First Principles: This is a Master Class for small business owners. But it is really a class for anyone because it is about meaning and value of life, i.e. learning how to create something of value.

Topic for discussion: Remember school tests and grades? When we graduated from high school and college, we stop being actively graded by teachers. Now, life grades us. Our friends grade us. Our family grades us. And for sure, our work grades us.

So, what is this Master Class and how is it graded?

Possible answer: Whether or not you know amount, your business has a value and a valuation range. And just like stocks, bonds and eggs, Triple A is more valuable than an A. Here "grades" are business valuations and judgments about the staying power of the business.

In a Master Class the judgments are reserved for later. The working professional, usually somebody who is at the top of their game, takes over and demonstrates how things are done really, really well.

It is a time to hear, see, and feel the moments of perfection.

This show is all about finding those moments within the lifes of ordinary people doing extraordinary things. Leonor Ferrer and her people are, more than ever, expected by us all to have her eyes open and her intuitions alert all at the same time she teaches us how to be global citizens and do the right things when we try to export to, or import from, another country.

For more, read Small Business School.

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Key Idea #1: Hire attitude and aptitude not skill.

Key Idea #1: The Lightbulb

Stanley Marcus said he looked to hire smart people with a degree in liberal arts then he could teach them how to be merchants. Leonor does the same thing. She looks for people who are willing to learn, then teaches them how to deliver the special service Leonor believes is unique to her company. She has found her small company, only 14 employees, works like a well-oiled machine because after 15 years in operation she has many veteran employees who all learned the business from Leonor.

To train a new person takes a big commitment, but, it is paying off for Leonor. She finds it is much better to spend time teaching the right person the brokerage business rather than hire the wrong person who knows the business.

What do you think?

Even though it might not make sense at first, why do you think this philosophy is so effective?

Possible answers: Once the knowledge is attained, the single most important quality of a service provider is a their ability to make people feel good which happens when the service provider listens, is empathic and then can solve problems for the customers. A knowledgable person who isn't interested in serving the customer can do more harm for Leonor than good.

For example, if a customer brings a new problem to Ferrer Brokers and they don't have the creativity, energy or interest to solve the problem, Ferrer can loose the account.

You think back...

What is one technique Leonor uses to make sure she has the right person hired?

Answer: Every new employee comes in on a six-month probationary period. This gives Leonor time to evaluate the attitude of the person. In an interview, or even in a series of interviews, it is difficult to access attitude. You can administer tests which measure aptitude such as math and verbal skills, but, there is no test for measuring someone's willingness to learn, their real-life problem solving skills and their ability to fit into the group.

Note: Many companies who have a job opening fill it with a "temp" and if that person fits the job and the company they are hired permanently. This is another way the "audition" a person before you commit to full-time employment. The reason this is so important is employee costs are in many service organizations the single largest expense item. People are expensive to hire, teach and sustain so you want to find and keep the right people for your company.

What do you think?

When Leonor says she wants someone fresh out of school who doesn't have to unlearn bad habits, what bad habits do you think she is talking about?

Possible answer: Two categories of bad habits: first, the way paperwork is handled and the details of the work executed; and second; the attitude of employees toward each other and the customer. For example, in Leonor's mind, no customer is too small and no job too small for her company to handle. If an employee who had worked in a big company was used to putting the "little guy" at the end of the line or not treating that person with respect, Leonor would have to intervene. The customer at the beginning of the tape is an example of a very small business and Leonor's staff was handling him with grace and enthusiasm.

Key Idea #2: Different strokes for different folk.

Leonor recognizes the individuality of people and works to put the right person in the right place.

You think back...

What employee did she refer to when she said, "we just leave her alone."

Answer: She was talking about Sylvia who wants to be left alone with her computer. This is great because Leonor has to have someone in the organization who loves technology and who would rather be alone with her computer than work directly with a customer or go to customs in person to discuss a problem.

The reason Sylvia's focus on the computer is so important is that the U.S. Customs Office requires every broker to provide complete transaction data electronically. This means, legally, Leonor needs someone to make all the electronic reports to the government accurately and in a timely fashion.

The ability to see the value in each individual's unique contribution is an important leadership skill.

Key Idea #3: Leonor identified the need she could fill.

Leonor started her business after working for a large custom brokerage house and knew they were not taking care of the small businesses who needed service.

What do you think?

Can her idea apply in any industry?

Possible answer: Yes. You name the category and a small business exists or could exist to service a unique niche. Here are just a few examples: There's a hotel chain for every pocketbook. Fast food started in the burger business now there's Chinese, Mexican, Greek, etc. There are automobiles with big engines and small bodies and ones with small engines and big bodies, then there's everything in between

There's a business potential if there's a need that is not being filled. As small businesses become more internationally savvy, they will export and import more. Leonor has built a nice business doing custom brokerage work for the many small businesses who could not get the attention and service they needed from the big companies.

Key Idea #4: There are many resources to help the small business owner develop an international market.

You think back...

Who is Abby Shapiro and what does she do?

Answer: You can get help from the government by calling USA Trade, 1-202-482-4473 or go to the web site: www.ita.doc.gov/tic

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Key Idea #5: Keith Games says, "Distance is no longer a deterrent to exporting. Time, not distance, determines the level of service you can provide."

What do you think?

Why is this so important to grasp?

Possible answer: We may be lulled into thinking our business has no competition then wake up one morning to find our customers buying what they need from a competitor we didn't even think existed. This competitor could be across the street or around the world but finding a way to get to our customer in non-conventional ways. The most obvious example is amazon.com. You never need go to a bookstore in your neighborhood again, you don't have to leave your computer to buy the exact book you want This doesn't mean you won't enjoy going to a bookstore in the future but, you as a consumer have a choice today you never had before. This choice is causing turmoil for all businesses.

The company who can deliver fast, hassle-free service will win the customer of the future.

Key Idea #6: You can build a business without spending a dime on advertising.

You think back...

How has Leonor acquired customers?

Answer: She inherited her first 12 customers from a broker who retired and has grown by word of mouth. She said she doesn't like personal sales so she has worked hard to please her customers who then tell others about her service. If you keep pleasing people you'll stay in business.

You think back...

Other than delivering such good service that her customers bring her new customers, what has Leonor done to attract new business?

Answer: She built her own building right across the street from the border crossing. She has good relationships with the customs officials who often send her people who need help and she is the first business the truck drivers see as they come into the U.S. at Otay Mesa, California.

Key Idea #7: You don't own a business for 15 years without experiencing some disappointment.

You think back...

Name some of the barriers Leonor has managed to overcome.

Answer: First, she had no money to start her business so she borrowed from family and friends then lived conservatively herself and still does today. She takes a very small monthly salary then pays herself a bonus if there money is left at the end of the year. She was scarred of running out of money so she saved in order to finance her own line of credit.

This way no employee has ever had to go without a paycheck .

Second, she had a partner at the beginning but learned that if you have the leadership skills required to run a business, you are better off without a partner.

Third, she was the first Latin woman running a customs office at the California-Mexico border.

Key Idea #8: Leonor says to start a business you have to have a good idea, be willing to do without, and have a hunger inside to be independent.

What do you think?

Has Leonor been successful in the eyes of the business community?

Possible answers: Yes and no. She has her own building, 14 employees, many happy customers and in that way she is a success. But, many would say she should be more aggressive in her sales and marketing to grow the business since she is physically and in terms of experience, positioned to be large. She lives in a modest home and is not a multi-millionaire. You decide. I say, if she has what she wants and is achieving her own goals then she is a complete success.