makes sense, is accurate and reads well.” Weaving together reports from many reporters in the field is part of the challenge.

“When they are all clamoring for the copy and everything is still happening,” it's difficult, he said. “Getting it right is the first and foremost thing.”

What You Need to Know About Merchant Cash Advances

Ami Kassar. Joe Maguire: “I haven't lost my shirt yet.”

Every morning, before I start my day, I stop for a cup of coffee and a bagel near my office. I have to choose between the local Dunkin' Donuts franchise and Maguire's, a boutique sandwich shop. Invariably, I pick the sandwich shop. I know the owner, Joe Maguire, and I like to support him. Also, his coffee is great.

Mr. Maguire has owned the shop for almost a year. He knows his customers by name. I often see him at the back of the store loading products onto the shelves after a trip to Costco or helping with a breakfast run.

“How are you doing, Joe?” I ask.

“Hanging tough, Ami,” he replies with a s mile. “I've almost survived Year 1, and I haven't lost my shirt yet!”

As I walk to work, I feel good about my choice as a consumer, but I don't feel great about how our banking system is treating Mr. Maguire and millions of other small-business owners like him. The life of a small retailer is tough these days, and there are few signs that it's getting easier.

What, for example, are Mr. Maguire's options if he wants to get a loan to increase or expand his business? What happens if the radiator goes out and needs to be replaced, or if the oven blows up in the back of the kitchen? What happens if there is a bad winter and sales slow unexpectedly?

Mr. Maguire probably cannot turn to a bank. He has two strikes against him: he hasn't been in business for at least two years, and, unless he is one of the lucky few with equity in their houses, he has no collateral for a loan. The bankers aren't interested in the coffee urns or the c oolers holding Snapple.

If Mr. Maguire is lucky and gets good advice, he may find one of the few banks that still offer unsecured Small Business Administration Express loans up to $50,000. The good news is that if you can get one of these loans, the rates are reasonable. The flip side is that Express can still take a few weeks and lots of paperwork, and Mr. Maguire may not have time to wait.

In this situation, he may well turn to one of the merchant cash advance lenders that are having a field day in today's economy and that will promise Mr. Maguire unsecured money in just a few days. The lender will review Mr. Maguire's recent merchant processing statements, bank statements or both, and then make what is often a tempting offer. In Mr. Maguire's case, the offer might be an immediate $20,000 in exchange for $25,000 of future receipts.

It sounds tempting because the owners figure they can get $20,000 immediately, and it costs only $5,000. Think about it, thou gh. The $5,000 is 25 percent of the amount they're borrowing, and it's actually even worse than that. Considering that most of these loans have to be paid back within six months, the actual interest rate may be more than 50 percent. That is a lot for any small-business owner to swallow. The lenders can get away with the high rates because they are careful not to call these transactions loans. They say they are buying a piece of a company's future revenue.

If you are in the market, here are some things to consider:

Insist on seeing all of the fees upfront, and make sure you understand every one of them.

Make sure you understand the terms. Some of these loans involve a daily fixed amount taken from your account; others take a percentage of your credit card sales every day. A lender, for example, might demand 10 percent of your daily credit card receipts until you have paid back the agreed-upon amount. Don't focus on the 10 percent figure - that is not the ra te you are paying. I had to explain to one client that his effective interest rate was more than 90 percent.

Insist that the cash-advance company provide at least a projected annual percentage rate, or A.P.R., for your loan. This makes it much easier to compare the advance with other options. In addition to an S.B.A. Express loan, there may be business credit cards or equipment leases available to you at better rates.

Shop around. The cash-advance business is competitive. Make sure you're getting the best possible rate.

The sad reality of today's credit markets is that many small businesses have no choice but to consider these types of loans. In our work at MultiFunding, we often find that there is no better option. Still, whenever I am forced to put a client into one of these high-rate loans, I think about Mr. Maguire and the struggle he is facing to build his business, as well as his crew of four employees who count on him. Yes, the merchant cash advance lenders and the hedge funds that back many of them are filling a need in today's market. But there has to be a better way.

Ami Kassar founded MultiFunding, which is based near Philadelphia and helps small businesses find the right sources of financing for their companies.

This Week In Small Business: Frankenstorm!

What's affecting me, my clients and other small-business owners this week.

The Big Story: Small Devices

Apple introduces the iPad Mini, and here's everything you need to know about the new device. Google and Samsung introduce a Chrome laptop and a new Android tablet. Microsoft, its empire under siege, rolls out Windows 8 and the Surface tablet. Nathan Eddy believes that Windows 8 could both assist and confuse small-business owners: “The biggest risk Microsoft is taking with Windows 8 is the redesigned user interface, which has left users confused when trying to learn the new system.” Most companies will not be early adopters of the new operating system. Matt Burns says the Surface “is not a tablet, it's a PC.”

The Election: An Indicator

Small-business owners in swing states called the third debate a victory for President Obama. But Ryan Higa could be the dark horse. The Federal Reserve plans to keep buying bonds; many believe the election wi ll affect the chairman's future. Sales of Halloween masks indicate a win for Mr. Obama. A lawyer advises employers to be wary about telling employees how to vote.

Economy: The Bright Spot

Russell Investments updates its state of the economy with all but one indicator within normal range. Orders for durable goods rebound. FedEx forecasts online shoppers will generate a holiday record. Equipment-financing confidence holds steady. The United States is experiencing a renaissance in oil production and is expected to be the world's largest producer. Goldman Sachs predicts an end to high oil prices. Kate Mackenzie thinks the United States is the bright spot of the world. Still, manufacturing contracts in the Richmond, Va., Fed district and the steel industry continue to decline. DuPont cuts 1,500 jobs, and Dow Chemical plans to close plants and lay off 2,400 workers. Stocks plunged Tuesday on earnings woes. John Mason believes that economic policies continue to weigh on the dollar. Home sales are rising, but Bill McBride isn't impressed: “Even with a 20 percent-plus increase this year, 2012 will be the third or fourth lowest year since the Census Bureau started tracking new home sales in 1963.” The most recent Sage business index of nearly 11,000 small- and medium-size companies shows a significant fall in local market confidence. Which is scarier: the fiscal cliff or Frankenstorm?

Start-Up: Women Veterans

A new study finds that more than half of women veterans who own businesses say their leadership experience in the military inspired them to start their businesses, and another report finds that growth in businesses owned by women has paralleled increased contributions by women across the economy. Meanwhile, a conference for start-up founders is criticized for its lack of women. Denver has its start-up week. John Patrick Pullen suggests nine cities you wouldn't think are hubs for tech start-up s. Tanya Prive says these are the venture capitalists every start-up should know. Martha Pierce asks why start-ups fail.

People: Employee Burnout

John O'Farrell gives advice for hiring your next vice president for sales. A study finds that many people like to overestimate the number of hours they work. A report concludes that federal employees earn 8 percent more than their private-sector counterparts. Verne Harnish suggests five ways to find extraordinary employees. Wal-Mart has entered another battle with its employees. Over 30 years, Microsoft employees have raised $1 billion for charities. Christina DesMarais lists five Silicon Valley tech companies everyone wants to work for. Managers who consider hiring ex-military people are sometimes deterred by the possibility that candidates have post-traumatic stress disorder. Employee burnout increases. An impromptu board meeting springs up in a Staples store.

Social Media: Warming to Facebook Ads

Ke rry O'Shea Gorgone has a guide to minimizing legal risks in social media. Marcus Sheridan explains why our definition of social media engagement and interaction is wrong. Local businesses are starting to warm up to Facebook ads. Amy Nielson believes that one of the best ways to market your business is to create your own social media network. If you follow this pizza chain on Twitter, it will really follow you back. Twelve feline finalists are announced for this year's Friskies.

Marketing: Abandoning AdWords?

Greg Sterling does not believe small-business owners are abandoning AdWords. Marty Diamond thinks your landing pages may suffer from a lack of focus. In this commercial, passengers in an elevator are frightened. Jeanmarie Bills and Elena J. Forbes have some tips on how to create a blog for your business. Brad Hanner says you need an online presence.

Red Tape: The Internal Redistribution Service

So far, it appears the Affordable Care Act is not cau sing small businesses to drop their employees' coverage. And sorry, men's club owners, but it seems lap dances are indeed taxable in New York State. A guy lights up his house for Halloween - Gangnam style. Peter Schweizer says the Internal Revenue Service “is morphing into the Internal Redistribution Service.”

Sales: Born to Fail

Here are six reasons to walk away from a deal. Brian Carroll suggests five steps to ensure your lead generation stays on target. Here's how to turn your iPad into a Square point of sale register, and here's some good advice on pricing your products. These products were born to fail.

Management: Worst Decisions Ever

Here are the worst business decisions of all time. Mark Zuckerberg, Ben Silbermann and Ben Horowitz talk about lessons learned. Linda Clevenger has some time-management tips for entrepreneurs. George Bradt suggests three steps to a winning attitude for a service business. Andy Birol says you need to answer the se questions. Deanne Katz gives advice on avoiding burnout. Ilana Rabinowitz says you should make competition irrelevant. Felix Salmon explains why Apple doesn't care about its competition. Gwen Moran evaluates the strengths and weaknesses of four leadership styles.

Around the Country: Farmland Prices

While the big businesses in aerospace and defense make headlines, small companies form the backbone of the East Valley in Arizona. Here's what happens when Seattle becomes empty. The Army Corps of Engineers' Engineering and Support Center in Huntsville, Ala., will hold a small-business forum on Nov. 9. In New York, a restaurant taps Instagram users to create a visual menu. Farmland prices continue to soar, and the effects of this summer's historic drought are yet to be known.

Around the World: Sticker Shock

The Bank of Spain sends a warning. The United States is the fourth easiest country in the world (PDF) to do business in. A Korean start-up adjusts to life in London. The cost of living can cause sticker shock, depending on where you do business. Ikea is using wind and sun to be energy independent.

Cash Flow: Surplus Capital

U.S. Bank is offering a new way for customers to pay for online purchases with Visa debit or credit cards. A new version of Google Wallet is coming. Small Business Administration loans to small-business exporters are on the rise, and the agency's venture capital program grows even as overall venture capital dollars decline. Mark Bell asks if you know what it means to evaluate your spend. Angie Mohr says there are four financial yardsticks for your business. The Principal Financial Well-Being Index finds that 63 percent of small-business owners have surplus capital but that 73 percent of those who have it are not spending it.

Technology: The Worst Password

Bizelo, a cloud software start-up, is creating a collection of small-business applications. Amazon Cloud goes down again. Cu stomer data is hacked at Barnes & Noble. Facebook reports better than expected earnings, and Peter Gabriel asks his Facebook fans to recreate “Sledgehammer.” New research promises to increase bandwidth tenfold. Password tops the list of the worst passwords of 2012. Professors develop a real-life “Star Trek” tractor beam. Bob Lefsetz shares some dos and don'ts, like: “Don't think Apple is forever.” James Bond uses an Android smartphone. If you're not interested in tech, here's how to pick up a girl at the gym.

Best Tweets of the Week

@ValaAfshar
The web is your resume and social networks are your mass references. Paper CVs will disappear in 5 years.

@PFripp
I don't judge a company by the people who travel by corporate jet; I judge a company by the ones who answer the phone and carry your bags.

Bests of the Week

Deborah Brown thinks that entrepreneurs need to have more fun: “Delegate or eliminate. If the day-to-day tasks are weighing you down, find ways around them. Are you asking for help with the chores, or are you doing everything yourself? What can you order online so you don't have to go to the store? And who can you hire to help with the cleaning, laundry, cooking, etc.? Yes, these things cost money, but do you think that not having fun is costing you more?”

Adrian Swinscoe says to apply the granny test to get closer to your customers: “Take a step back and look at the language that you use in your marketing, sales and customer service, and ask yourself if it is in your customer's language. Not convinced? Then try this: apply the granny test, i.e., give your marketing materials to your Granny and ask her if she gets what you are talking about. If she does, then she is either an expert in your field or you're doing a great job. If not, then you know what to do.”

This Week's Question: Have you tried advertising on Facebook?

Gene Marks owns the Marks Group, a Bala Cynwyd, Pa., consulting firm that helps clients with customer relationship management. You can follow him on Twitter.

\'Great Journalism\' That Has Unwanted Business Impact in China

Here's one memorable part of the coverage of the Chinese government's censorship Friday of The New York Times's Chinese-language Web site: the word “harmonized.”

The word crops up in a Washington Post story about the Chinese government's decision to block The Times's Chinese-language site. It has to do with reaction to the David Barboza article on the vast wealth of the Chinese prime minister â€" reaction that also was deemed inappropriate for viewing.

A respected professor at a Chinese university posted a comment about the article, The Post reported, but that comment lasted only one minute.

“It's already been harmonized,” an observer noted. Read: deleted.

There surely was less harmony for advertisers on The Times's Chinese site, whose ads also were blocked from millions of viewers.

Nor could there have been much harmony for those at The Times who deal with advertising revenue, a difficult-enough propositio n as a discouraging third-quarter earnings report made clear on Thursday.

The episode is an extreme example of an enduring newspaper-world fact: journalism and business interests don't always go hand in hand.

The Times did exactly what one would hope and expect: It published a great story without undue regard for the short-term business consequences.

And, given The Times's financial challenges and its major effort to become a true global news organization, that took guts.

On Friday, I interviewed the publisher Arthur Sulzberger Jr. about the story, the censorship and what it means for The Times's global push.

“I'm very proud of this work,” he said of the story. “Our business is to publish great journalism. Does this have a business impact? Of course.”

Mr. Sulzberger said the publication of the article was preceded by “conversations with the Chinese government to discuss it.”

“They wanted to air their concerns â€" which I listened to, as I should,” Mr. Sulzberger said. “And eventually, we made a decision to publish.”

The timing is awkward, in that The Times began the Chinese-language site only this past summer, and this month began a similar effort in Brazil.

But that timing “was not in my control,” Mr. Sulzberger said. “That has to do with when the story is ready to go.”

Those who advertise on the Chinese-language site did not receive advance warning of the story and its likely consequences, he said.

“We didn't tell them, any more than we would tell any advertiser about a story that was coming.”

But now, he said, The Times's advertising department is talking with advertisers, “and we'll work with them” to remedy their lost advertising.

Joseph Kahn, the foreign editor, told me that he knew when the reporting on this story began â€" about a year ago â€" that it would be a “threshold issue” for the Chinese government.

“I ex pected it to test the limits of what they would tolerate from the foreign media,” he said. (In speaking with me, he emphasized that Mr. Barboza's direct editor on the story was Dean Murphy, a deputy business editor.)

“For us, this is just classic New York Times investigative journalism,” Mr. Kahn said. “It's what reporters do. For them, this is not what reporters do. This is what reporters are banned from doing.” He said he believed that, by various means, the story is still getting out in China and that “it has done nothing to diminish the reputation of our journalism.”

Mr. Kahn said that as recently as Wednesday, Mr. Sulzberger and the executive editor, Jill Abramson, met with Chinese government representatives at The Times. But the focus of that conversation was not about the journalism â€" it was about a political and cultural differences.

In short, Chinese officials were making the case that The Times not publish the article.

“I'm gratified â€" there's no other word to describe it,” Mr. Kahn said about The Times's decision to publish it. “People cite the Pentagon Papers, but that involved defying a legal order.”

This decision, and others like it that may follow, Mr. Kahn said, have the potential to be more costly, given The Times's global strategy.

“This may be a taste of the Pentagon Papers of the future,” he said.

My AdWords Debacle: A Wake Up and a Fix

Laura Pedrick for The New York Times Paul Downs: This was my problem and I had to solve it.

Over the last few years, I have made a conscious effort to find ways to get advice from other business owners. Writing this blog was the first thing I did, and I have found the feedback from commenters to be valuable. This year, in an effort to find a more focused set of advisers, I joined a Vistage business group. We meet once a month, and a portion of each meeting is devoted to analysis of business issues that each member presents. When a member of the group presents a problem, the other owners listen, ask questions and then suggest solutions.

Through the spring, I kept the group updated as my sales collapsed, and in May, I told everyone that I felt like a victim of a bad economy. The thing was, nobody else in the business group was having such a hard time. Many of them felt the economy could be better but that conditions were still favorable. I seemed to be the only one who was suffering and the only one who thought that the problem was out of my control. One of the members told me bluntly: “I don't want to hear any more about the Euro or health care or whatever excuses you come up with. This is YOUR problem, and YOU have to solve it.”

Excellent advice. Complaining hadn't helped, upping my ad budget hadn't worked, so I had to keep trying things until we either recovered or went under. But if it wasn't an outside problem, then what could it be? It had to be something about my marketing, and that meant the problem was in AdWords. Once I decided the problem had to be there, I started looking at the data again to try to find a solution. But this time I approached my analysis with the conviction that the problem was something I had done - not something that was beyond my control.

I went back to the basic problem: no more calls from bosses looking to spend their own money. Where had they gone? Looking at the data again, I spotted a pattern that I had overlooked. After I had introduced those modular tables, we started getting more calls for them from schools and non-profits, most likely driven by our Modular Table ad group. These calls tended to come in the morning or middle of the day. Unfortunately, neither schools nor non-profits have much money, so these inquiries weren't generating much revenue.

Bosses, who actually have decent budgets, tend to call late in the day, after completing all of their pressing tasks. Although I didn't have a way to prove this, I believed that our calls from bosses were driven by our Boardroom Table and Custom Conference Table ad groups. These two groups have relatively low traffic, but they get high click-through rates and generate a high proportion of e-mail submissions. I started tracking to see whether the ads in these groups were appearing throughout the day, and sure enough, by about 2 p.m., they had stopped running.

The daily budget hadn't been exhausted, but Google was only showing the ads that got the most impressions and the most clicks - even though their click-through rate was much lower than some of my other ad groups. All other ads were being shut off, so that more money could be devoted to the ads with the most traffic. This approach maximizes Google's revenue. If the impressions are huge, it doesn't matter to Google if the click-through rate is low - even though the minuscule rate is an indication that there is little real interest in the product.

In other words, my budget was being wasted. It was putting ads in front of people who weren't as interested in our products and couldn 't really afford them. But because the number of people searching was so high, the total number of clicks generated far outstripped the traffic from my more focused ad groups. Google's algorithm saw the total number of clicks generated as evidence of success, regardless of whether we closed any business. By all of its own metrics, the AdWords campaign was a home run. I had received lots of impressions and bought lots of clicks. The only problem was that these apparently were the wrong clicks.

So now I revised my theory about why my sales had tanked. I started telling myself a new story - not that the economy was collapsing but that my AdWords spending was going to the wrong people. And I put in place a revised campaign with a very different structure. In order to keep running the ads that I most wanted running, I had to stop the other ads from draining their budget.

Fortunately, there's a simple fix for this. You can fragment the big campaign into several smaller campaigns, and you can give each campaign its own budget. I separated the Modular Table group and a couple of other high-impression, high-click, low-click-rate ad groups into a campaign I called the “Vacuum Group” - because it had sucked the life out of the other groups - and I limited its budget. I also broke out Boardroom Tables into its own campaign and increased its budget. And the rest stayed in the Long Tail group with a third budget. The total of all of the budgets was still $600, but they could no longer affect each other.

Wouldn't it be lovely if, after you make a strategic adjustment in your business, you could find out immediately whether it had a positive effect? Unfortunately, things don't work that way. After I restructured my campaigns in late June, a period of weeks followed during which I had to force myself to leave my AdWords campaigns alone to see what would happen. The first week after the changes included the Fourth of July, and we got very few calls. But the following week saw a significant jump in the number of incoming calls, and for the first time in a month, there was a nice sprinkling of boss calls.

Through the years, there has been a pattern to our sales in the months when we have met our sales target. About a third of our customers place an order relatively quickly after calling, within a month. Another third take longer, from one to three months. And another third can take anywhere from three months to a year. So when our pipeline quality deteriorated, the jobs that disappeared were from the first two groups. But then, when my new campaign started driving better leads to us, it still took a while for us to catch up with that slower moving third group and get our total sales back where they needed to be.

In July, our sales were $144,893 - not awful but not where I wanted them to be. At last, in August, we got back to our target, closing $200,607 in new orders. September was also strong: $220 ,361. And in October, we hit our target in the first three days of the month. Those jobs included a number of orders from large corporations that had delayed their spending until the end of their fiscal year.

So now I have some breathing room. My cash is still way behind where it was at the beginning of the year, but if sales stay strong I should recover before the year ends. I think my problem is fixed. That's the story I'm telling myself, anyway.

Paul Downs founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.

Pursuing the BBC Story \'With Objectivity and Rigor\'

A few further notes on the matter of the incoming New York Times president and chief executive, Mark Thompson, the former director general of the BBC, which I wrote about on Tuesday:

1. The byline Matthew Purdy, atop a story in Thursday's Times, speaks volumes. Mr. Purdy is the highly respected head of The Times's investigative reporting team. That Times top editors sent him to London - to report on the unfolding scandal at the BBC, which is under fire for killing an investigative report on sexual abuse by its celebrity TV host Jimmy Savile â€" says that they are indeed taking this seriously. (I want to make it clear that, as public editor, I had nothing whatsoever to do with that decision and that it was already made by the time I wrote my blog post, urging aggressive coverage.)

It is somewhat unusual to see Mr. Purdy's byline â€" this time it is combined with that of Christine Haughney, a media reporter in New York. It indic ates that he is taking a “player-coach” role. The article includes this sentence: “The director general at the BBC is both chief executive and editor in chief.” That casts some light on my earlier comparison of the director general to a newspaper's publisher, making it clear that they are different roles.

The article appeared on Page A8 of The Times on Thursday with a brief front-page summary directing readers to its presence.

2. In a communication to Times employees on Thursday, The Times's publisher, Arthur Sulzberger Jr., offered strong support for Mr. Thompson, praising his ethical standards and calling him “the ideal person to lead our company.” Mr. Sulzberger also acknowledged the situation in Britain and the questions it has raised about Mr. Thompson's role at The Times, but said he is satisfied with the answers he has received.

He also said he and Mr. Thompson fully support The Times covering the BBC story “with objectivity and ri gor.”

His “On the Record” statement, posted with the company's third-quarter earnings report on its intranet system, says in part:

I want to address a topic that has been on many people's minds. You no doubt have read the recent reports of a controversy regarding the BBC's decision in late 2011 to cancel a news story investigating allegations of sexual abuse and molestation by an on-air BBC talent, Jimmy Savile, who died last year. Mark has provided a detailed account of that matter, and I am satisfied that he played no role in the cancellation of the segment.

In the months leading to our decision to bring Mark to the Times Company, Michael Golden, our vice chairman, and I, along with the rest of our Board of Directors, got to know Mark very well. Our opinion was then and remains now that he possesses high ethical standards and is the ideal person to lead our Company as we focus on growing our businesses through digital and global expansio n. Some of you have already had the opportunity to meet Mark and many more of you will in the coming weeks and months. We are all looking forward to that day when he takes the helm.

As you all instinctively know, but it is worth stating again, we will cover the Savile story with objectivity and rigor. Mark endorses that completely as do I. Both of us believe passionately in strong, objective journalism that operates without fear or favor, no matter what it is covering. We have dedicated a significant amount of resources to this story and this is evident by the coverage we have provided our readers.

I'm looking forward to reading further reporting from Mr. Purdy and other Times reporters on this subject, not only because of the potential importance to The Times and its readers, but also because it concerns the BBC's inappropriately killing of an important story. That is an issue that goes to the heart of honest journalism.

My AdWords Debacle: Waiting for a Miracle

As I said in Wednesday's post, my first theory of why my sales were dropping last spring was that the world was going down the drain again, just as it had in 2008. Or maybe my corporate clients were feeling bullish and decided to invest in hiring instead of burning profits on fancy conference tables. I could find plenty of evidence for either idea in the papers. At any rate, I convinced myself that something had shifted in the outside world and there simply weren't as many shoppers looking for tables.

Our sales for the first quarter were $542,555, below my target of $200,000 a month but better than the same period in 2011. Here are the numbers for the second quarter:

April: $146,677
May: $114,042
June: $ 62,000
Total: $322,719

The total was bad, but the trend was worse. Those June sales were our lowest since August 2008. And of course, the sales slump did serious damage to my supply of working capital.

Most of our sales are structured as three payments: a 50 percent deposit and a 35 percent preshipment payment with the balance due 10 days after delivery. In other words, half of the cash comes from closing the deal, the other half from completing the job and delivering it. As the cash from incoming orders disappeared, I kept the factory running at full speed, so that we would continue to get the completion payments. This meant that my expenses were not shrinking.

An alternative strategy that makes sense, theoretically, is to cut variable expenses in line with the sales drop. But the only way I have to do this is to lay off people. Good workers are hard to find, though, and I'll do almost anything to avoid losing them. Throu ghout the spring and summer, even though our sales didn't merit it and our backlog was disappearing, I kept all of my people on payroll - with a single exception. There's one person I can shortchange without worrying that he'll quit and find a better job, and that's me. I stopped my own paycheck in April.

Having concluded that demand was shrinking and that I'd need to make a greater effort to find more work, I took another look at my advertising budget. One of the interesting features of AdWords is that you can model how many clicks per day your ads will get at various budget levels. There's an analysis screen where you can punch in a daily spending total and see how well your campaign will perform. In general, spending more money brings more clicks. But as you get to the upper portions of the total available traffic, each additional dollar buys you fewer clicks. For instance, it might cost you $500 to get 1,000 clicks, $1,000 to get 1,500 clicks, and $2,000 to reach 1 ,750 clicks.

Not only does Google tell you exactly how many clicks are available for every level of spending, it also tells you how many clicks you are missing. And it tells you what level of spending - the maximum recommended amount - it would take to buy the rest of the clicks. What it leaves out is that the additional clicks you buy may not be of sufficient quality to result in additional sales. Because I've always had concerns about this, I've set my daily budgets at numbers that I feel I can afford. These have tended to be about 30 percent less than Google's maximum recommended amount. But that still gets me about 80 percent or more of the available clicks, and that seems to me to be a decent value.

Google wants people to buy more clicks, so little warnings appear on the control panel if your daily budget is spent before you buy all of the available clicks. The warnings let you know that you will get no more clicks that day. As spring wore on, I started to s ee those warnings with greater frequency and earlier in the day. (I tell Google to run my ads weekdays from 8 a.m. to 10 p.m. Eastern time, which covers business hours for the continental United States.) Curiously, we had not experienced a drop in clicks that matched our drop in sales - on the contrary, impressions and clicks for my ads had increased in the second quarter. I decided to take some of the money I was not paying myself and increase my AdWords budget. In late April, I raised my daily spend from $475 to $600.

Here's what happened: Google happily took my money and delivered more impressions and more clicks on my ads. But as for calls and sales, things kept getting worse and worse. Now I was ready to panic. We were running out of work and cash. And I was still telling myself that I was seeing a retraction in spending from my customers. I still believed I was being crushed by forces outside my control.

Friday: A Wake Up and a Fix.

Paul Downs founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.

Three Critical Aspects of a Killer Slide Presentation

TerraCycle's business is to make nonrecyclable waste recyclable by creating national collection and solution programs for things like cigarette butts and chip bags. Today, we have more than 32 million people collecting waste in 22 countries. We offer free shipping and, typically, a small donation of 2 cents per piece of waste to the collector's favorite school or organization. As you can imagine, this is an expensive undertaking. To make it work, we go to hundreds of major companies like Imperial Tobacco and Frito-Lay to gain their financial backing and sponsorship.

Years of appealing to these large clients has taught us that our best tools to reach them are the slide presentations, or decks, that we create. While these presentations are a staple of today's business world, it is surprising to me how much our employees vary in their abilities to make them. Some seem to have an innate talent for producing compelling decks, but the majority need guidance and education.

One reason the presentations are so important is that after we give them, we leave them behind - in fact, it's usually the only thing we leave with the client. And many times the client will take the presentation and share it internally, without us in the room. As a result, it is the most important tool in our sales arsenal.

Six months ago we decided to try to articulate the fundamental tenets of great presentations. Because they are stories that are told to convince the viewer of something, they should have an arc: a beginning, an apex and a conclusion. They should be purposeful, beautiful, even entertaining and enjoyable. My conclusion is that there are three critical aspects to a convincing and successful presentation, and these should be applied not only to each slide individually but to the presentation as a whole.

Aesthetics: For a deck to be credible and convincing, it has to look the part. The extra minute spent on maki ng a slide look sharp is worth everything. Anyone can take a PowerPoint or Keynote template and add some bullet points, but few people take slide design seriously. A former employee who used to work at one of the big consulting firms told me that it has a set of templates ready to go to help tell any story. Some common mistakes include using too many font types, having too much text on a slide and having too few visuals. When you complete a slide, ask yourself whether its layout is the best you could possibly have created.

Clarity: The most important question is whether the client might misinterpret information in the deck, and it's crucial because so many presentations are e-mailed around by the client or presented internally without you there to explain. Common mistakes include not labeling both axes of a chart, using internal lingo that may not mean anything outside your organization, and making false assumptions about your client's level of understanding. Ask yours elf whether a random person with your client - unfamiliar with the context of your proposition - could explain your pitch.

Purpose: This is probably the most overlooked aspect of a successful presentation. Does the presentation build to a desired outcome, or is it just a collection of random facts? The most common mistake here is not being conscious of the flow or arc of one's presentation and not building to a climax. Ask yourself whether every slide - and the presentation as a whole - advances your objective.

Not only have we developed tools and seminars to help train staffers, we also recently created a deck-review committee that checks every presentation before it leaves the building. This means we are reviewing 10 to 20 presentations a day, but the time invested has significantly improved our proposals and our chances of getting a yes.

Tom Szaky is the chief executive of TerraCycle, which is based in Trenton.

What Price Growth?

Peter Wynn Thompson for The New York Times Nick Sarillo thinks his back problems had something to do with the stress of trying to keep the doors open.

Nick Sarillo's dad always warned him about the dangers of trying to manage more than one restaurant location.

In a Conversation we've just published, Mr. Sarillo talks about his efforts to build a small chain of Nick's Pizza and Pubs near Chicago. Unfortunately, while Mr. Sarillo focused on creating an innovative, community-minded culture for his restaurants, he lost track of his company's financials. He overborrowed and overbuilt, and when the economy turned he almost lost ev erything. Only an impassioned online plea to his customers kept the doors open.

The restaurants have survived, but the ordeal has taken a toll on Mr. Sarillo. “I've never been in this kind of situation,” he told Ian Mount, who interviewed him. “I've always made my payments, ever since I was 16 years old. So the responsibility at a personal level weighed heavily on me. So much so that - while I'm very athletic, I work out, I swim a lot - at the end of this, right around Labor Day, my back tightened up. I'd blown two disks in my back. I totally believe that had something to do with the stress I was holding.”

Despite the stress, Mr. Sarillo said he still hopes to build more restaurants. He knows, however, that it's not going to happen soon.

Are you trying to grow your business? Have you asked yourself why?

My AdWords Debacle: Statistics and Stories

Everything looked good except the actual sales numbers.

As I mentioned in Tuesday's post, I keep track of a bunch of metrics in order to see how our sales process is working. Beyond the most important number (monthly sales), I look at Web site traffic; the number of inquiries coming in each day, week, and month; the number of proposals written; and how much each salesman contributes to these totals.

My records are kept on various spreadsheets, which are on Google Docs and are shared with my salesmen. The Web stats are done through the AdWords campaign management screens, which I access by logging into my AdWords account. (These screens are so complex that I can't des cribe them - and Google doesn't even have a help page explaining them, or at least I couldn't find it.) At any rate, I keep track of enough information that I can form a statistical picture of what is happening. And I do this for many other aspects of our operation besides sales.

The business generates a huge amount of data. We have all of the basic financial information that we track with QuickBooks. I keep another set of spreadsheets that I use specifically to track cash flow. We have a database program that tracks manufacturing data, including: the number of hours and materials used per project, the difference between these totals and our cost estimates, and whether we are ahead of or behind schedule. I have payroll data.

I also have information that isn't quantitative but is important, like the mood in the shop, the state of the machines, the number and nature of mistakes made by workers, and the amount of waste in the trash cans. And, like everyone else, I a m subject to the ebb and flow of news from the outside world, particularly stories about the economy and business. It all adds up to something like Niagara Falls landing on my head. The challenge, of course, is to pick meaning out of all of that falling data and come up with a plan of action that makes sense.

As winter turned to spring this year, many of my statistics were looking good. But there was a worrisome trend to sales - the monthly total was falling. I wrote about this in April, but these sales numbers say it all:

January: $193,154.
February: $213,669.
March: $135,732.
April: $146,677.

Of course I was worried, but the vast majority of the metrics I was tracking looked good. The shop was operating efficiently. The number of incoming inquiries in the first quarter was steady with recent months and 20 percent ahead of 2011. The sales force was churning out proposals fast enough to keep up with the inquir ies. We had sold more jobs than during the same period in 2011. Everything looked good except the actual sales numbers.

My business has been through a lot since 1986, including booms, recessions, and stagnation. Our clientele over the years has been a pretty good snapshot of the segments of the economy that are doing well. In 2007 and 2008 we did a lot of work for financial titans in New York. After the crash, that work disappeared, but health care companies took up some of the slack. The military and defense contractors have been steady for the last five years. Same with lawyers and accountants.

We also get a lot of inquiries from a grab bag of smaller companies - these calls tend to come directly from the bosses, owners who are looking for a table that they can be proud of for their own office. I call these “boss-driven transactions,” and they are our bread and butter. These clients aren't as price sensitive as others, and they tend to make buying decisions quickly. We close a higher percentage of these sales than any other type. They vanished in 2009, but we saw them reappear in 2010 and stay strong in 2011 and the beginning of 2012.

Then, in the spring, I noticed a change in our mix of inquiries. Driven by our successful product roll out, we were seeing more calls for low-priced modular tables. These were coming from schools, municipal governments, and nonprofits. But there was a noticeable slow down in both large corporate clients and boss-driven clients. And the total number of calls per week began to swing wildly, with the average dropping almost 25 percent (from 16 in the first quarter to 12 in April and May.)

Maybe I'm unusual, but I like to have a story to tell myself about what's happening in my business at any given moment. It doesn't matter what the subject is, I will come up with a theory. Of course my business has dominated my thoughts for most of my adult life, and I'm adept at spinning a narrative to fit whatever is happening at the moment. Every day I tell myself a story about what is going on, and I draft future chapters that help me decide what to do next.

As sales fell in the spring of 2012, I put together one of these fables in my mind. What was happening? The sky was falling again, I concluded, just as it had in 2008 - bosses and corporations everywhere were scaling back on spending, hunkering down for another bad period. I was about to be victimized by vast forces that were beyond my control. Having convinced myself that this was the case, I now needed to decide how to respond.

Thursday: Waiting for a Miracle.

Paul Downs founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.

Times Must Aggressively Cover Mark Thompson\'s Role in BBC\'s Troubles

One of the most difficult challenges for news organizations is reporting on what goes on inside their own corporate walls. Two global media companies, the BBC and The New York Times, are dealing with that challenge right now, as a complicated sexual abuse scandal â€" with a media scandal component - unfolds in Britain.

On Tuesday, the director general of the BBC, George Entwistle, was grilled by Parliament about his role in the events at the well-respected British media company.

A tough investigative committee is raking him over the coals about whether he knew what was going on when the BBC killed an investigative segment on its “Newsnight” program about a celebrity TV personality, Jimmy Savile, accused of sexually abusing hundreds of young girls. Mr. Savile died last year.

Killing the story has impugned the BBC's integrity.

Mr. Entwistle, though, was not the director general of the BBC when all of this was going on last year.

That was Mark Thompson, who is now the incoming president and chief executive officer of The New York Times Company. Mr. Thompson was said to be in the Times building on Monday for preliminary meetings, but he hasn't started yet. In fact, Times reporters and editors were reminded on Monday in a style note not to refer to him in articles as the current president and chief executive:

Mr. Thompson will be the president and C.E.O. of The New York Times Company starting Nov. 12, per Robert Christie, senior vice president of corporate communications. Until then, he is still “incoming.”

The style note even resulted in a correction on the Web site of The Times.

To its credit, The Times is reporting this story regularly though its London bureau, and has displayed it several times on the Web site's home page. The London article was summarized in a brief on the front page on Tuesday.

Mr. Thompson has been quoted repe atedly saying he knew nothing about the investigation being conducted by the “Newsnight” program, or at least that he was never formally notified about it. Here's The Guardian's report on that.

How likely is it that he knew nothing? A director general of a giant media company is something like a newspaper's publisher. Would a publisher be very likely to know if an investigation of one of its own people on sexual abuse charges had been killed? The answer to that is not as easy as it sounds. Because of the intentional separation between editorial and business-side operations, publishers usually don't know about editorial decisions - unless they are very big ones, fraught with legal implications. A Reuters story explores this subject.

And for that matter, how likely is it that the Times Company will continue with its plan to bring Mr. Thompson on as chief executive? (It's worth noting that as public editor, I have no inside knowledge on such corporate matters.) His integrity and decision-making are bound to affect The Times and its journalism - profoundly. It's worth considering now whether he is the right person for the job, given this turn of events.

All these questions ought to be asked. I hope The Times rises to the challenge and thoroughly reports what it finds. The Times might start by publishing an in-depth interview with Mr. Thompson exploring what exactly he knew, and when, about what happened at the BBC. What are the implications of these problems for him as incoming Times chief executive? What are the implications for the Times Company to have its new C.E.O. â€" who needs to deal with many tough business challenges here â€" arriving with so much unwanted baggage?

As the BBC has found out in the most painful way, for The Times to pull its punches will not be a wise way to go.

Using Crowdfunding to Start a Company With a Cause

Courtesy of braGGs Kara Gorski (left) and Kristin Gembala, sisters.

Two sisters, Kara Gorski and Kristin Gembala, have developed a bra designed to help breast cancer survivors who have had mastectomies and reconstructive surgery. So far, the sisters, who invested $25,000 from their savings, have designed and patented two styles and built a Web site. Currently, they are trying to raise money to begin manufacturing through a new crowdfunding platform.

For Ms. Gorski, a Ph.D. in economics with two children who works for a consulting firm in the Washington area, and Ms. Gembala, a stay-at-home mother with four children, the business - known as braGGs -
is persona l. Their mother died of breast cancer at age 39, when the sisters were just 7 and 12 years old. Twenty-eight years later, at age 35, Ms. Gorski discovered her own breast cancer. Soon, both sisters were found to carry the BRCA1 genetic mutation, which the National Institutes of Health says means an 87 percent chance of developing breast cancer and a 45 percent chance of developing ovarian cancer.

Both sisters elected to have surgery - Ms. Gembala prophylactically, since she had never been diagnosed with cancer. After hysterectomies and double mastectomies with reconstruction, the sisters expected to be able to wear regular bras. When they learned this was not possible, they set about designing and creating a reconstruction bra specifically for women like them. “So many women have told us about the serious problems with trying to find a functional and beautiful bra after such a difficult journey,” Ms. Gorski said.

Once they had pro totypes, they needed capital to start manufacturing. They started out pitching themselves to Kickstarter for a crowdfunding campaign and were turned down. Determined not to give up, the sisters reached out to a niche crowdfunding site, MedStartr, that specializes in projects and start-ups that involve health care. It was started by Mike Pence, who helped develop Kickstarter, and Alex Fair, an entrepreneur and health care advocate.

Mr. Fair said MedStartr was trying to do crowdfunding differently. “Kickstarter and Indiegogo are self-service for great ideas looking for funding,” he said. “Our customers need more help. They didn't go to business school or design school. They went to med school or graduate school. If they need marketing, we have P.R. people. If they need a video, we have video people. If they need help figuring out how their business model should work, we help them with that, too.” For now, MedStartr takes 5 percent of what is raised and offers the mentoring and marketing support free of charge.

The site helped Ms. Gorski and Ms. Gembala with promotion and partnership aspects of their project. Mr. Fair took them to make a presentation at the Department of Health and Human Services and connected them with a breast cancer support group, TalkAboutHealth. Ms. Gorski and Ms. Gembala were also provided with assistance in drafting press releases and driving daily traffic to the site, which resulted in more than 7,000 people watching braGG's pitch video.

Before posting their pitch on MedStartr, Ms. Gorski and Ms. Gembala considered how much money they would need to begin manufacturing. “We struggled a lot actually in deciding how much to ask for, teetering between $5,000 and $10,000,” Ms. Gorski said. “We did the math and knew financially we needed the $10,000 to get us through a first manufacturing round, so decided to go for it.” Their goal was to raise $10,000 by Oct. 1, which they did, but MedStartr is allowing them to continue their campaign until the end of October because it is Breast Cancer Awareness Month.

For those interested in trying crowdfunding, Ms. Gorski and Ms. Gembala offered the following advice:

Use social media: Get your audience involved and invested. Ms. Gorski explained how they got Facebook fans and Twitter followers involved: “BraGGs bras have hidden messages of inspiration inside to make women feel special and confident through their day - a little hug from us to them. When we were deciding on which messages to include, we put up four options on Facebook and Twitter and had everyone vote.”

Video is crucial: Explain what problem you are solving and how you will do it. Ms. Gorski said it is critical to explain how much you are asking for and how the money will be used.

Tell a story: Being passionate about your story will make others passionate about it as well. “They will want to become invested in being a part of someth ing great,” Ms. Gorski said.

Melinda Emerson is founder and chief executive of Quintessence Multimedia, a social media strategy and content development firm. You can follow her on Twitter.

My AdWords Debacle: A New Product

Although I didn't realize it at the time, the trouble I started to describe in Monday's post began at the end of 2011. That's when we got a call from a client for a low-cost, modular, folding table. This is a particular configuration of conference table that we weren't making at that time, mostly because the best solution to the problem involves using metal components that we cannot fabricate in my factory (which concentrates on woodworking.) But we had been getting a steady stream of calls for this type of table, and I decided that we should put some effort into developing our own version.

We found a manufacturer of table components, based in Michigan, who had a particular leg design that we could use with our own top s and base parts. This leg had a very nice folding mechanism. I ordered one to see whether it was as good in person as it seemed online, and we built a prototype. It worked well. We were even able to engineer a way to include power and data capabilities - a tricky design problem, which is why most makers don't include them in folding tables. We showed the prototype to the client, closed the deal, and made the first batch.

The manufacturing times were acceptable, so I put the new product up on our Web site, with pricing per table of $1,594. When I first posted the table, we had the price prominently displayed at the top of the page. If you read the body text, it was clear that we were talking about each table in what would most likely be a multiple table order, but a quick glance at the whole page, with the picture showing four tables, left the impression that you could get a set of four for under $2,000.

Now, there are lots of cheap tables that are in that price range, but we don't really cater to people with that small a budget. Given the costs of our design and selling process, I consider $5,000 a reasonable minimum order. Our average order is closer to $15,000. In my mind, I was happy to add a new product to our line that hit a low but acceptable price point (in the quantity that most people would need, four or more) and that would serve as a starting point on further developments of that type of table.

We had been making modular tables previously, but most of them were large and complicated. While we had a page of our site devoted to them, I was not targeting them specifically with their own keywords or ad group. I decided that, with my new economy model, I would take a fresh look at this. Using the Google Keyword Tool, I found that “modular tables” was a very high-traffic search string. Great! So I generated a new group of keywords around that concept, set them up with their own ad group and started driving traffic to our Modular Tables page. Greeting visitors at the top left of the page was our Folding Modular Table, with its low, low price of $1,594 (per table) prominently displayed. I did all of this on Jan. 5.

A few weeks later, I went back to see how the group was doing. Basic ad group maintenance requires checking how many e-mail inquiries we get, whether the click-through rates are comparable to the overall campaign, which keywords generate the most traffic, and whether the ads are being triggered by searches that are relevant. For instance, we have an ad group called “Big Table” that was aimed at people looking for really large tables but was also triggered by people searching for information on a particular type of barbecue called the Big Green Egg.

Apparently, the Big Green Egg is an awkward shape, and lots of people want a custom table to hold it. There is a lot of search traffic around this concept, and a significant number of peo ple would click our ads. These clicks cost me money but do not result in any sales. Google's robots, however, see these clicks as perfectly successful, so they continued to serve our ads until I turned all Big Green Egg searches into negative keywords. Establishing effective negative keyword lists for each ad group can be done only after running them for a while and wasting a lot of money. Believe me, you can not predict the irrelevant search strings people will come up with.

After a month of running the Modular Table ad group, things were looking good. Not only were we seeing decent stats for the ads, we were also starting to get a significant number of calls about lower priced modular tables. Success! I had developed a new product, supported it with advertising, and now the calls were coming in. With a healthy inquiry pipeline, I turned my attention to our sales process.

Inquiries come to us in two forms: either via e-mail or as a phone call. In either case our response was the same. We have a list of 10 questions that allow us to make a recommendation for the client. The questions are designed to reveal the functional aspects of the problem - that is, they concentrate on things like the desired size, the desired number of users, the size of the room. Functional stuff.

When we feel we have enough information, we prepare a proposal, a pdf document that contains images of the options we recommend and information on wood choices, power/data options and pricing. The proposal, I believe, is an impressive piece of work. I had come up with the format over years of interacting with clients and designed it so that it explained itself. My theory is that the document needs to be something that can be sent from person to person in an organization and understood regardless of whether I am there to explain it. I did it this way because many of our transactions are done through relatively low-level people who pass the information on to the decision makers. My other theory about selling was that this document needed to be produced quickly. We could turn one of these around in less than two hours if the job were simple and within 24 hours even if the job were complicated.

This system - get a call, make a proposal, send it off and hope - actually worked pretty well for many years. I created the basic format in 2007 and didn't change it even through the downturn or the recovery that we experienced in 2010. In 2011 we broke all of our previous sales records and made money to boot. As spring of 2012 approached, it looked as though we would repeat that success. Incoming inquiries were strong, and my two sales engineers were churning out proposals in response. The numbers looked fine, and I was confident that success was assured. But I was about to find out that a high level of sales activity doesn't necessarily guarantee results.

Wednesday: The metrics I track and the stories I tell myself.

Paul Do wns founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.

Contradictions and Confusion on an Agreement With Iran

The lead news article in Sunday's Times raised questions for a number of readers, who were either puzzled or angered by its apparent contradictions.

In the “bulldog” edition, published Saturday afternoon, The Times reported that Iran and the United States had agreed to one-on-one negotiations over Iran's nuclear program. The news â€" certainly a major development on a hugely important subjectâ€" was attributed to unnamed Obama administration officials.

In subsequent online editions and in the late print edition, which now appears on NYTimes.com, new information was added to the article, and here's where the confusion began. The White House now denied that an agreement had been reached. So the words “in principle” had been added to the first paragraph to describe the agreement, and a White House spokesman, Tommy Vietor, was quoted denying there was an agreement.

(If you want to see the different iterations of the story t hroughout Saturday, visit NewsDiffs.org.)

By Monday's paper, both sides â€" the White House and Iran's foreign minister - were officially denying an agreement.

Readers wanted to know a few things: Is this story for real? Is there indeed an agreement? Whom are we to believe?

I posed the questions to the executive editor Jill Abramson, who called the Sunday story “solid and true.” She said that the White House was “hair-splitting” when it denied that there was an agreement, and that information was added to the original article to reflect the denial while still standing by its original reporting.

“Good journalism practice sometimes involves changes between editions. We did not see these changes as significant,” Ms. Abramson said.

Complicating the issue is that the reporting is based on unidentified sources, described only as “Obama administration officials” or “U.S. officials.”

One reader, Bill O'Fallon of Brentwood, Tenn ., expressed his reaction this way:

Who are these “U.S. officials?” How strong are the sources? Strong enough to contradict Mr. Vietor? Who shall we believe in this obvious contradiction?

The prominent display of the article, and Ms. Abramson's answer, says that there is indeed an agreement and that the denials are relatively unimportant.

A former foreign editor of The Times, Bernard Gwertzman, was another who wrote, calling himself an “unhappy reader.”

I would like The Times to be more specific. Is there an agreement or not? If there is, the White House is lying. If there is not, The Times is guilty of overplaying a phony story.

When newspapers use unidentified sources â€" as sometimes they are justified in doing â€" they say to the reader: “Trust us. We know what we're talking about.” And that trust is earned over time.

The more information about the sources that can be includ ed, the more the reader has to go on. It makes for a more transparent and far better process.

It's unfortunate that there wasn't much information offered about the unidentified sources in this case. While that may not have been feasible, the result of the vagueness is that it puts the reader in the position of not knowing quite what to believe.

The Megawatt Hour Responds to Reader Comments on Its Web Site

In my last post, Deirdre Lord requested - and got - reader feedback on her start-up's Web site. During the last meeting of the She Owns It business group, Ms. Lord talked about how helpful she found many of the comments.

One of her main goals in soliciting feedback was to learn whether the site helps a general audience understand what her company does. On that count, the Megawatt Hour's Web site seemed to succeed, she said. “It is clear what you do and how you do it,” said one commenter.

Ms. Lord was especially thankful for the specific advice she got. One commenter, for example, urged her to add language that describes the “magic bullet” her company offers - what can it give customers that no one else can? “We give customers access to their own pricing model - no one else does that,” she replied. Adding that “magic bullet” language will probably be one of the first changes she makes. “It's pretty easy, as long as the layout doesn't change dramatically, to add one sentence about how we're different,” she said.

She also appreciated a suggestion that she move her video to the left side of the page, because people read left to right. This same commenter noted that Ms. Lord's voice in the video sounded very dry and not at all passionate. “It's true, I've heard that about my voice since I was 12-years-old,” Ms. Lord said, adding that the comment “was delivered very thoughtfully.” To ensure that her passion for her business comes through, she is considering hiring someone to do a voiceover through VoiceBunny, a start-up that uses crowdsourcing to find voiceover talent.

Some comments raised issues the Megawatt Hour had planned to address “at some point,” she said. The Web site's use of the color gray was one. She said it was chosen in an attempt to differentiate the Megawatt Hour from other energy-related businesses, which tended to use blue and green on their sites. “We don't want to look like everybody else,” she said. “But it's probably true that the palate is not perfect.”

“Changing the palate is relatively easy as opposed to changing the layout or the content,” said a group member, Jessica Johnson, who owns Johnson Security Bureau.

Ms. Lord agreed. She added that the Megawatt Hour spent most of its time and resources on the platform that sat behind its site. The success of the business, she said, depends on that platform. “Our business won't sink or swim based on the landing page for this Web site, but it's important that people get past that landing page to our actual platform.”

“What do you think your competitors will think or do as a result of seeing t he post and the feedback you've gotten about your Web site?” Ms. Johnson asked. The Megawatt Hour considers energy brokers and consultants to be competition, although they operate on a different model.

“I'm not sure, but I don't feel like we exposed any kind of major weakness or any great secrets,” Ms. Lord replied. “Having any clarity around these issues is a big step up for our customers and sets us apart from our competitors.”

In future posts, we'll catch up with all of the business group's owners and review additional sites. Alexandra Mayzler, who owns Thinking Caps Tutoring, and Beth Shaw, who owns YogaFit, are redesigning theirs.

You can follow Adriana Gardella on Twitter.

My AdWords Debacle: Dumb and Happy

Courtesy: Paul Downs Cabinetmakers Paul Downs: The first two months of 2012 were great.

I'm going to tell you a story. It's a narrative that is built around a set of facts and events that happened over the last six months. I am starting with this explanation because, in the end, the problem I confronted was how to understand what was going on. And I'm still not certain that I really know what happened.

Here's the broad outline: In the spring, we stopped getting a certain kind of customer inquiry for the conference tables we sell. At the same time, sales started to contract with alarming speed - to the point where June of this year was the worst sales month I have had this decade. In June and July, I made a number of changes to my Google AdWords campaign and now incoming inquiries and sales are back where they should be. But I'm still nervous. I haven't paid myself since April.

Those are facts. What's trickier is to see how they relate to each other, and whether my reactions to the events as they unfolded were as good as they could have been. It's possible that all of my worrying, all of my hours spent thinking about what was happening, and all of the things I did were irrelevant. Reality is uneven, after all. Sales go up and down for reasons that are beyond my control. I'm ostensibly in charge of my business, but how much control do I really have? Maybe not so much.

But a boss has to act. I was confronted with an issue and I was going to do something. So here are the details. They are complicated, so this story will play out in five blog posts. You can be the judge as to whether the narrative makes sense and whether I did a good job.

Let's start at the beginning of the year. The first two months of 2012 were great. We had finished 2011 on a high note, I had money in the bank, and sales for January and February were strong. I was convinced that after many years of struggle, I had finally figured out how to run a profitable business.

My two sales engineers were closing deals, to the extent that I felt that I could ease myself out of the selling side of things and take a look at other issues. One of the items I turned my spotlight on was our Web site. I hadn't updated it in the previous months, because it seemed to be working well - we were averaging 16 inquiries a week through the first eight weeks of the year, as opposed to an average of 12 per week in 2011.

As I have mentioned before, we rely on Google AdWords as our primary source of customers. It's a very cost-effective way to drive traffic to our site. I've been participating in the program sin ce 2004, and I feel I have a good grasp of the basic principles of how to choose keywords and write ads. If you aren't familiar with AdWords, here's how it works:

Keywords are the base units of AdWords advertising. A bunch of similar keywords can be organized into an ad group. If you sell more than one product, it's a good idea to have more than one ad group, as there will be a wide variety of keywords, related to potential searches, that can describe your product.

A group of ad groups is called a campaign. When you start with AdWords, your first step is to make a campaign, then add keywords, then organize them into ad groups. When I started with AdWords, I began with several campaigns that had to do with residential furniture we were making. I had one for dining room furniture, one for office furniture and one for bedroom furniture. Eventually, in 2006, I shut down all of these and replaced them with one campaign focusing on conference tables. It wasn't very wel l designed, and my Web site at the time wasn't very good, but it still produced sales.

In 2009, I replaced my site with a better designed version and replaced the old campaign with a new one that reflected what I had learned about the different types of conference tables that people buy. I called that campaign “Long Tail,” after the marketing concept that encourages extreme specialization in one's product line. It contained a large number of ad groups. Each ad group was designed to show a very specifically worded ad to the viewer. For example: if people search for “black conference tables,” they are shown an ad that has “black conference tables” in the headline, and they land on a page with - you guessed it - black conference tables. We buy lots of keywords (553 as of today) and organize them into lots of ad groups (66 as of today, 59 at the beginning of the year).

AdWords is an auction. I tell Google how much I am willing to pay for my ad to appear a t the top of a page of search results, and, if no one else bids more, my ad shows up in the No. 1 spot, at the top of the page. If one person outbids me, I'm in the second position. If two outbid me, I'm in the third. And if three outbid me, my ad is shown at the right side of the page of search results. (It's actually more complicated than that, as Google wants to make sure that the content shown in the ads is relevant to the search, but I won't go into that here.)

The first and second positions are by far the best places to be. It's well known that people rarely click the other ads as often as they do the top slots, which is why I'm willing to bid high to be at the top. Each time someone clicks on my ad, Google charges me money. It's expensive. The average cost per click for all my ads is $3.51. That may seem like a lot (a topic The Times covered recently), but I sell a pricey product, so it's worth it to me.

I can set limits on how much I spend per day. I des ignate an amount that I am willing to spend for my entire campaign, and each click on any of the ads in my campaign uses up some of that amount. At the beginning of 2012, my daily budget was $475. Most days, I use up the entire budget. As soon as all of my money is spent, Google stops showing my ads. Someone else's ad will appear where mine had been. I may still have a presence on a given search page, as a link to my site may appear in the unpaid, or organic, search results. But as I demonstrated last year, those free links don't produce nearly as many inquiries for me as AdWords does.

So in January and February, my campaign was generating 16 calls per week, and my sales were great. We were hitting my target of $200,000 in revenue a month. But I was about to make a terrible mistake.

Tuesday: We introduce a new product and the trouble begins.

Paul Downs founded Paul Downs Cabinetmakers in 1986. It is based outside Philadelphia.