Achieve Your Goals, Dreams, and Aspirations Through Your Company

Achieve Your Goals

Margaret Collier: An Artistic Entrepreneur

Entrepreneur

small business coach

Geri Wyatt, A Very Successful Restauranteur

Successful Serial Restauranteur

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Alan Melton: Founder of a Firm With Lots of Drive

How Tough Times Added Dollars to the Bottom Line

Business Coach

Challenging times have caused most business owners to “tighten their belts.” These difficulties have caused many owners to open their minds to the idea of working with a business coach. As a result of getting help, the owners that we are working with are experiencing more money in their pockets and growing sales.

Business Owners Overcoming Obstacles

In recent weeks it has been exciting to see business owners overcome obstacles and get clarity on their business calling. It has been fun to engage their employees in pursuing the business vision in a way that benefits everyone involved and the community as well! Most of all it has been rewarding to help them discover immediate results that put money in their pocket.

Business Owner Results

Consider some of the following results:

More Business Owners Using Business Coaches

Many business owners are now searching for a business coach who can assist them in expanding their operations. We have experienced a significant increase in coaching projects. The difficult economic challenges are motivating business owners to find every advantage to increase their market share and to add dollars to their bottom line. We are recently working with service companies, small manufacturers, and professional firms.

Results for a Service Company Owner

John*, a service company owner said, “I came to the realization that I love to fix problems, but I’m not a very good manager of this business. We have been just barely getting by for years, even when economic times were good. Now I realize that we have left a huge amount of money on the table.” In the first session with John and his team we added $75,000, which is pretty good considering John has been making $40,000 per year for the last ten years!

Conclusion

We find time after time that business owners are burned out. They have “foggy thinking.” They are working too much. They are too stressed out. They are on a treadmill, and they don’t know how to get off. Then many come to us to sell their company at the worst possible time. We are bringing on average approximately 2500% return on investment for our clients. For every $1.00 spent with us, we bring $25.00 in return.

Are you ready to take advantage of difficult times? If so, give us a call.

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Exit Strategy: Being in a Position of Strength

Exit Strategy

If you have done a good job of building a successful business, one day you should be able to sell it for a considerable sum of money. You have developed considerable “sweat equity” by working hard for your income.

It is wise to develop an “exit strategy” well in advance of your time to sell your business.  Actually, you should have an exit strategy on the first day you are in business. Private Equity Groups will not make an investment in a business until they know how they are going to exit the business.

Your Business is a “401k Plan”

Since the majority of your wealth is invested in your business, you should begin to think about your business as a “401K” plan. No matter how long you have been in business, an exit strategy is an essential part of ensuring that your long-term financial interests stay in place. This will be true even though a number of scenarios could require you to adjust the date and manner in which you exit your business.

Keep Yourself and Your Business in a Position of Strength

You want to prepare for the right reasons, the right timing and the appropriate manner in which you depart your business in the future. Keep yourself in a position of strength. Your goal is to depart your business on your terms, not the terms of someone else! Consider the following two issues:

1. You should know the value of your business.

You should know how much you want to sell your business for in the future. Your exit strategy should be anchored by what can realistically be accomplished through a business sale at a later date. We recommend that business owners get an annual evaluation of their business. In the same way that a 401k plan investor gets an annual statement with the account balance, you should know the value of your hard work, and you should focus on building that value. Knowing this value may transform how you run your business and how you approach risks. Too many business owners subject their long term financial interests to unnecessary risks because they do not clearly understand the likely future return on investment.

2. Make sure you have an exit strategy that anticipates the unexpected.

There is a strong likelihood that the timetable you have in mind for a future business sale may not come to pass right on schedule. It will likely happen sooner or later than your plan. The time spent preparing for “worst-case scenarios” will position you to save time, money, and legal problems. This time investment will help you to avoid stress, heartburn, the loss of your “401k” retirement plan. Below are some scenarios that could cause a major course correction.

Your Business Exit Strategy Should Consider Potential Scenarios

Do you have an exit strategy that addresses these potential scenarios?

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•    You become burned out, go through a divorce, or a health crisis.

•    You want something more challenging, more fun or less stressful.
•    You run short on working capital.
•    Your business needs new skills, a new approach or resources you can’t provide.
•    Your partner wants out of the business, dies or becomes disabled.
•    Your partner gets divorced and needs cash for a settlement.

The fact is that very few business people want to spend time considering these negative situations, but the reality is that these things can happen, and you want to protect your retirement plan. Wise business owners make the time to address these issues.

Conclusion

A wise saying is that “you shall know the Truth, and the Truth shall set you free.”  Spending the time now working on your business exit will help you plan for the unforeseen, and will allow you to build and protect your largest investment and asset; your “Business 401k plan.”

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How Tough Times Added Dollars to the Bottom Line- Part 2

business owners
Part 2 of 2

In February I wrote about some successes we have recently seen with business owners who have added significant dollars to cash flow. In this article, I continue their stories of results they are experiencing. These difficult economic times are causing many business owners to rethink their strategies, lower expenses, and to get more creative in doing things better.

Struggling Business Owners Working With a Business Coach

These challenges have also caused many business owners to open their minds to the idea of working with a business coach. As a result of getting help, the business owners that we are working with are experiencing more cash flow and they are growing their businesses.

Here’s an update on some business client results and some new examples:

  1. One business owner ($275,000 in annual revenues) made several small revenue modifications and several expense item changes that increased the profit of the business by more than $51,000.
  2. A service biz owner ($1.2 million in annual revenues) made two changes to sales and pricing that added $75,000 in profits. In March we worked with the owner and his employees to identify five areas of cost savings, for a total of $101,000. The total amount added to his bottom line: $176,000 per year!
  3. A service company owner ($440,000 in annual revenues) added $30,000 to her cash flow with one sales strategy. In April we helped her to add an additional $22,000 to her cash flow with one very simple idea. In five minutes she had increased her monthly cash flow by nearly $2,000! Total money in her pocket: $52,000 per year.
  4. A retail business owner hired us to do a business evaluation. He was able to use the evaluation to help him sell his business to one of his employees.

Update on John,* a service company owner

John has been making on average about $40,000 per year for the last ten years. He is an excellent technician and innovative business person, very advanced in his area of expertise. He has excellent values and treats his employees well. Unfortunately, he has been working approximately 80 hours per week during that time. Do the math: he is probably making less than minimum wage. He said that the thing that he wanted most was a date with his wife.

We started out by helping John get a clear personal vision, then worked with his management team, and then his employees. In the first three sessions with John and his team, we added $176,000 to his cash flows, and I have recommended an additional improvement of $72,000 per year. We also showed John how to focus on what he loves the most while finding others in his business to do work that keeps him in the office late. He said, “I came to the realization that I love to fix problems, but I’m not a very good manager of this business. We have been just barely getting by for years, even when economic times were good. Now I realize that we have left a huge amount of money on the table.”

Blind spots in Your Business

The fact is that we all have blind spots. Many people could come into our coaching practice and find areas of improvements. As business coaches, we had the benefit of running our own businesses and hiring a coach. That led to being successful in our own businesses. Additionally, we have the advantage of working with many other business owners in learning what works and what doesn’t work well.

A common malady of being in our own business is becoming burned out. We can get “foggy thinking.” We tend to work too much. We get bogged down in the day to day issues. We don’t know how to improve our cash flow. We get too stressed out. We end up on a treadmill and don’t know how to get off.

Business Coaching works for Business Owners

Coaching works, or I should say that it works for many business owners. There are some business owners who are not good candidates for coaching.

Are you ready to take advantage of difficult times by growing your business and overcoming cash flow problems? Would you like some sound business ideas?

Questions about our small business coaching services?

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What is the One Missing Key to Your Business Success?

business success

Just like humans, every business has weaknesses.  In some cases, business owners simply need to work on one or two areas to propel their business to amazing growth and profits. Entrepreneurs can benefit from the services of small business coaches, who can assist them in identifying areas that require improvement while also guiding them toward business success.

One of my business ventures was a small service company with 130 employees. Our largest customer was a Ritz Carlton hotel, and the hotel chain was involved with the Malcolm Baldrige Process, a way for organizations to achieve outstanding results. Our leadership team decided to get involved with this process at a state level, and we hired a small business marketing coach to help us identify areas of improvement. We grew our profits by more than one thousand percent!

Seven Keys to Success in Business

There are seven keys to business success according to the Baldrige criteria. Over the next few blog articles, I will be writing about these seven keys. How is your business doing in these areas?  Growth normally requires things like small business loans and access to business credit lines but without these 7 keys, you will not be managing that growth as effectively and efficiently as you could.

1.  Leadership in Business.

Most small businesses are strong in the area of leadership. It takes strong leaders to start and run business. However, once your business is going, how do you keep the momentum going? Do you communicate a clear vision, strong values, and a compelling mission? Is your team growing, learning and adjusting to the business environment?

2.  Strategic Planning in Your Business.

In my work with small business owners, many do not have a current business plan.  That is a huge mistake, especially in this volatile business environment. For example, you would be surprised how many businesses are fortunate enough to get a small business loan but then they don’t use the funds for revenue-generating initiatives and the end result is just more debt and no new clients or business.  Every business owner should have short and long term goals, and every employee should understand the goals. Consider all your stakeholders during your planning.

3.  Customer Focus in Your Business.

This area is also a strength for many small business owners. But as a business grows it is easy to lose touch with customers, and without customers your business is dead! Do you have ways of measuring customer satisfaction or dissatisfaction? Are you improving?

4.  Measurement in Your Business.

Speaking of measurement, do you know your business “stats?” In the same way that sports teams know statistics about players, coaches and their offense and defense, you need to track important information. Nearly everyone tracks sale and profits, but do you know the value of your business? What are your key business success factors? Do know how your numbers compared to competitors? You should.

5.  Workforce Focus in Your Business.

Many business owners struggle with finding good employees. Your employees are critical to your business success. Cutting edge leaders believe that their employees are more important than their customers.  How do you attract and retain good people?

6.  Operations Focus in Your Business. 

The way you deliver your product or service can make you or break you. If you can provide excellent products and services consistently every time, your customers will likely stay with you. Otherwise, you are “rolling the dice.”  Wise business owners develop measurable processes that ensure a great customer experience with few exceptions.

7.  Results in Your Business.

This, of course, is the bottom line of all your efforts in business. Once you have determined what is important to measure and have established measures, how are you doing? Are your “stats” improving? How do they compare with your competition or industry? Are your sales and profits growing, or are you struggling like many small businesses? Is your business value growing?

Conclusion

After reviewing these seven keys, what are the top one or two areas that could use some attention in your business? Focus your efforts on the area where your business needs to improve. If you need help, don’t be afraid to seek it out.

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The Impact of Smartphones on Marketing Tools

Marketing tools

In recent years small business sales relied on signage and visibility to attract new business. To be sure, your business signage and the outside marketing tools employed are still pretty important. But, the world has changed and you must too!

In 1980, a then-unknown Ed Rensi, who later became McDonald’s most famous President, USA developed a controversial and amazingly effective signage program for the Philadelphia Market. The plan involved painting large signs on buildings throughout the city, buying buses, benches and yes even bread trucks and positioning the famous Arches with directional information all over the place. The results were astounding.

It would not be as effective today, and even less tomorrow.

The Impact of Smartphones on Marketing

With Smartphone usage approaching 50% by US consumers, the business “windshield” is a completely different one now. Your customer is looking through his phone web browser searching for a particular business type, selecting based on preference and convenience, and mapping to your front door. If you have moved ahead of the curve and prepared an App for your customers they simply tap your logo and find you now. Make sure you have marketing tools for the future!

Conclusion

So today’s small business question is very simple…have you prepared your business to be seen through the new customer windshield?

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The Top Ten Ways to Improve Your Cash Flow

Improve your cash flow

If you have been in business for any length of time, not only have you heard the statement “Cash is King,” you have experienced it too. In this difficult economy the person with cash rules and the person who is out of cash will do almost anything to “serve the king.” The person with cash can buy things at a deep discount from the person who does not have cash. Understanding cash flow management is essential for a successful business. If you improve your cash flow, you likely enhance your business.

Bootstrapping in Business

In some ways “bootstrapping,” the slang word for starting and running a business with little capital can be a positive thing. It forces you to live within your means or fail. Being in a survival mode can be helpful if you maintain that mentality as your profits grow. On the other hand, being under-capitalized is the primary reason that most businesses fail. It is a major source of stress for business owners. You need to know where you are financially and have a plan for covering your obligations. Most importantly, you need to have some cash left for you!

Covering Your Monthly Business Obligations

As a business owner, you can be flooded with customers and still drown in a sea of expenses. Your business has fixed expenses that have to be covered every week and month, such as payroll, loans, rent, utilities, phone, and advertising. In addition, you probably have variable expenses which are tied to your sales activity. When your sales rise and fall, variable expenses rise and fall along with your sales. Some examples could include hourly payroll added for increased activity, or credit card fees, or cost of goods sold.

However your sales may be sporadic, or there can be a delay of when you get your money. If you own a seasonal business, going into a peak season can literally put you out of business. Usually there is a lag in cash coming in on sales, but of course, there is no lag on your fixed expenses. One of my former businesses had a revenue increase of 400% from our off-peak to our peak season. You can bet that we learned a few things about managing cash flow!

Getting Started With Improving Cash Flow

You basically need to predict two things: what your money coming in from sales this month is going to be, and what your total expenses for this month are going to be (fixed and variable). If you expect to have more money coming in than money going out, and if you deliver on that prediction, you have positive cash flow. You want to be cash-flow positive all the time, but that can be difficult when you are starting out and growing your business. You don’t want to spend too much, especially if your sales are not growing as predicted.

Here is my top ten list of ways to improve your cash flow:

1.    Implement cash flow budgeting and management.

As I mentioned earlier, you should do this monthly. If your sales are falling short of your predictions, cut back on your expenses.

2.    Promote credit card and cash payment at the time of the order.

Collect by cash or credit card upfront rather than waiting until after the product or service is rendered. If the customer asks for terms, get their credit card number as security for payment.

3.    Improve payment terms on extended projects or services.

If you cannot get paid the entire amount in advance, then collect a substantial deposit at the time of order, then additional payments during the term of the contract. Don’t deliver the final product until you have been paid in full.

4.    Make a portion of your payroll variable.

Rather than guaranteeing a salary to all of your employees, only pay them when you need them. Link payroll to sales activity. You can hire independent contractors. You can employ seasonal workers with the understanding that their work hours are reduced or eliminated when business is slow.

5.    Discounts for timely payments.

You can offer a small discount if invoices are paid within 30 days. Many businesses offer 1%- 2% discount.

6.    Negotiate extended payment cycles with vendors during peak seasons.

Go to vendors in advance when you don’t have any past due obligations, and simply explain your cash flow cycles. If your vendor is not flexible, shop around.

7.    Do a credit check on new customers.

As an alternative, you can also buy credit insurance that covers non-paying customers.

8.    Track inventory and supplies.

Identify waste and make improvements to save money.

9.    Shorten product or service cycle times.

Shorten the delivery time of the product or service and you will get paid faster.

10.    Have a back-up plan and emergency strategies.

Strategies can include having a cash reserve, having a line of credit from your bank in place(you can use accounts receivables or inventory as collateral for a line of credit), or even keeping some low-interest credit cards with zero balance. Be sure to keep the balance zero in non-emergencies!

Coaching Client Adds $176,000 in Cash Flow

We were recently working with a client that had a severe cash-flow shortage. We identified seven areas of improvement that added $176,000 to his bottom line and dramatically improve his cash flow in 30 days. Although his cash flow had been poor for ten years, we were able to solve his problem in three meetings with the owner and his staff!

Conclusion

A wise saying is “you get what you focus on.” If you will invest some time each month in cash flow management, you will make sure that you have enough cash to keep your business going in the right direction. Then you can be crowned as “The Cash King!” You will be able to grow your business. You will have less stress. You will also be able to seize some opportunities that come your way.

Questions about our small business coaching services?

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