We came across this great post from Forbes.com regarding small business resolutions and wanted to share. It's not too late to set resolutions for your small business just because we're late into the month. If you have, let's be honest-- like a lot of us, you may already need a friendly nudge to get back on track!
Check out these great points by Jason Zickerman, president and CEO of The Alternative Board. Forbes.
Fostering the entrepreneurial spirit!
Showing posts with label business plan. Show all posts
Showing posts with label business plan. Show all posts
Wednesday, January 22, 2014
Monday, December 16, 2013
12 Successful Entrepreneurs Share the Best Advice They Ever Got
From Entrepreneur.com-- some great advice to some of the current greats of business!
Being a successful entrepreneur frequently involves a series of missteps and mistakes before finally nailing the right idea or business. The difference, for many, between giving up and persisting through the toughest times can be getting advice from people who have done it before — and being smart enough to listen.
From investor Mark Cuban's dad telling him that there are no shortcuts to Lululemon founder Chip Wilson's realization that people actually enjoy helping others, we asked 12 successful entrepreneurs to share the best advice they ever got, discovering the lessons that stick with them to this day.
Being a successful entrepreneur frequently involves a series of missteps and mistakes before finally nailing the right idea or business. The difference, for many, between giving up and persisting through the toughest times can be getting advice from people who have done it before — and being smart enough to listen.
From investor Mark Cuban's dad telling him that there are no shortcuts to Lululemon founder Chip Wilson's realization that people actually enjoy helping others, we asked 12 successful entrepreneurs to share the best advice they ever got, discovering the lessons that stick with them to this day.
Monday, November 18, 2013
Creating a Council of Advisors
"Experience is one thing you can't get for nothing." Oscar Wilde
Family-owned and other closely-held corporations often experience the need for independent, unbiased advice to guide the business through the ever changing business climate, as well as through personality and family differences that can harm and even destroy a business.
Traditionally, corporations have looked primarily to Boards of Directors to provide the expertise and counsel necessary to manage the business. Often Boards of private companies are supplemented with members who are neither shareholders nor officers of the corporation. However, in the context of family-owned and closely-held corporations, a Board of Directors has significant shortcomings even with the use of outside independent Directors. The stockholders may not feel comfortable granting legal management control of the business to an enlarged Board comprised in part of non-family members. Potential Directors are also reluctant to accept Board membership because of the potential liability to the shareholders, the corporation and third parties arising out of a Director's legal status as a fiduciary.
A developing alternative to the traditional board of directors is the use of a Council of Advisors which can provide an independent forum to address and discuss business policy and practices without many of the concerns attendant to the Board of Directors.
Family-owned and other closely-held corporations often experience the need for independent, unbiased advice to guide the business through the ever changing business climate, as well as through personality and family differences that can harm and even destroy a business.
Traditionally, corporations have looked primarily to Boards of Directors to provide the expertise and counsel necessary to manage the business. Often Boards of private companies are supplemented with members who are neither shareholders nor officers of the corporation. However, in the context of family-owned and closely-held corporations, a Board of Directors has significant shortcomings even with the use of outside independent Directors. The stockholders may not feel comfortable granting legal management control of the business to an enlarged Board comprised in part of non-family members. Potential Directors are also reluctant to accept Board membership because of the potential liability to the shareholders, the corporation and third parties arising out of a Director's legal status as a fiduciary.
A developing alternative to the traditional board of directors is the use of a Council of Advisors which can provide an independent forum to address and discuss business policy and practices without many of the concerns attendant to the Board of Directors.
Wednesday, September 4, 2013
The Ten Commandments of Small Business Ownership
I. Establish the Strategic Direction of the Company ... Mission Statement!
II. Build Loyal Employees
III. Hold Employees Accountable
IV. Continue Upgrading Management
V. Build Strong Relationships ... vendors, customers, and advisors.
VI. Keep Margins and Markups as Low as Possible
VI. Always Produce and Provide Quality
VII. Strive to be the "Low Cost" Producer
VIII. Grow ... but do so prudently and profitably.
IX. Create Excellence in Operations and Execution
X. Control the NUMBERS!
XI. THOU SHALT MAKE A PROFIT!!!
II. Build Loyal Employees
III. Hold Employees Accountable
IV. Continue Upgrading Management
V. Build Strong Relationships ... vendors, customers, and advisors.
VI. Keep Margins and Markups as Low as Possible
VI. Always Produce and Provide Quality
VII. Strive to be the "Low Cost" Producer
VIII. Grow ... but do so prudently and profitably.
IX. Create Excellence in Operations and Execution
X. Control the NUMBERS!
XI. THOU SHALT MAKE A PROFIT!!!
Saturday, June 8, 2013
Business Planning Done Right
Yogi Berra may have said it best:
“If you don’t know where you are going, you might wind up someplace else”A commonly cited reason businesses fail is that they do not have a current business plan, let alone one that is well thought-out. If it is so important to have a current business plan, why doesn’t every business have one?
Some of the excuses given:
• We prepared one when we started the business.
• Nothing much has changed since we prepared it last.
• The plan is in my head.
• Our management team meets frequently, so we don’t need one.
• We are too busy with day-to-day issues to put one together.
• We don’t have a good example to follow.
The planning process itself is extremely valuable, because it allows you (or your management team) to determine where you want to be in the future and how to get there. However, most of that value is quickly lost if the results and decisions are not committed to paper. A major benefit of preparing a business plan is to have a document that can be used by the business for alignment of managers and staff.
There are many templates available to help you structure your business plan. Using a business plan template can be helpful to ensure you address the range of important topics that must be considered in running a successful business. The topics covered and the type of information developed for your plan should always be tailored to the specific circumstances of your business.
When picking a template or an example business plan to follow, make sure it is simple enough to complete readily, yet detailed enough to address all the important issues facing your business. A long and cumbersome plan is of little use if nobody will read it or use it. Remember the purpose of the plan is to guide the business, not to document every aspect of all operations.
All good business plans have some common characteristics, including:
• Always written
• Simple enough to be prepared in the first place
• Detailed enough to be useful
• Realistic and real-world
• Tailored to the specific business
• Includes input/review from key team members
• Understandable by all affected managers
• Includes implementation, not just strategy
• Contains specific and measurable objectives
• Includes actions and target dates
• Referred to routinely
• Updated regularly to be kept current
Please remember:
• It is not a business plan unless it is written
• Update your plan at least every six months
“If you don’t know where you are going, you might wind up someplace else”A commonly cited reason businesses fail is that they do not have a current business plan, let alone one that is well thought-out. If it is so important to have a current business plan, why doesn’t every business have one?
Some of the excuses given:
• We prepared one when we started the business.
• Nothing much has changed since we prepared it last.
• The plan is in my head.
• Our management team meets frequently, so we don’t need one.
• We are too busy with day-to-day issues to put one together.
• We don’t have a good example to follow.
The planning process itself is extremely valuable, because it allows you (or your management team) to determine where you want to be in the future and how to get there. However, most of that value is quickly lost if the results and decisions are not committed to paper. A major benefit of preparing a business plan is to have a document that can be used by the business for alignment of managers and staff.
There are many templates available to help you structure your business plan. Using a business plan template can be helpful to ensure you address the range of important topics that must be considered in running a successful business. The topics covered and the type of information developed for your plan should always be tailored to the specific circumstances of your business.
When picking a template or an example business plan to follow, make sure it is simple enough to complete readily, yet detailed enough to address all the important issues facing your business. A long and cumbersome plan is of little use if nobody will read it or use it. Remember the purpose of the plan is to guide the business, not to document every aspect of all operations.
All good business plans have some common characteristics, including:
• Always written
• Simple enough to be prepared in the first place
• Detailed enough to be useful
• Realistic and real-world
• Tailored to the specific business
• Includes input/review from key team members
• Understandable by all affected managers
• Includes implementation, not just strategy
• Contains specific and measurable objectives
• Includes actions and target dates
• Referred to routinely
• Updated regularly to be kept current
Please remember:
• It is not a business plan unless it is written
• Update your plan at least every six months
Wednesday, June 5, 2013
7 Ways to Build Wealth Personally or In Your Business
Money is a valuable tool for all of us
to have and use in our lives. It is there to be accumulated and used… but we
must learn how to do both or we will never have wealth and what money we do
have we will most likely not keep.
In 1926 George S Clason published The Richest Man in Babylon. In this
systematic and entertaining book Clason presents and details the ways to
accumulate and keep wealth that are when applied as certain as the law of
gravity.
“Money is plentiful for those who understand the
simple laws which govern its acquisition.” – George S Clason
In the book Clason introduces Arkad,
the richest man in Babylon. Early in the
book Arkad is asked by the King to teach 100 men the secret to wealth. Here is
a summary of what he taught them.
- Begin paying yourself
first.
- Budget and control what
you spend. Discipline yourself to live on far less then you earn.
- Make your money work for
you. Invest in safe enterprises or the highest rates of compound interest
available.
- Keep your savings safe. Do
not speculate.
- Buy a home for yourself
and your family.
- Insure you future income
for your retirement and the estate you will leave your loved ones.
- Increase your ability to
earn. Be the best at what you do and learn to do more.
Eric
Eric W. Leaman
Trustee
Organization for Entrepreneurial Development
Unleashing the entrepreneurial spirit.
Change your mind ... and EVERYTHING changes
Sunday, April 22, 2012
What is Marketing Research?
"The secret to success is - find out where the people are going and get there first." - Mark Twain
Basically, marketing research is just what the merchant did with the peanuts. Find out what catches customers' attention by observing their actions and drawing conclusions from what you see. To put it more formally, in the words of the American Marketing Association, marketing research is "the systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services."
Marketing research is an organized way of finding objective answers to questions every business must answer to succeed. Every business owner-manager must ask:
Who are my customers and potential customers?
What kind of people are they?
Can and will they buy?
Am I offering the kinds of goods or services they want - at the best place, at the best time, and in the right amounts?
Are my prices consistent with what buyers view as the products' values?
Are my promotional programs working?
What do customers think of my business?
How does my business compare with my competitors?
Marketing research is not a perfect science; it deals with people and their constantly changing likes and dislikes which can be affected by hundreds of influences, many of which simply can't be identified. Marketing research does, however, try to learn about markets scientifically. That simply, is to gather facts in an orderly, objective way; to find out how things are, not how you think they are or would like them to be; what people want to buy, not just what you want to sell them.
Why Do It?
It's tough - impossible - to sell people what they don't want. (Remember the Nehru jacket?) That's pretty obvious. Just as obvious is the fact that nothing could be simpler than selling people what they do want. Big business has to do market research to find that out. The same reason holds for small business.
Business owners often have a "feel" for their customers - their markets - that comes from years of experience. Experience can be a two-edged sword, though, since it comprises a tremendous mass of facts acquired at random over a number of years.
Information about markets gained from long experience may no longer be timely enough to base selling decisions on. In addition, some "facts" may be vague, misleading impressions or folk tales of the "everybody knows that..." variety.
Marketing research focuses and organized marketing information. It ensures that such information is timely. It provides what you need to:
Reduce business risks,
Spot problems and potential problems in your current market,
Identify and profit from sales opportunities,
Get basic facts about your market to help you make better decisions and set up plans of action.
Basically, marketing research is just what the merchant did with the peanuts. Find out what catches customers' attention by observing their actions and drawing conclusions from what you see. To put it more formally, in the words of the American Marketing Association, marketing research is "the systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services."
Marketing research is an organized way of finding objective answers to questions every business must answer to succeed. Every business owner-manager must ask:
Who are my customers and potential customers?
What kind of people are they?
Can and will they buy?
Am I offering the kinds of goods or services they want - at the best place, at the best time, and in the right amounts?
Are my prices consistent with what buyers view as the products' values?
Are my promotional programs working?
What do customers think of my business?
How does my business compare with my competitors?
Marketing research is not a perfect science; it deals with people and their constantly changing likes and dislikes which can be affected by hundreds of influences, many of which simply can't be identified. Marketing research does, however, try to learn about markets scientifically. That simply, is to gather facts in an orderly, objective way; to find out how things are, not how you think they are or would like them to be; what people want to buy, not just what you want to sell them.
Why Do It?
It's tough - impossible - to sell people what they don't want. (Remember the Nehru jacket?) That's pretty obvious. Just as obvious is the fact that nothing could be simpler than selling people what they do want. Big business has to do market research to find that out. The same reason holds for small business.
Business owners often have a "feel" for their customers - their markets - that comes from years of experience. Experience can be a two-edged sword, though, since it comprises a tremendous mass of facts acquired at random over a number of years.
Information about markets gained from long experience may no longer be timely enough to base selling decisions on. In addition, some "facts" may be vague, misleading impressions or folk tales of the "everybody knows that..." variety.
Marketing research focuses and organized marketing information. It ensures that such information is timely. It provides what you need to:
Reduce business risks,
Spot problems and potential problems in your current market,
Identify and profit from sales opportunities,
Get basic facts about your market to help you make better decisions and set up plans of action.
Friday, December 23, 2011
Things Change - Business Plans Must be Up-Dated
It's important to remember a fundamental fact about business plans: business plans become outdated very rapidly and, if not updated, lose whatever value they may have to a company.
In other words, business planning is an ongoing process and the written plan must be regularly revised if it is going to have continuing value. It is essential to review the plan on at least a quarterly basis and measure results against the plan.
The reality of today's world is that the pace of change is accelerating. What that means is that executives must be constantly making adjustments to their plans. As the pace of change speeds up, it is easy to lose sight of the business plan and simply make the necessary adjustments to the plan on a day-to-day basis.
One way to accomplish this task without being under the pressure of completely rewriting the plan each quarter is to establish priorities and implementation steps as part of the planning and quarterly review process
Another way to help the review and measurement process is to set target dates for completing various components of the plan.
The priorities and dates can be included at the end of each section of the plan or in a separate section at the end of the completed plan. In either case, they should be taken very seriously if they are to have the intended effect of helping in the plan review process. Deadlines have a way of slipping in many companies; simply pushing the dates back a few months at each quarterly review quickly renders the whole process meaningless.
Executives and other employees must be judged on their ability to meet the plan's deadlines. If adjustments or delays are necessary for valid operational or planning reasons, these must be discussed and analyzed.
Dust off your plan and make sure 2012 is ready to rock as soon as the calendar flips! See more business planning tips in Bolts of Lightening in The OED Community!
In other words, business planning is an ongoing process and the written plan must be regularly revised if it is going to have continuing value. It is essential to review the plan on at least a quarterly basis and measure results against the plan.
The reality of today's world is that the pace of change is accelerating. What that means is that executives must be constantly making adjustments to their plans. As the pace of change speeds up, it is easy to lose sight of the business plan and simply make the necessary adjustments to the plan on a day-to-day basis.
One way to accomplish this task without being under the pressure of completely rewriting the plan each quarter is to establish priorities and implementation steps as part of the planning and quarterly review process
Another way to help the review and measurement process is to set target dates for completing various components of the plan.
The priorities and dates can be included at the end of each section of the plan or in a separate section at the end of the completed plan. In either case, they should be taken very seriously if they are to have the intended effect of helping in the plan review process. Deadlines have a way of slipping in many companies; simply pushing the dates back a few months at each quarterly review quickly renders the whole process meaningless.
Executives and other employees must be judged on their ability to meet the plan's deadlines. If adjustments or delays are necessary for valid operational or planning reasons, these must be discussed and analyzed.
Dust off your plan and make sure 2012 is ready to rock as soon as the calendar flips! See more business planning tips in Bolts of Lightening in The OED Community!
Monday, November 28, 2011
Creating a Strategic (Emergency) Contingency Plan
None of us likes to think of the worst case scenario, but if the bizarre weather the East Coast has faced haven't taught us the need to plan, nothing will. Hurricane and floods affecting the ENTIRE state of NJ? Pre-Halloween blizzards taking out power? The following is a cross-post from Bolts of Lightening in OED's Community site. Read on and prepare BEFORE winter settles in with its snow, winds, ice, HVAC system chaos, and inevitable electrical issues that often ensue.
It's the kind of situation that none of us like to think about--a fire burns the headquarters or a flood damages inventory and closes Main Street. But it's the kind of situation every small business needs to be prepared for. We only need turn on the evening news on television to be reminded of the devastating consequences of fires, tornadoes, floods, and hurricanes.
The best way to prepare is to create a strategic contingency plan that will keep the business operating, even if only on a reduced basis, until the damage can be repaired or the business otherwise restored. Such a contingency plan need not be very complicated or involved. But it should answer certain key questions, among them the following:
· What are the most important elements to keeping this business operating?
For some businesses, like food or hardware stores, it is a matter of having inventory available as quickly as possible. For other businesses, like professional service firms, it is a matter of being able to get the professionals together to service clients. Whatever the most important elements are for your business, figure out what you would do if a natural disaster interrupted operations. Talk to your suppliers about what they would do, and with your key employees for their car phone numbers or addresses of close relatives.
· Where would we operate?
If your store or office were damaged, you need another place to set up operations. This might be in the owner's house, or it could be in a warehouse the company owns. The important thing here is to consider the options, and prioritize them if you have more than one choice.
·How would we communicate with each other?
In a flood or hurricane, especially, electricity and even telephone communication can be knocked out. Make sure you know everyone's home phone number and all employees' current addresses. Involve several people in the company in drawing up the contingency plan so that they are alert to the importance of communicating information about new location and hours of operation during an emergency.
· Do we have backup copies of important records?
In order for the business to be able to carry on in an alternative location, it should have access to its records. Consider what would happen if the records were destroyed or damaged by fire or flood. In today's age of computers, it is reasonably easy to have backup records of customer and supplier lists, provided someone is charged with regularly updating files. Old paper records should be regularly moved to an offsite location; this increases the odds they will be available in an emergency.
· Do we have all the insurance we require?
As just one example, you may want to be sure you have insurance covering you for loss of business time. This could provide critical cash to enable you to re-start operations.
The key issue in putting together such a strategic plan is anticipation. The key questions raised boil down to this: What do you need to continue operations, and how would you ensure that what you need is readily available?
It's the kind of situation that none of us like to think about--a fire burns the headquarters or a flood damages inventory and closes Main Street. But it's the kind of situation every small business needs to be prepared for. We only need turn on the evening news on television to be reminded of the devastating consequences of fires, tornadoes, floods, and hurricanes.
The best way to prepare is to create a strategic contingency plan that will keep the business operating, even if only on a reduced basis, until the damage can be repaired or the business otherwise restored. Such a contingency plan need not be very complicated or involved. But it should answer certain key questions, among them the following:
· What are the most important elements to keeping this business operating?
For some businesses, like food or hardware stores, it is a matter of having inventory available as quickly as possible. For other businesses, like professional service firms, it is a matter of being able to get the professionals together to service clients. Whatever the most important elements are for your business, figure out what you would do if a natural disaster interrupted operations. Talk to your suppliers about what they would do, and with your key employees for their car phone numbers or addresses of close relatives.
· Where would we operate?
If your store or office were damaged, you need another place to set up operations. This might be in the owner's house, or it could be in a warehouse the company owns. The important thing here is to consider the options, and prioritize them if you have more than one choice.
·How would we communicate with each other?
In a flood or hurricane, especially, electricity and even telephone communication can be knocked out. Make sure you know everyone's home phone number and all employees' current addresses. Involve several people in the company in drawing up the contingency plan so that they are alert to the importance of communicating information about new location and hours of operation during an emergency.
· Do we have backup copies of important records?
In order for the business to be able to carry on in an alternative location, it should have access to its records. Consider what would happen if the records were destroyed or damaged by fire or flood. In today's age of computers, it is reasonably easy to have backup records of customer and supplier lists, provided someone is charged with regularly updating files. Old paper records should be regularly moved to an offsite location; this increases the odds they will be available in an emergency.
· Do we have all the insurance we require?
As just one example, you may want to be sure you have insurance covering you for loss of business time. This could provide critical cash to enable you to re-start operations.
The key issue in putting together such a strategic plan is anticipation. The key questions raised boil down to this: What do you need to continue operations, and how would you ensure that what you need is readily available?
Friday, February 4, 2011
Is A Plan Enough?
OED Certifed Advisor Dana Komar discusses the need for planning, and the equally great need to revisit it to be sure it's as fluid as the world can be.
You have a plan…but that’s not enough to be successful in your business.
The only thing certain in life is uncertainty. How many times have you heard that saying? As a good business owner you know the way to manage uncertainty is to have a plan when it comes to all aspects of your business – strategy, marketing, operational processes, etc. Unfortunately, the reality is that only in the rarest of circumstances does your plan work out exactly as you want or expect it to. When this happens, it is very easy to let your pride take over and continue to forge ahead in the same direction you were going, even though it may not make sense anymore – like forcing a square peg into a round hole. This will certainly cause you to experience extreme frustration and discouragement, ultimately leading you to failure.
That is why simply having a plan isn’t enough. Your plan needs to be fluid and adaptable so that you can handle the unexpected as reality unfolds. The first thing to do is review your plan and ask yourself what could go wrong? How will you know if and when it does go wrong? You need to create observable measurements that you can use to monitor your progress and let you know if you are on the right track. Some examples are a revenue target, a budgeted cost, or a level of customer satisfaction. Come up with a list of adjustments you can make to put things back on track, depending on what could go wrong. This could include a list of alternative sales and promotion methods, other potential suppliers, or a variety of customer reward programs.
The most important things are to go through this exercise ahead of time and proactively review your progress along the way. Waiting until things go wrong to come up with a contingency plan increases your propensity to become frustrated and respond by sticking to your original plan no matter what. By preparing for a variety of circumstances, you will be in a better position to handle the situation as soon as it arises, which will allow you to maintain your momentum and focus. Just remember that in the end, it is better to be proud of your ability to adapt your plan, build on what you have already done and learn from your mistakes, rather than be proud of creating a plan that doesn’t work.
You have a plan…but that’s not enough to be successful in your business.
The only thing certain in life is uncertainty. How many times have you heard that saying? As a good business owner you know the way to manage uncertainty is to have a plan when it comes to all aspects of your business – strategy, marketing, operational processes, etc. Unfortunately, the reality is that only in the rarest of circumstances does your plan work out exactly as you want or expect it to. When this happens, it is very easy to let your pride take over and continue to forge ahead in the same direction you were going, even though it may not make sense anymore – like forcing a square peg into a round hole. This will certainly cause you to experience extreme frustration and discouragement, ultimately leading you to failure.
That is why simply having a plan isn’t enough. Your plan needs to be fluid and adaptable so that you can handle the unexpected as reality unfolds. The first thing to do is review your plan and ask yourself what could go wrong? How will you know if and when it does go wrong? You need to create observable measurements that you can use to monitor your progress and let you know if you are on the right track. Some examples are a revenue target, a budgeted cost, or a level of customer satisfaction. Come up with a list of adjustments you can make to put things back on track, depending on what could go wrong. This could include a list of alternative sales and promotion methods, other potential suppliers, or a variety of customer reward programs.
The most important things are to go through this exercise ahead of time and proactively review your progress along the way. Waiting until things go wrong to come up with a contingency plan increases your propensity to become frustrated and respond by sticking to your original plan no matter what. By preparing for a variety of circumstances, you will be in a better position to handle the situation as soon as it arises, which will allow you to maintain your momentum and focus. Just remember that in the end, it is better to be proud of your ability to adapt your plan, build on what you have already done and learn from your mistakes, rather than be proud of creating a plan that doesn’t work.
Wednesday, September 8, 2010
A Question for the Small Business Owner
If you decided to walk away from your business, could you sell it or are you “the business?”
This vexing question is posed by John Walters, OED Certified Advisor, and founder of 1-2-1 Business Consulting LLC. His insight below is eye opening for many a business owner!
Recently I visited two small businesses where the owners informed me that it was their intention to operate the businesses for another four to five years, sell off the businesses and retire on the proceeds.
However, upon further examination, it became apparent that the businesses could not operate for more than a few days without their owners; the businesses did not have the required processes in place to make them self sustaining. Without the owners, there will only be assets to sell when the owners come to retire.
Both businesses were probably worth between $150-200,000. Since the owners were thinking more in terms of $2million each, based on a multiple of 4, they are facing a huge gap and a bit of a wake up call.
When we began to discuss this issue further, it became apparent that the owners were spending significant time in the business. As such, they thought it only natural that they should make all the decisions.
This behavior in reality intensifies the problem – employees realize that there is little point in second-guessing what the owner may be thinking – they stop thinking for themselves and rely entirely on the owner. The opportunity for delegation is lost.
While it may be difficult to delegate tasks within a small business for any number of reasons, including cost, this must be done if the business is to become sustainable without the owner.
As a Business Owner ask yourself the following:
1. Do I really need to make every decision?
2. What can I delegate now?
3. What could I delegate if I give a little training to my employees?
4. What procedures can I put in place so that I do not lose control?
5. What are the vital few things that I must do personally?
6. At what stage should I bring in a manger to take over my responsibilities so that I may sell the business as a going-concern?
7. Do I really need to take every decision?
How you address these issues will ultimately decide if you have a business to sell as a going concern or simply a few assets to sell off. The value creation / destruction potential can be substantial. Think back to the two businesses that I referred to earlier that at looking at $150-200,000 vs. $2 million.
Please give careful consideration to investing in your future by making sure that you have sound Operational Planning, Succession Planning and Exit Strategies in place. The risk of not doing so is too great.
And, please remember that “121″ is there for you should you need any help.
This vexing question is posed by John Walters, OED Certified Advisor, and founder of 1-2-1 Business Consulting LLC. His insight below is eye opening for many a business owner!
Recently I visited two small businesses where the owners informed me that it was their intention to operate the businesses for another four to five years, sell off the businesses and retire on the proceeds.
However, upon further examination, it became apparent that the businesses could not operate for more than a few days without their owners; the businesses did not have the required processes in place to make them self sustaining. Without the owners, there will only be assets to sell when the owners come to retire.
Both businesses were probably worth between $150-200,000. Since the owners were thinking more in terms of $2million each, based on a multiple of 4, they are facing a huge gap and a bit of a wake up call.
When we began to discuss this issue further, it became apparent that the owners were spending significant time in the business. As such, they thought it only natural that they should make all the decisions.
This behavior in reality intensifies the problem – employees realize that there is little point in second-guessing what the owner may be thinking – they stop thinking for themselves and rely entirely on the owner. The opportunity for delegation is lost.
While it may be difficult to delegate tasks within a small business for any number of reasons, including cost, this must be done if the business is to become sustainable without the owner.
As a Business Owner ask yourself the following:
1. Do I really need to make every decision?
2. What can I delegate now?
3. What could I delegate if I give a little training to my employees?
4. What procedures can I put in place so that I do not lose control?
5. What are the vital few things that I must do personally?
6. At what stage should I bring in a manger to take over my responsibilities so that I may sell the business as a going-concern?
7. Do I really need to take every decision?
How you address these issues will ultimately decide if you have a business to sell as a going concern or simply a few assets to sell off. The value creation / destruction potential can be substantial. Think back to the two businesses that I referred to earlier that at looking at $150-200,000 vs. $2 million.
Please give careful consideration to investing in your future by making sure that you have sound Operational Planning, Succession Planning and Exit Strategies in place. The risk of not doing so is too great.
And, please remember that “121″ is there for you should you need any help.
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