Author Archives: brian

Three Things NOT To Do When Starting a Business in Kona

There are very few business owners I know who have not failed at least once in business. I certainly have. In 2000, I had a website that was similar to ideas behind the condo listing sites like Home Away and VRBO. A lot of money went into the development of the website, but, alas it lasted a year and failed. That seems like ages ago, and since then we have seen countless business failures, and, thankfully, a lot of successes.

success vs. failure

Here are a few things we have learned helping hundreds of businesses in Hawaii over the years. Many of the ideas come from our business successes and failures, as well as the work we have done with other businesses.

  1. Don’t base your business on a singular technology or innovative product. People over-value what a piece of equipment or a product will do for a business. Sure, if your equipment is cost-prohibitive for all but the most highly capitalized individual, you might have a sufficient barrier to entry. This is even more true if the local market is only big enough for one of that kind of business.

    If, however, your equipment or product can be purchased relatively easily by a competitor, you will lose your advantage quickly. Likewise, if a customer can substitute your innovative product with another, you will have no marketing or pricing power.

    I remember several years ago when HD video was becoming the new standard. A video producer I know spent tens of thousands of dollars on a new HD camera. She was certainly an early adopter. It was very nice, but the rate of innovation with cameras made a camera with the same specs available for 1/5 of what she paid within two years. What was a technological advantage and a barrier to entry was quickly lost in a few years. Fortunately, video production requires a lot of human skills, so the business is still around.

  2. Avoid long-term leases. This is true for office/industrial space, office equipment, and vehicles. The average new business does not make three years, so be careful about a five-year lease on rental property or a long-term copier lease. Leases are contracts and for a new business leases almost always require a personal guarantee, which puts your personal assets at risk if you fail. Try to bootstrap everything you can at the beginning by starting lean and outsourcing everything you can until you are financially stable. I can’t tell you the number of times we have seen a business failure destroy a family’s net worth because of over-spending and lease commitments.
  3. Don’t rely on traditional marketing. Focus your marketing on people-to-people interactions. It’s easy to spend a lot of money on TV, radio and print advertising and get almost no return on your investment. We recommend that every new business invest in a good quality website, and then get out and start marketing face-to-face. If you have a consumer product, try to get in front of consumers at the Village Stroll, the local farmers markets and community events. In-store demos are great, too. This will give you honest and direct feedback about your products, which you can then use to refine your products and your marketing. You may love your product and think it’s the best thing since sliced bread, but the only confirmation of that is sales! If you are a business-to-business company, spend some time identifying key buyers and then go meet them.

There are, of course, hundreds of things that you need to do right to succeed in business in Kona. The three things above are things to avoid.

They may seem like common sense, but we find that entrepreneurs are some of the most optimistic, and dare we say, Pollyannaish people we know. That optimism and can-do attitude are great, but, at times, it leads us to believe that we can overcome all obstacles. The obvious is not so obvious when you are self-assured and wanting to take your business idea and make it real. Business is hard enough when you do everything right, so why not start out by avoiding some of the common mistakes?

Kona Impact | 329-6077

Think About it Friday: Do leaders or followers create movements?

This is one of my favorite TED talks. In only a handful of minutes, the speakers shows how some movements begin.

1. Are movements leader-driven? Well, at first someone needs to come up with an idea, but it is only a good idea when the second person (and 3rd, 4th and so on) validates it.

2. Is a leader be a visionary or is he just a lone nut? Again, it is only a movement when more than one person joins.

3. How can a leader get buy in from others? The key seems to be–at least in this video–acknowledging the second person and the early followers.

4. When is it a movement? Tricky question, but one could argue that it becomes a movement when the costs of non-participation are greater then the cost of participation. Or, at least when there is no cost to participation. We find that in a lot of social movements in the United States. At some point the cost of being against women voting became much higher then the cost of being for it, or at least being indifferent. Perhaps the same could be said of opposition to gay rights, civil rights, marijuana legalization and other big changes.


Five Tips for New Entrepreneurs in Kona, Hawaii

As the economy improves, a lot of people are thinking about starting new businesses or extending the reach of their current business. We probably meet at least ten new entrepreneurs at Kona Impact each month. Some have an old idea with a new twist while others are looking to create a new category of business in Kona online.

We are excited to see this increased level of new businesses in Kona for a few reasons: 1) we love to see people become owners of their own business. This is where wealth and jobs are created, 2) new businesses expand the range of products and services available in our rather isolated island in the Pacific, and 3) Small businesses are what keep Kona Impact alive!

After working with hundreds of small businesses in Hawaii, we have learned a lot about what an entrepreneur needs to do in order to succeed. Here are five:

  1. Get honest and direct feedback about your idea from people other than your family or friends. If you have an idea that is something we don’t have in Kona, you might be able to create a new category and do very well. That said, there might be very good reasons why nobody has done what you want to do before. You might be a genius, or you might be foolish. If others have failed at what you want to do, how will you be different? Do a lot of market research!
  2. Make a business plan. I highly recommend that new entrepreneurs contact the Small Business Development Center, a free and unbiased resource for business planning with offices in Kailua-Kona and Hilo. A few months of planning might save you years of wasted money and efforts.
  3. Get a good grasp of business law and accounting. Read at least one book on business law and one on business accounting. It’s not the most enjoyable way to spend a weekend, but you’ll be glad you understand the basics of contracts, employment law, incorporation, debits, credits and the reporting laws for Hawaii and the IRS. You can do a lot yourself, but if you’re uncertain seek out an attorney and an accountant.
  4. Immerse yourself in the business community. Join the Kona-Kohala Chamber of Commerce, Toastmasters, a business networking group or a service group like Rotary. The connections you make in these groups will provide invaluable support, mentoring and, perhaps, your first customers.
  5. Be prepared to go “all in”. By this I mean that you need to devote a huge amount of energy to your business, and that time has to come from your current schedule. When you see cars parked outside of office buildings on Saturday mornings, those are likely to be the business owners. Likewise, the first car in the lot and last one to leave is usually the owner. Be prepared to give up time doing hobbies, working in your garden or on your car. Say goodbye to hanging out as much as you do now: successful entrepreneurship requires work, a lot of work. If you’re not up for these sacrifices, you might not want to begin.

luck is not a strategy

There is nothing we enjoy more at Kona Impact than seeing someone take a great idea and make a business that supports his or her family.

Kona Impact | 329-6077

Why Your Social-Only Strategy is Incomplete

Marketing is much like putting a jig saw puzzle together; it is hard to see the big picture with only a few pieces.

We often see what I call the “Social Only” strategy. This is characterized by a business owner or employee relying on Facebook or Twitter for marketing messages. I also call this the “One leg table” strategy, as it can certainly be part of your business’ marketing strategy, but, by itself, it is woefully incomplete.

social only strategy

Here’s why you don’t want a social-only strategy:

1. Limited information. Facebook, Twitter, Instagram and the other social media systems allow for very limited information. For example, most websites will have five or more well-organized and easy-to-find pages of information about the business’ products or services; whereas, the social media platforms have small snippets of information.

2. Distractions. Facebook exists because it can sell ads next to and within your timeline. Some businesses I know have given up Facebook when they have seen their competitors’ ads on their timeline.

3. Not indexed by Google. For the most part, all the posts you make on Twitter or Facebook are not indexed by Google. This means that nearly everything you post on your social media pages is inaccessible (not “findable”) by people doing web searches. Everything you put on your personal website can, if done right, be easily found through a Google, Bing or Yahoo! search.

4. Closed community. Related to #3 above is the fact that your social media presence on Facebook is a community of people who have ‘liked” your page. While it’s great to keep friends and business that are already your clients informed of what you are doing, Facebook will not attract new clients as efficiently as your website.

5. Ownership. Your business only owns the content on these sites and it is at the whim of the site if they want to increase advertising, sell more of your data (already happens on a massive scale), change the design or just shut down. There is nothing you can do about it. In the era of startups and shut downs, investing heavily in a technology that might be here today, gone tomorrow is always a risk. I can name tens of media websites that have been shut down, resulting in millions of businesses losing their online presence quickly.

We often have clients that want to put Facebook, Twitter or Instagram links on their website. Why would you want to take people away from your website, where you are 100% in control of the messaging and content? Once you have someone on your website, don’t let them leave!

At Kona Impact, we use Facebook as part of our marketing strategy, but we have a few principles we follow:

1. Always put the content on our website first. We want people to come to our website, where there is a lot of information about our products and services. We then put the content on our Facebook page and link that to our website.

2. It’s not worth a huge amount of time. It’s easy to spend hours a day reading other people’s information and posts. I try to avoid that during business hours and just spend a few minutes posting our information. I suspect most people do this as well, which is another reason why you can have a lot of “friends” and “likes” but very little business.

3. Use Facebook ads! Yes, it’s a great ad platform as you can hyper-target ads to areas and to certain demographics. What’s bad for individuals and businesses, privacy-wise, is great for advertisers.

4. No social media references on our website or other marketing material. Again, I want people on my website, where I control all design and messaging.

I have been working in online marketing since the early days of online marketing. The things that remain consistently best practices include creating interesting, useful content and using that content to attract clients and establish credibility. It’s hard work, but a solid content strategy that gives you ownership and control of your information will provide excellent long-term value for your business.

If you would like some help developing a solid and sustainable online marketing strategy, give us a call

Kona Impact | 329-6077


Spotlight: Five Exceptional Locally-Owned Business in Kona, Hawaii

buy locally

We all like to say that we support our local economy and want to keep our money in Hawaii. In principle, it makes sense to buy locally as the money spent at a local business tends to stay on the island and make for a more vibrant and dynamic local economy.

Here are five locally-owned businesses that you can easily patronize instead of the big box retailers or the off-island owned chains. I’d contend that the prices are about the same or less and the service is far superior.

Gas – One my favorite local gems is the Queen K Tesoro, located across from the harbor entrance. Owned by a local family that does a huge amount of good in the community by supporting local athletics and several non-profits, this is my go-to gas station. I like the E-free gas and the store is always stocked with great snacks and even a salad bar.

Propane – Alii Gas and Energy Systems is the easy choice for home propane. Pick up your BBQ propane at the local hardware store; you’ll want to call Alii Gas for residential large tank systems and off-grid power options. The service is awesome and the prices can’t be beat. Best of all, your money will stay on island as the business is locally owned and operated.

Office Supplies and Furniture – Kona Coast Office Supply is not one of our clients, but we rely on them for specialty paper, general office supplies and office furniture. Their selection for many items is often much better than the big box stores, and they deliver their furniture set up and ready to use. If you have ever bought inexpensive office furniture at a big box store and then spent hours assembling it, you know that a low initial cost will result in a big cost of your time to set it up.

Auto Repair / Mechanic – Other than a visit to the dentist, taking your car into the shop is typically a high anxiety activity. The costs can be high, and since the modern car engine is inaccessible to most people, we feel helpless when our cars need servicing. Raymond at Precision Auto has been my mechanic for years, in fact, since the day I met him. Honest, budget conscious and very detailed are  what I like about him and his staff. Another great alternative to a chain or off-island owned business.

Pest Control / Termites – One of the things that come with our year-round great weather is a whole bunch of creepy crawly things. If you’re a homeowner, plan for termites making a meal on your structure. Mason Termite and Pest Control is a great family-run business on the island. With years of experience and an abundance of aloha, they should be high on your list.

At Kona Impact, we are all about helping small and medium-sized local businesses thrive. The big box stores and franchises almost never buy locally, and the profits from these businesses are repatriated to the Mainland. We know that the big box stores and franchises will never support us, so we choose to buy from and promote businesses that will strengthen our community.

Kona Impact | 329-6077


Will Google Ignore Your Website Now? Mobile-Friendliness

On April 21, Google rolled out an update to its search engine focused on mobile sites. Read more about it here: 

This will affect every business with a website—for good or for bad.

We have all come across a lot of websites on our phones that are nearly impossible to read because they are just a website on a very small screen or the formatting is wacky This can be very frustrating for the site visitors as they can’t view the information for which they are looking.

Many websites you visit on your phone are specially formatted for the small screen. For example, if you go to on your computer and on your phone, you’ll mostly the same content formatted for two different devices. There is a mobile version and a full-size version.

mobile website

To check your website for mobile-friendliness on Google’s tool:

Google’s new algorithm (the formula it uses to match searches with content) will now give preference to mobile sites when the user is searching through a mobile device. This means that a search for “kona snorkeling tour” on a phone and a desktop will most certainly give different results. A company with a traditional website and a mobile site is likely to have visibility for computer-based and mobile-based searches. One that has only a traditional website is likely to not appear for mobile searches.

What will this mean for businesses in Kona, Hawaii?

Well, if your business has anything to do with tourism, you are going to lose out on a huge amount of business if you don’t have a mobile site.

We estimate that over 50% of searches for tourism-related businesses are done on mobile devices, so a restaurant, tour operator, lodging provider or transportation company, is likely to be losing a tremendous amount of business if they do not have a mobile site.

Even a car mechanic, retail shop or service provider not focused on tourism will see a marked decrease in website traffic if it does not have a mobile site.

What can be done?

If your website is very old, it might be a good time to make a new website, while at the same time making a parallel, mobile-friendly version. An old car with new seat covers is still an old car.

If your website is fairly modern, we might be able to use what you have to create a mobile-friendly version fairly quickly and inexpensively. This is certainly less costly than starting over, and you will be able to be recognized by Google as mobile-friendly.

Crating a mobile friendly site for some websites might require more work.

The first step is to give us a call—329-6077-and have us take a look at what you have. From that information we can give you an estimate of the time and costs involved.

 Kona Impact | 329-6077

Think About it Friday: How a Japanese Kindergarten Design Can Help Your Business

I love TED talks. I love them so much so, that I decided to replace my morning news reading with a TED talk. They are much more uplifting than the news, and I find them a great way to get my mind thinking about what I do and what I can be doing.

One of the best talks I’ve seen recently is one about the design of a kindergarten in Japan. The basic premise of the talk is that design and architecture mold our environment and smart design can encourage movement, interaction and development. Here’s the video:

My take aways from video (as they relate to business) include:

1. Creating useful space can be achieved through removing barriers and clutter as much as it can be made through adding.

2. Communal space (like the four-sided wash basin) will create interaction and community.

3. Risk taking can be encouraged through design and planning.

4. Sometimes the solution to what we need is not at ground level.

5. Kids (and adults!), given the opportunity, will explore the space you give them.

6. Nature in a work environment can bring beauty and connection to the outdoor world.

What could your business do differently?

Kona Impact | 329-6077

A Model for Business Giving: Time, Talent or Treasure

First, this idea is not mine. I heard these three words first at a Rotary Club of Sunrise meeting several years ago. It has stuck with me throughout the years as a quick and easy way to remember what my company has to give: time, talent or treasure (money).

I get asked at least twice a week to donate to some cause. Yesterday it was a call about sponsoring a school’s folder; last week it was for printing flyers for an event, and two days ago it was mentor high school students. We said no to two out of three requests: sponsoring a school’s folder and mentoring high school students because we didn’t feel these would be a good use of our resources. Our experience with mentoring in the past, especially if it is school-directed, has not been good. We’d rather pay a young person to do actual work and learn along the way-a better win-win for all.

We have a few guidelines we use when deciding if we will give, and whether the donation will be our time, our talent or our money.

  1. Will the donation make a significant difference? There are many big organizations that received substantial federal, state and county funding. We tend to look at smaller groups that are self-funded or run on a very small budget. I like lean organizations, as I feel what I give them will make a big difference. A few hundred dollars to an agency that has a $2 million budget is unlikely to make a big difference.
  2. Is it a cause I believe in on a very deep level? Supporting education, children, the arts and the physically disadvantaged are what we focus on. These are part of what we know and understand, so groups that focus on other issues are generally less interesting to us. To this end we have given to Holualoa Elementary School’s literacy program, Deep and Beyond’s snorkel days and camps, Family Support Hawaii (Board of Directors), the Rotary Club of Kona’s Community Foundation (Board of Directors), Hawaii Island Growing Our Own Teachers (Board of Directors), and Aloha Theater/Aloha Performing Arts Company (new website and free hosting).
  3. Is our donation a multiplier? Providing PR materials for event multiplies our contribution many-fold. Providing expertise or consulting will help the entity grow or refine processes—a definite multiplier.
  4. Does Kona Impact get a PR benefit? Ok, the truth is that we want something in return. A nice thank-you letter is great and sufficient in most cases. Our logo on shirt, sign or email is good, too. If it’s for an event, thank your sponsors by name.

Last year we gave a $750 (retail) banner to a group. Their focus was something we believe needs attention. We will, however, decline future donations because we did not receive any recognition for what we had done: not a thank you letter, not recognition in the program, not even a call.

give us a donation

Note: please do not waste money on a West Hawaii Today mahalo ad! Send a simple letter or card to each donor instead! It’ll mean much more and it’s something they can put on the wall. Don’t waste money thanking us for giving money!

In the past Kona Impact used to write a lot of small checks; we now say no a lot and try to engage non-profits on a much deeper level.

 Kona Impact  | 329-6077

Ways Small Businesses in Kona Can Exist in a Land of Big Box Stores

The reality in Kona is that the big box stores—Walmart, Target, Kmart, Lowe’s, Home Depot and Costco—all have huge advantages over smaller, locally owned and operated businesses and stores. The have economies of scale, strong distribution networks and can fill our Sunday papers with advertisements each week. If you want to sell toothpaste, paper towels or 2’ x 4’s you are guaranteed to be beat on price and selection.

That said, there are some ways small, local businesses do well in Kona. We work with a lot of these businesses at Kona Impact and have come up with four keys to beating the big boxes, or, at least, developing a strong, sustainable business.

Develop connections with other small businesses. I am always amazed at how some small businesses in Kona will buy everything they can online or shop exclusively at chain stores and franchises, yet they expect others to buy locally. When you talk with other small businesses owners, participate in a paddling team, attend church or participate in a Rotary or Lions club, you are connecting with people who might become your customers. Even more important, these local businesses have a strong “coconut wireless” system for referrals and information. Get involved. Shop locally. Get connected.

buy local kona

Be the source for expertise in your area. I do not expect the employee in the Walmart garden section to have any knowledge of plants. They are just there to ring up your sale. The local nurseries, however, have very knowledgeable employees and can help you figure out what grows where you’re at and what doesn’t. I don’t expect the guy at the 20-minute oil change to look at my vehicles the way my local mechanic does. Sure, he costs more, but in the end, I feel like I’m getting much more value.

Have what the big stores don’t. I watch a tens of construction guys a week pick up specialty lighting from the business across from mine. The builders know that their customers, the home buyers, want quality and specialized lighting solutions—not the kind of stuff you’ll find at Lowe’s. Kona Coast Office Supply doesn’t bother with the cheap, flimsy file cabinets you’ll find at Walmart: they have the good stuff. Keeping a good inventory of hard-to-find items and helping clients with special orders is something the big stores often fail to do.

find a niche

Make it in Hawaii. Target is a huge store, about 100,000 sq ft or more, yet the “Hawaii” section is minuscule, maybe a few hundred sq ft. Walmart’s Hawaii section is mostly items not made in Hawaii! Come up with products that can only be made here, whether it is Dragon Fruit jams, Mamaki Teas or tours in Hawaii. Go where they won’t go. Selling at the local farmers markets and village strolls won’t make you rich, but they are an ideal way to connect with customers and introduce them to your website, which will allow you to sell to them anywhere at any time. You also might want to try selling to Costco; they have a pretty good reputation of local sources for agriculture products and some consumer good.

We all know it’s ridiculous to try and beat the big box stores at their own game. You don’t need to; there are many local businesses and people that are eager to buy locally and support their community. The key is to offer something the big stores can’t, whether it is specialized products or services or awesome customer service.

Kona Impact | 329-6077

Making Sense of the County’s Sign Code

We had two clients who own businesses in Kona express frustration with the sign code yesterday. One remarked, “Apparently the county doesn’t want me to be in business” after he was told he had to remove his small A-Frame sign from a place that was clearly not a safety issue. When a business owner says that we should listen, as he pays tons of taxes and runs a business that employs several people. It’s also a business that decided to rent space that has historically been vacant most of the time, so he has taken a bit of Kona blight and made it more vital.

First, a few things on which we can all agree: 1) nobody wants to see billboards on the side of highways or Las Vegas-like lighted signs, 2) nobody wants signs that have electrical or structural issues to not be properly installed and permitted, and  3) behind every sign there is a person trying to make a living.
las vegas signs

My problem with the County of Hawaii sign code is that it is not at all connected to the reality of what Hawaii Island is and what businesses need to do to survive. It’s also about 35 years old and doesn’t fit today’s reality.

Sure, on one hand you have a very small group of people who claim to protect the scenery of Hawaii by actively reporting sign code violations, no matter how big or small. No problem with that; we live in a democracy and they have a right to lobby, complain and have a vision of what they want Hawaii to be. They do not, however, represent all people, and they certainly do not represent the small business community, which in Kona provides way more jobs, services and economic vitality than all the big companies combined. At last count, we have over 2,000 small businesses from Hawi to South Point!

Here’s my problem with the sign code:

  1. It’s way too restrictive. Here’s one from the Prohibited Signs (Section 3-61) for any sign in Kailua Village: “Any sign for product advertising when visible to the general public. A sign containing only the name of a business is not a sign for product advertising.” So every sign you see that includes a product logo that is visible to the general public is technically in violation of the code. Also in that section of the code, temporary event signs can only be eight square feet. Anyone who has been on Alii Drive for the annual Ironman event knows that almost all the temporary signs on the buildings are nonconforming. Some of those temporary signs are 100+ sq ft! The code needs to be more flexible.
  2. It’s selectively enforced. Some districts have many nonconforming signs and some districts have less. That said, even in the areas where the sign code is enforced, almost all signs you see still do not meet code. Realtors put many Open House and other signs up that are nonconforming, but they seem to have a blanket pass from enforcement.
  3. It’s anti-business. Kailua-Kona is not a very well-planned community. Many of the buildings date back fifty years or more, and, truth be told, many are in varying states of disrepair. Retail shop space is often in hard to see locations and down dark and narrow passages between buildings or on the 2nd floor. The street front businesses have good visibility, but a lot of the affordable and open spaces are very hard to find. Signs are how these businesses direct people to their locations. One masseuse we know has a 2nd floor oceanfront location, but it is impossible to find without signs. When the county, through the property manager, made her remove her small street-level sign, her business dropped dramatically. She is now considering stopping her lease, which will not only affect her livelihood, but also add to the inventory of disused space.
  4. Signs are not what makes Hawaii Island beautiful (or not). Sure, if you hate signs and don’t care about the business and people’s lives they support, any sign is an eyesore. I find the numerous big box stores with huge buildings, lighted signs, large parking lots and Mainland goods as much more of an eyesore than the small businesses with a banner out front. The dilapidated buildings on Alii Drive are much more of an eyesore than the signs on them.The point is that the beauty of Hawaii Island is the skies, mountains and ocean. If the naysayers spent their efforts beatifying the medians of roads, the airport, our beaches and areas like the Old Airport, they would have a much bigger impact on making Hawaii a place that fits their image of what Hawaii should be
  • county-sign-code

Maybe it’s time to re-write the code in a ways that supports businesses and jobs, while at the same time protecting us from the things that can really affect our quality of life. If you own and business and are frustrated, contact your county council member and lobby for a reasonable sign code that helps instead of hinders business.

 Kona Impact  |  329-6077