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hi, there, everyone. i'm j.j. ramberg and welcome to "your business," the only television show completely dedicated to small businesses. how many failure point do you have in your business? if one thing falls apart, a supplier doesn't come through, an employee quits, what does that do to your company? i traveled to visit an owner of a paddle board company to find out exactly what happens when something goes wrong. mike mudd, the owner of the oregon-based paddle board company based on liquid was on vacation in mexico when he had

received information that threatened his business. >> it's like a dear john letter. a manufacturer in china informed us that a container that probably should have shipped two or three weeks before that had been all burned up. >> it was one of the worst messages he could have gotten. he was expecting a shipment of his bestseller. instead he found out his inventory was just destroyed in a factory fire. his stress level went from zero to 100 in seconds. the timing could not have been worse. they were preparing for the start of what they call the silly season, the four months that most paddle boards are sold. >> getting these boards in august or september, it's too late. we would have lost a tremendous amount of opportunity to sell and maintain margins and keep the company profitable. >> on top of that, mike had just brought on a new partner who had just made a big investment in the company. >> i was mortified.

i thought maybe he would contact legal counsel and say i don't know what he got me into. >> not getting boards in time would be major glow to the company mike and his wife had started three years earlier. lifelong outdoor enthusiasts they opened the paddle board store in what they thought was a growing trend. how big was it compared to now? >> i believe at the time the sport was the fastest growing water sport and now it's just the fastest growing sport. >> with a front row seat to this explosive sport, mike saw an opportunity. >> we could double our margins and become profitable. >> did you fill a hole in the market that you saw as a retailer? >> well, yeah. a lot of the nicer boards, the boards we manufacture ourselves are $200 or $300, $500 less than most of our manufacturers.

>> the board i got last year was the 11-foot board. there's a few scratches but the durability is amazing. >> the popularity had grown and by the time mike got that call in mexico, he had promises to deliver to retail stores across the country. >> we would have let down, you know, our new retailers, hey, sign up, don't have anything for you. >> mike's options were not looking good. he had already paid the factory in advance for the boards that were destroyed, and the factory was supposed to have already started on a second shipment of boards, which they hadn't yet. >> i was trying to come up, you know, with a strategy that was going to be appropriate, and all of them seemed like they were very high risk. >> though he had not expected so much to go wrong so quickly, mike had known that something like this could happen. he had just one manufacturer providing these premier boards and he was never comfortable with the lack of

diversification. so a few months earlier he had started conversations with another overseas factory. >> they already had all of our files, all the graphics, they already knew all the pricing. >> mike quickly ordered a container of boards from the new factory and doubled down on the old one paying extra to make sure the lost boards would be replaced immediately. >> i said i'll go ahead and wire additional funds. you'll build us two orders at the same time. i kind of bought our way to the top of the schedule. >> it was a big risk, tying up all of his money, crossing his fingers that everything would get there on time. otherwise it would turn into a big hit for his balance sheet, lots of expenses, little sales. >> it would have been, you know, a terrible year. we would have written a whole year off of work. >> it was a gamble that paid off. by june 1st, mike had his complete lineup and a more diversified manufacturing process for going forward just in time for him to take advantage of the silly season.

creating and running a startup small business is challenging enough, but at least you're starting off with a clean slate in the eyes of potential customers. but taking a company with a well known brand that's failed and then turning it around can be particularly daunting. as nbc's jenna wolfe reports, one entrepreneur has done just that with her hat store and in doing so became the youngest woman to own a hat facility in new york. >> to kate middleton's saucer to pharrell's hat, it's made a comeback. it's personalized statement and one size fits all mentality, they're now revealing a lot. >> it took me 30 minutes to do what he does in a matter of seconds. >> this is the owner and found over the company, a new company with a very old and rich history. frank sinatra, bill cosby,

madonna all frequent customers in years past. a year ago when the former cat company went belly up, it seemed like the end of an era, until a young woman with an old soul came along and changed the landscape. >> when you see the process of making a hat, this is nothing to what it turns out to be. >> back in 2010 she took up a hobby, hat making. after finding out her mom was seriously ill, she decided to make her a hat when she complained of the cold nights. one hat led to two and three and so on. >> i was looking at this apartment filled with handmade hats i kind of made a decision that it was my time. >> that time is now. after raising $172,000 on kickstarter and borrowing from family and friends, she who just four years prior was making hats in her bedroom bought herself a hat company for a bargain price.

>> through the process i knew it would work, i had such faith. i knew i was going to figure out how it happened. >> at age 31 she became the youngest female factory owner in manhattan, a tour of the cleanup factory which sits behind the showroom is an eclectic mixture of past and present, new and old and new again. >> what is the most popular hat someone will come in and ask for. >> indiana jones. >> 25 blocks from the old factory and now new textures for any hat imaginable. a story that started with her mom who's doing well today and continues on as satia tosses her hat in the flair of fun off the carpet and off. >> ifky inspire somebody to feel magic when they wear hats, i am successful. >> today's elevator pitcher is another new york city entrepreneur with a sense of

style. let's see if her closet consignment concept convinces the great panel tomorrow. former sba administrator who's now the ceo and tania, the found err and ceo of sharably. >> hi. we're an online luxury and fashion consignment business. being a normal i know that time ask a valuable commodity at all. taking the effort to shop for sales is simply out of the question. kate's closet is changing that. i use my kengss to get the best possible deals for my customers. all of these products are then sold through my website, ka katesclosetnyc.com. we looking for an exchange of

20% in our company. we'll use this with acquiring new inventory, hiring a new sales team. please check out our website katesclosetnyc.com. >> you had me at no time to shop. how do you think she did. i want you guys to say the pitch from one to ten, how was it? and i got to say you've got your p.r. down. so, tania, i'm going to start with you. from one to ten, how was the pitch? >> i'm going to go with an eight and the reason is also as a customer, i'm very excited by the concept. thinking about the pitch, though, i would challenge you to really help me understand how you're different from all of the other solutions online. i think you referenced your experience and that was strong, but i didn't understand with the actual business how you were going to really stand out. >> okay.

>> all right. steve. >> i gave you a nine. i thought it was terrific. i have three teenaged daughters and a wife. they're all very discerning shoppers so it spoke to me. like the idea how you talked about where you were getting your materials from, who was buying, where the plun was going. it gave me a lot of visibility to that. i also wanted to know what it looked like compared to the competition. >> i think the growth numbers were exciting too. thank you very much for coming and pitch and good luck with everything. >> good job. >> thank you for giving your vienlsd scores and you stick around. now, if any of you have a product or a service and you want feedback from our elevator pitch panel on your chances of getting interested investors, send us an e-mail. the address is your biz a

business@msnbc.com. how you present yourself and what you sound like is just as important. and with many more meetings happening with services like skype, your body language and your quality of voice has even more clout than in the past. that's why i recently sat down with susan berkeley, ceo of the great voice company to find out three things you can do to make sure you're representing your brand in the best way possible when you're meeting with people. so i know people have been doing a lot of webinars recently, and 1-800-of the tricky things, they're used to presenting in a room. on a computer they don't know who they're talking to. do you have any suggests on how to make it more physical? >> an avatar is yore ideal

customer. this was the owner of a tech company, 55 years old, a white male. so we gave all the people that are doing webinars in that company a physical representation of that. we took a picture and we gave that to them and that helped them. >> you put that on your computer and you know who you're talking to. >> that's right. it takes away the feeling like you're presenting into a black hole. >> so the next thing you say not to do i do all the time, and i know people do it to me, which is multi-task, and it's terrible habit. >> isn't it? it's time to break that. >> look. i'm holding my phone now when i'm talking with you. >> the tendency is when you're in the middle of a skype cal or w or webinar, you've got one eye on the phone. what happens is people hear that in the sound of your voice. you sound diskinected and distracted. >> and then finally warm up your

voice. >> yes. >> as if you're about to go do a play on broadway. >> we actually speak more than an actor might in a two-hour play. i mean most of us are on the phone more than two hours day, so it is really important to warm up your voice for two reasons. so sounds richer, warmer, more resona resonant, and also so it doesn't give out on you. lit me give you some vocal warmups, j.j. get your voice into a faishl mask so it sounds like this. mm, one. >> mm, two. >> mm, two. what this does is makes my voice sound richer. >> right. by doing this you're bringing your voice forward so it has a chance to res nant. >> so it sounds deeper, more authoritative. >> and it's more healthier. some speak with a glottal, like

that. don't do that. get into a warm shower. that will help you. another thing that's fun and sort of silly is like this. brrrrr. >> brrrr. >> not everyone can do that. that's a great way to warm your voice up. >> if you have babies, you can do that. so if you think of that, people think of as actors and actresses do and maybe professional speakers but all of us should be doing it. >> that's right. we're talking more than a radio person. we're on the phone, five, six hour as day. your voice can give out on you. >> and, again, your voice is what they will hear and they'll make an impression on the rich tones. it has a lot to do with it. >> it's your voice brand, that part of the company. we pay a lot of attention and almost no attention to our spoken image. very important to train, everybody. >> when we come back, steve preston talks to us what you

need to know about complexities of trade compliance that could put your business at risk. and we'll grapple with the question of growing too slow or growing too fast. if i can impart one lesson to a new business owner, it would be one thing i've learned is my philosophy is real simple american express open forum is an on-line community, that helps our members connect and share ideas to make smart business decisions. if you mess up, fess up. be your partners best partner. we built it for our members, but it's open for everyone. there's not one way to do something. no details too small. american express open forum. this is what membership is. this is what membership does.

your business plan. everything is thought out. if you have a good business plan, well thought out for two or three, you can start to follow that plan in an orderly fashion. you might stumble or trip or fall in a gully, but if you have plan, you can get up and continue on your path. >> it's time now to answer some of your business questions. steve preston is back with us as is tania yuki. the first question is from an n entrepreneur who's ready to raise capital. >> what are the fund mental metrics, things we should have in place before we start going out and looking at alternative outside financing sources. >> good question. all right, tania, let's start with you. >> the biggest thing is making sure you have your finances in order. it sounds like you'll be looking

through institutional money, which means they're going to want to understand three years from now how you're going to grow and have those projections really clear as to why you're going to go out and coroner tn market place. so it's more about having things done but more about ensuring your vision and having the numbers to execute. >> anything else, steve? >> i'd add to that stability is very important especially in the lending community. if you're going to get dead capital, they're going to look very closely at can it support the debts. your cash flow to the total debt. they're going to want to look at the amount of your company, to debt to equity ratios. and the third thing, if things look difficult, they're going to want to know how they're going to get repaid. look at working capital and property. >> let's look at the next one. it's about how fast you should grow. >> we develop a lot of technology and we always talk

about is it riskier for funding or sit better to go slow and then the am pet tore comes in and steals a market share. >> i love this question. it's tough. i've been in this position. what's your opinion. >> i have a hard tiemt saying number the question is whether it's sustainable and whether you can handle it operationally. can you continue to serve your clients with excellence, can you handle all the back office function. all the things that made your business great, make sure you can do that. at the same time if you're going to take debt financing, make sure you understand how to operate within the parameters of the bank requirements, right? you need to be able to make your debt service payments but you're also likely to have a lot of cover namts. you want to make sure you can run the business. so know what you're getting into. >> i would add particularly the technology, landscape changes so quickly. i believe the risk of not growing fast enough is actually

far greater than the risk of not growing. it's not an incremental business. you need to step on the gas. you need to know the fundamentals and that your customers are growing. you don't want to have people a opportunity, you do want to fund it because otherwise your competitors will grab that space. >> as you were saying, high class problem to have. you're lucky if you near a position where you can get it. finally, here is a question about managing your company's sales. >> my company is growing in flee three different channels, online business, export internationally. my question is do you try to straddle and grow or do you just pick one and focus in on one? >> i love we have a lot of questions about growth today. this is a good sign. where do you focus? how do you decide? >> another wonderful problem. i'm a huge believer in focus on your core. pick one thing that you're really strong at. if it's the online business, i

think having a secondary channel is a really great thing. if they're all trending upward, this can be a tough choice. i believe particularly as a small business, if you try to focus to succeed in three different areas, you might be setting yourself up for failure. >> that is so hard, to turn down something that's working. >> there are three different areas. i think it's important to look at the three channels, how big is each channel, what's my potential profitability and also what does it take to be successful. if i'm selling direct to consumers, i need marketing presence, i need to be able to fulfill all those or defrmts i might need a call center. if i'm selling to wholesale, i'm going to have contracts with large buyers, but i'm also probably going to have lower pricing, more favorable payment terms for the buyer. if i'm looking internationally, i have to think about logistically how i manage the delivery of those goods and i have a compliance function i need to build to make sure i do things compliantly.

three different channels but different requirements. go into it with your eyes wide open, knowing where the value is but also what the cost and operational burden would be. >> i love this. basically lift the curtain. go beyond the numbers, see who do you want to be, where can you be successful going forward. these are great questions, great answers. thank you, guys, so much for helping out today. really appreciate it. if any of you have a question for our experts, all you have to do is send us an e-mail. the address is yourbusiness@msnbc.com. online, content is king. we've said it many times. but creating original material to post and get the word out can be time consuming and difficult on your own. why not enlist your followers. here are five ways you can engage your consumers to create shareable brand theme content

courtesy of matchable.com. the results can provide content you can use on other channels and will give you insight on current opinions on your brand. two, provide a personalized brand experience. implement a set of product or service choices that reflect the identity of your customer as revealed in their profile data. three, ask your fans for content. this makes them feel like an essential part of a brand. you can ask them to submit photos, videos or other stories on brand related theme. four, challenge the knowledge of your social audience. offer quizzes or polls that post questions where the answers are informative or useful. the results themselves can then become shareable content. five, help your followers uncover profile insights. provide ways for your audience to learn something about themselves by interacting with your brand. it's important for small businesses not to get left behind as the u.s. continues to

emphasize programs to stimulate trade with other country. here with some key questions you should be asking in order to expand your business beyond the border and stay competitive is steven preston. he joins us once again. >> good to see you. >> you started thinking about this while at the sba. tell us about what livingston is? >> basically we help companies who want to move thar products across the border do so. we help all the documentation and compliance requirements, freight forwarding and consulting. we also have a business where we actually outsource trade activities for clients. >> tell me some of the things you need to think about. i think in general it is so daunting. i am a small business. some people obviously are thinking about doing this. let's start from scratch. how do i get to the point where i can feel comfortable with even starting to think about it? >> i think one of the important things you can do is find a partner that can advise you.

that's one of the things we do in our business. customs brokers, we work through with our clients all the things they need to do to become compliant. certainly there is support through attorneys and other organizations that can help you. frankly, i think the most important thing to do is figure out whether you have a business opportunity overseas, whether a client or a vendor and then start thinking about how am i going to get that good or ship that good and then start are from there. once you have that, you'll be able to build the pieces you need. >> okay. let's take a different situation. i'm already doing it. what questions can i ask myself, am i doing something wrong? i'm sure a lot of people jumped into this and inefficiency is happening. >> first of all, time is money. if your goods hit the border and don't move quickly, you have delays. that might mean that components aren't showing up at a factory, goods aren't getting on the shelf. perishables are perishing. you might en kur logistics costs

and have unhappy customers. time is money. you want to make sure your goods are getting across the border quickly. >> don't just leave this to someone else. you better understand it all yourself. >> you have to understand it. even if you have somebody else do it, you're ultimately liable importing goods for your compliance. you want to make sure you're working with people that run a tight ship. >> and then costs. there are ways to get around some of the costs or reduce them. >> first of all, really understand whether or not you can take advantage of free trade agreements. nafta has been around for 20 years. most of us know about nafta, there are a lot of bilateral trade agreements with any number of countries that reduce duties. you have to comply with the requirements and demonstrate your goods qualify. >> how do i find this out? i work with a lawyer, need to know to ask the lawyer. >> exactly. you can work with a customs broker, work with an attorney. you need to be able to document

that your goods were sourced in a particular way that they qualify for trade agreement. >> now i want to go back to something you said before which is ultimately you are responsible. >> yes. >> you better make sure you are not doing anything to risk your company? >> that's right. if you have problems, there are fines, penalties, sometimes you can incur audits. if it's an ongoing problem, it can be more difficult to get your goods across the border. the border official can flag your shipments. >> again, you need to have partners you can trust. this is a big world and i don't understand it and i don't understand all the compliance issues and i put my faith into some partner. how do i continue to have faith that, okay, i trust them, nothing bad is going to happen here? >> i think if you're dealing with a good partner, they'll be able to show you clear indications of their record. they'll be able to show you the other clients they work with. perhaps they'll be able to show you if they've worked with the kinds of goods that you're

trading. many will be able to show their on time metrics and quality metrics because they'll keep those. there are ways to get the comfort. >> you do it with all kintds of people, you do it with your accountants -- >> reputation is very important in this business. >> steve, thank you so much. i know this is an area that a lot of people think, oh, i wish i could and haven't made the step or as i said, maybe doing it poorly. >> with the right partner you can streamline your operations and do it well. make sure you are doing it well. >> thanks so much. >> thank you. to learn more about today's show click on our website, openforum.com/yourbusiness. you'll find all of today's segments plus web exclusive content with more information to help your business grow. you can also follow us on twitter. it's @msnbcyourbiz. we're on facebook and instagram, too. next time, our main street usa series continues as we visit ft. collins, colorado, a town that realized the poshs of

cultivating a culture that would get customers to shop local. >> the city invested a lot into this downtown in the '80s. they established an urban renewal authority. i think that really kind of turned things around. >> find out how making their main street pedestrian friendly and offering big selections and an entertaining experience gave the ft. collins small businesses a competitive advantage over major retailers. till then, i'm j.j. ramberg. remember, we make your business our business. if i can impart one lesson to a new business owner, it would be one thing i've learned is my philosophy is real simple american express open forum is an on-line community, that helps our members connect and share ideas to make smart business decisions. if you mess up, fess up. be your partners best partner.

we built it for our members, but it's open for everyone. there's not one way to do something. no details too small. american express open forum. this is what membership is. this is what membership does. another government shutdown? vrnlths good morning and thanks forgetting up with us this sunday morning. the headline at this hour. more than 50,000 people in the san francisco bay area will be starting their day without power, this in the wake of a preliminary magnitude 6.0 earthquake this morning. it was centered six miles outside napa. the "los angeles times" says reports are starting to come in of gas leaks and some fires in napa. we will keep you updated with more information as we get it this morning. but