Share Ad Expenses to Boost Profits

The challenges of the small business owner are well documented. They must battle for market share against larger competitors, run all aspects of their business, and even pay higher rates for advertising and other marketing related expenses. Small businesses generally do not qualify for volume discounts when it comes to buying advertising space or marketing materials, and thus they end up paying higher rates for the same ad space or marketing materials purchased by their corporate counterparts.

In recent years, there have been some changes in the marketplace that are of benefit to small business owners. For example, Internet procurement sites have emerged offering discount rates on everyday office supplies such as toner or paper. However, the high cost of advertising has not been formally addressed. That's why many small businesses are taking matters into their own hands and joining forces in marketing "co-ops".

Here's an example of how it works. Andy's Accounting Firm and Larry's Legal Firm are both small businesses operating in the business-to-business sector. Andy services small businesses with their accounting needs, and Larry is a lawyer specializing in small business issues. Andy and Larry both wish to purchase advertising space in a popular small business magazine. The rate they are quoted individually is $5000 for the back page of the magazine. Since they are not repeat advertisers, neither Andy nor Larry receives any kind of discount. So how do they save money on this advertising venture? A co-op approach on one of two fronts will cut their advertising costs significantly:

Share the ad: Since they are not direct competitors, Andy and Larry could split the ad space 50/50, acting almost as if they were partners although their businesses are distinct. This drops the cost to $2500 for each business and they still receive broad exposure in their chosen publication. In fact, by putting their heads together they should be able promote their collective business expertise as "Total Solutions for Small Business".

Purchase separately at a discount ? There may be some occasions where a business does not wish to share its ad space. Even in these cases a co-op approach can offer a lower cost. Andy could call the publication and ask for a quote on the back page for next month. Once the price of $5000 is quoted, he then offers the publication a deal "What if I bring on another advertiser for you. Would I get a small discount?" Most publications live or die on the sales of their advertising space, and are usually willing to offer someone like Andy a 10% discount for bringing someone like Larry in to purchase an ad elsewhere in the publication. Andy and Larry split the savings and Andy ends up paying $4750 for a $5000 ad. Although the savings were smaller in this case than the shared ad example, remember that Andy now has the entire back page to himself and saves $250.

Advertising is not the only example of co-ops at work. Web Designers would jump at the chance to line up two clients in one shot, and would likely offer a discount to do so. The same applies to a printing company that prints brochures or business cards. The possibilities are endless, including the size of the co-op you choose to join.

When faced with a major advertising buying decision or the need for new marketing materials, find out how much you will have to pay as a small business. Then form alliances with similar small business, and negotiate a better deal for all parties involved.

About The Author

Will Dylan is the Author of Small Business Big Marketing and owner of www.marketingyoursmallbusiness.com. Will also offers article and news release writing services through his website. You can contact Will at [email protected]

In The News:


Small Business Essentials: Start Here

Thinking of starting a business on line? If so there... Read More

Look Out for that Great Accountant

There are many factors to be considered when you are... Read More

Build Credibility with Expertise

As an Investment Representative you've worked hard to build trust... Read More

Is This The Way Its Always Been Done?

Let's face it, we all tend to get stuck in... Read More

Employee Induction - Are you Inducting your People - A Practical How To

In today's fast paced marketplace it is easy to neglect... Read More

Retail Customer Opportunities for Pressure Washing Companies

Pressure washing companies must look for customers in the retail... Read More

Joint Venture Your Way to Extraordinary Sales!

You know what makes me really happy? Drinking a Starbucks... Read More

Computer Related Habits From Small Business Owner - Be Prepared, Avoid Despair

Aside from the fear of losing a spreadsheet or research... Read More

How to Integrate Yourself in Someone Elses Business

When do you need to get more involved with the... Read More

How Most Business Owners Sabotage Their Success

Owning a business is a challenging endeavor. If you're like... Read More

How to Create an Information Plan

What is in an information plan?Before you even meet with... Read More

Starting Your Small Business

Where do you find more customers?How do you compete with... Read More

One Of The Best New Business Opportunities May Be Right In Your Home - A New Daycare Business

The day care industry is expanding. There are now more... Read More

How Is the LEGAL SYSTEM Dishing Out JUSTICE in Your Town?

Thankfully, most of us will never find out. That is... Read More

How to Give FREE Advice and Make Money

When is advice free and when should you charge for... Read More

Four Reasons Why Small Businesses Succeed (or Fail)

The American system of business management has been admired and... Read More

Small Business Marketing, According to Seinfeld

What could Seinfeld possibly have to do with marketing a... Read More

10 Filler Activities for the Summer Business Slowdown

Summer is a time for the outdoors, for that well-deserved... Read More

Starting An E-Commerce Business: Baby Steps

Starting your own e-commerce business can be quite the adventure.... Read More

Old Data in Database Marketing Software

Database Problems in MarketingI have been working on a direct... Read More

How To Write A Business Plan

Writing a business plan is a fundamental step to ensuring... Read More

Eight Key Steps to Selling Your Business and Cashing In

This year, some 700,000 American businesses will be sold. Most... Read More

Small Business Marketing - How Important Are Your First Words?

"What do you do?" It just might be one of... Read More

Three Big Barriers To Small Business Marketing Success

When you feel like you're always busy working on your... Read More

Get Approved for a Franchise

Deciding to start your own franchise is just one of... Read More