Being in business for yourself can be tough. We are our own worst enemy. We tend to be more critical of ourselves than anyone else and we are quick to chide ourselves for errors or missed deadlines. But what about all the times that you get it right? What about completing a major project like opening a new store – I bet you celebrate that with a grand opening. What about projects that are just as important or even more important than a story opening? Projects that aren’t that glamorous. What do you do when you’ve completed your business plan or developed a budget or a sales and marketing calendar? Do you celebrate then? Do you treat yourself to something special?
If we are our own worst enemy, than we sure as heck better be our own best friend. The last step of every project that I work on with my clients is “Celebrate”. That is probably the most important thing to get right. So next time you finish a task or project regardless of how glamorous (or not) it is, be sure to treat yourself. You’ve earned it.
Monday, March 8, 2010
Tuesday, March 2, 2010
If you had 2 years to build a successful business...
If you inherited a business that you knew very little about and had 2 years to make it successful, where would you start? There are so many different things that need to be addressed. What should be tackled first, second, etc. Here's my list. I encourage you to weigh in on the subject.
1. Cash Flow – no business can operate without cash, so my first priority is to understand and project cash flow for the business.
2. Compliance – is the business in compliance with all federal, state, and local laws governing that business, including licenses, permits, insurance, taxes, etc? If a business has cash, the next biggest risk is the government shutting them down due to non payment of taxes, no licenses, etc.
3. Sales/Profitability – Are they selling the right products @ the right price? Do they understand the cost structure of their products/services and are they priced correctly for the market? We all know the danger of selling things at too low of a margin or even below cost. It links back to the focus on cash and revenue stream.
4. Expenses – does the owner understand their cost structure and how to control expenses? What benchmarking information is available for comparison? Out of control expenses are the quickest way to burn through cash.
5. People – Are the best people doing the right jobs? Are they compensated fairly? Are they a cohesive team? Do they hold dear the same values and business ethics as the owner? Do they compliment the owners strengthens and weaknesses? Numbers are numbers, but you can’t run a successful business without people. Having the right people can mean the difference between getting by and excelling in business.
6. Sales/Marketing – Is the owner actively marketing the business? Do they have a sales and marketing plan? If not, then create one and implement it ASAP. The best way to increase cash is to increase sales.
7. Assets – Does the owner have the right amounts of inventory and equipment? Is there too much cash tied up in non working assets or old inventory? Do they have controls in place to evaluate and assess what the correct levels are? Do they have idle equipment or are there bottlenecks that will prevent them from growing?
Wow, I was going to stop a 5 items, but I kept thinking of more and more things that are important to making a business a success. I could have kept going, but I didn’t have time nor do you probably want to read a book at this point. So what do you think, what would be your priorities and why…
1. Cash Flow – no business can operate without cash, so my first priority is to understand and project cash flow for the business.
2. Compliance – is the business in compliance with all federal, state, and local laws governing that business, including licenses, permits, insurance, taxes, etc? If a business has cash, the next biggest risk is the government shutting them down due to non payment of taxes, no licenses, etc.
3. Sales/Profitability – Are they selling the right products @ the right price? Do they understand the cost structure of their products/services and are they priced correctly for the market? We all know the danger of selling things at too low of a margin or even below cost. It links back to the focus on cash and revenue stream.
4. Expenses – does the owner understand their cost structure and how to control expenses? What benchmarking information is available for comparison? Out of control expenses are the quickest way to burn through cash.
5. People – Are the best people doing the right jobs? Are they compensated fairly? Are they a cohesive team? Do they hold dear the same values and business ethics as the owner? Do they compliment the owners strengthens and weaknesses? Numbers are numbers, but you can’t run a successful business without people. Having the right people can mean the difference between getting by and excelling in business.
6. Sales/Marketing – Is the owner actively marketing the business? Do they have a sales and marketing plan? If not, then create one and implement it ASAP. The best way to increase cash is to increase sales.
7. Assets – Does the owner have the right amounts of inventory and equipment? Is there too much cash tied up in non working assets or old inventory? Do they have controls in place to evaluate and assess what the correct levels are? Do they have idle equipment or are there bottlenecks that will prevent them from growing?
Wow, I was going to stop a 5 items, but I kept thinking of more and more things that are important to making a business a success. I could have kept going, but I didn’t have time nor do you probably want to read a book at this point. So what do you think, what would be your priorities and why…
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