Thumbing through my new issue of the Robb Report, (today’s “Wish Book” for men), my eye was drawn to the article about a $50,000 mattress.

The article caught my eye because Linda, my wife, had just purchased a couple of new mattresses for one of our guest rooms, and a wave of fear momentarily ran through my body before monetary reality helped me “know” her credit card didn’t go that high and such a purchase was impossible. In any event, once captured by the article, I read it.

While it is always interesting to muse on the thought that the old $50,000 record price had been replaced by a $75,000 version, this was not the point that my mind began to focus on. Instead, it was the main lesson of the entire magazine. There are two economies going on in the world simultaneously. One is the economy of higher gas prices that spoil the whole day of many Americans who get depressed every time they fill up. The other, is the economy of the ‘Affluent,’ as marketing guru Dan Kennedy, labels the other group of people in the newsletter he writes on the topic each month.

There have always been economic differences in this country, and the world for that matter. We might wish that it weren’t true, but pretending otherwise is simply not to face the truth. It is also not the target of this article.

The point to focus on here is the lesson that, to the extent you can, now is the time to refocus your business on that group of people who can afford your products or services, or at least a certain segment of your offerings. If you don’t have a product or service that is targeted to this group, you should create one so that at least one area of your business is less affected by the weak side of the economy.

Here are some examples to consider:

· A doctor could have a high-end portion of his practice that offered special service and extreme physical checkups

· A car dealership could offer a concierge level for its high-end clients that had free car use, special waiting rooms, client appreciation days, and a breakfast club

· A funeral home could offer a special offering of wakes that included catering service, or special spots to spread ashes — like the top of the world

· A law firm could provide total annual service for a flat fee or a monthly continuity program. The same for a CPA or other professionals

· Retail stores could slot their offerings so a mattress company could have regular mattresses, but also a “behind the velvet ropes” display of the $50,000 mattress. . (Similar to the way Vegas Casinos display the $1,000,000 cash prize)

· A dry cleaner could offer pick up and delivery for customers of its monthly “Inner Circle”

· A barber shop could have a monthly membership club that offered special prices and services

· A pizza restaurant could offer “all Organic” or a Gourmet membership level

And in case you haven’t guessed, all of these examples have been done, and done successfully. How can you do it in your business? What way can you create a level of service or a higher price line of products that appeals to the economic group that is still spending? Answer this question for yourself and the price of gas won’t depress you as much.

Banking has always been tough before for Entrepreneurs, but in this economy you need to be alert and take extra precautions. Here are some new rules to follow to help your business keep flowing.

1. Get more credit cards. Yes, I know some people are advising against this because it could have an adverse affect on your credit score. I can argue about how that theory is wrong, but your credit score isn’t the important point today, credit is. The problem is that banks are raising rates on credit cards on any excuse they can find. Additionally, they are also freezing cap amounts and no longer extending credit. As you pay down the credit card, your cap automatically lowers. This gives you no more credit and makes that card worthless to you. You need to get more credit cards when you can so you have options if problems with your others occur. New cards often have low teaser interest rates for 6 to 12 months. We all know this can work against you when you hit the time deadline but in the meantime you can transfer balances on cards you are having rate spikes with today. Deal with today’s problems and then work on cures for the future.

2. Watch your merchant accounts carefully. Banks have the right at any time to pull out money for a reserve if they feel they need to. If you are counting on that money for operations, and all of a sudden it gets frozen, you can be in big trouble. The best recourse against this is to build a relationship with someone at the bank who works in merchant services, and the higher up you can go the better. The relationship isn’t a guarantee something won’t happen – because most of the banks are tied in with card processors and don’t do the work themselves. Nevertheless, you are better off with a bank advocate pleading your case then you are talking to the 800 number recording.

3. Establish more than one merchant account. Banks always want all your business but today you simply cannot afford to do that, or you may wind up with an account you can’t use – and it will take more than 30 days to get a new one. In the mean time, you can’t take new charges on your old merchant account so you lose lots of cash flow. Having a back up is an answer, and use both of the accounts for some of the processing each month so you always know they are working. Even then, alarms will go off when the account all of a sudden has more money running through it then the bank’s computers think is normal – but at least you should be able to explain that you are now using them for all of your processing, so that’s the reason for the spike.

4. Consider lining up one or more investors who are prepared to step in should you have a crisis. If your merchant account does get a reserve requirement slapped against it, you will eventually get the money so you could use that reserve for a private loan. I am not saying this is easy, but thinking about this and other resources before a problem occurs, gives you more time to act – because you know what you need to do and who you might call to help.

Just a reminder that all of us are allowed to check our credit report for free once every 12 months, from each of the three major credit bureaus: Equifax, Experian, and TransUnion.

It is a good idea because there are frequently mistakes in them that lower your credit score and as we all know, credit is tightening. Go to the web site I have listed, and you can order free from one, or all three at the same time. If you order one now, you can then order from the other two over the course of 12 months so you can view your credit more often. Order all three at once and you’re done for 12 months, which I don’t think is as good.

http://www.annualcreditreport.com

Congress is notorious for giving wonderful sounding names to new bills they want to pass just to fool the public who don’t read them. They are about to do it again.

Senator Kennedy and Rep. Rosa DeLauro are pushing the “Healthy Families Act”. Who could object to a wonderful name like that?

The bill requires any firm who has 15 employees to provide a minimum of 7 days of paid sick leave. I have no problem with that and have always had sick leave days in my companies. My preference is that you don’t come in when you are sick and spread whatever you have to everyone else. The problem with this law comes in the form of detail. The bill allows you to take the leave anytime and in the smallest increment the employer tracks payroll, and no notice is required. This kind of language would allow an employee to show up consistently late with no advanced notice, ultimately causing all sorts of problems with real staffing issues, especially in shift positions. An employer would have no retribution for such tardiness and disruption to everyone else.

There are other new bills coming down the pipeline, which impact our business. I encourage you to look beyond their names and see what the real affect they will have on your business. If you like them, great – but if you don’t, let your Congressman or Senator know they need to make some changes. To do nothing is a mistake.

It was the 3^rd of July, and I was on the front porch of my beach house unfurling my American flag and getting ready for the annual 4^th of July party bash.

Across the street, I noticed two neighborhood kids busily setting up a card table and lawn chairs in front of their house, close to the road. I had a sneaky suspicion I was about to spend some money.

I watched the kids for a while from a distance as they finished off a sign that I imagined announced what they were selling. One of the two took the sign across the street to set up for traffic approaching from the other lane. The older of the two gave hand signals indicating the direction of the placement of the advertisement. Occasionally, the voice of the older brother rose — indicating displeasure with the slowness of his younger sister.

I waited for awhile before I visited the booth because I wanted to give our young entrepreneurs a time to settle in.

“What are you selling?” I called to the kids from my car when I pulled up to the stand.

“Lemonade!” the youngest yelled back quickly, glancing at the large sign above their stand, wondering, I was sure, whether they had forgotten to proclaim the name of their product on the sign, or whether I was just a poor reader.

“Twenty-five cents a cup?” I inquired indicating that truly I could read.

“Yes, sir,” the youngest said, grinning from ear to ear and creating a picture Norman Rockwell would be proud to have painted. “Would you like some?” the child continued.

“Sure would,” I said, and waited for them to deliver the quickly-served plastic cup.

“How’s business?” I asked as my drink was delivered.

“Ok, we’re just getting started,” was the reply. “But we usually do great. We’ve got a good location on the main road, and our sign makes people stop.

“Have you done this before?” I asked, knowing the sound of experience I heard.

“Yes, sir. Every summer,” the youth replied.

“What’s the secret to your success?” I followed up, wondering if they knew what they were doing.

“Well, we smile a lot and act friendly,” she said, after a couple of prods from me to think about it.

“What do you do if someone doesn’t like your lemonade?” I asked.

“I’d give them back their money and pour it out,” she said, but added quickly with her salesman’s smile, “But I haven’t ever had anyone yet who didn’t like it.”

Our conversation sort of ended after that. I could tell she wanted to get back to her work, and, after all, I was an adult.

She took my money and tip and headed back to her stand to wait for the next customer to arrive.

My jaded side smiled and wondered whether our government regulators would require them to have a business license to operate their stand. Did the health department approve this operation, even though it didnt have a bathroom facility and they didn’t wear hair nets when they poured the lemonade? I knew their sign was in violation of zoning, and I’ll bet she didn’t report her tip to the IRS on her 1040. Yes, that was my jaded side, and forgive me for it.

My entrepreneurial side was proud — proud of the tradition that sets us apart from much of the rest of the world — the tradition that applauds the nation of capitalism and the start-up ventures which are the backbone of our economy.

I noted that even at this early age, Americans still know how to make money. More than that, they instinctively know what it takes to be successful in business:

1. Have a good product.
2. Find a good location on a main road
3. Advertise with a sign or other appropriate method
4. Smile a lot and act friendly
5. If a customer doesn’t like your product, give the customer back his money, and throw the product out

If you are looking for a formula for success, here it is from the hearts and minds of two pre-teens with a yearning for success.

Happy Birthday, America, I thought! Thanks for the opportunity you give us.

Cheap is not my favorite word when selling, but it is a marketing position and should always be considered for a loss leader or name capture if nothing else.

During this recession and economic pullback, price can have an appeal and if you can compete on that level than you should point it out loudly and even make it a competitive advantage.

A couple of interesting examples and how value can be successfully marketed is Validas (www.myvalidas.com) and InchWorm Shoes (www.inchwormshoes.com).

Validas offers to shave an average of 22% off your mobile phone bill by letting them analyze what you are currently paying and making some suggested changes. You can upload your bill and pay $5 for a report that shows a breakdown of usage, compares carriers, and makes other suggestions for saving money.

InchWorm Shoes is a clever example of problem solving. We all know the cost of shoes and for kids how fast they outgrow them. Inchworm Shoes has a special technology that allows you to increase the size of your child’s shoe by pushing a button and pulling on the toe. Shoes can grow in half size increments and can expand up to three sizes… now if they could just do that for men’s pants I’d save a ton.

Keep thinking about the benefits your products and services have and remember …price can be a successful one.