Items tagged with SBDC Business Tips Articles
October 1st began a new program year for the ASU Small Business Development Center since we operate on a federal term. For us it is a time of recommitment to those we serve, the small business owner. As a team we will get together and revisit our values of integrity, excellence, service, and innovation to make sure our team is still aligned with these important values, which are the guiding lights for us. We will recommit to each other as teammates and then recommit to those we serve and make sure we are still aligned with their needs as our customers.
The advisors here at the Angelo State University · Small Business Development Center have discussed how important cash is to a small business. We have written articles on the need to analyze and manage cash flows. Today we are going to take a look at building a budget for your small business. For many business owners the process of budgeting is limited to figuring out where to get the cash to meet payroll this week.
Business budgeting is a very powerful financial tool available for any small business owner. Maintaining a good short and long range financial plan enables you to control your cash flow instead of having it control you.
The most effective financial budget includes a short range month to month plan for at least one calendar year. The long range plan should consist of a quarter to quarter plan and cover a period of at least three years.
As a small business owner, have you been asked lately, “What do YOU need?” If not, then let me say that there is a Texas group who wants to know. The Texas Small Business Needs Assessment Poll is a partnership between the Federal Reserve Bank of Dallas’ Community Development Department and the Texas Small Business Development Center Network. They are looking for your input!
In reviewing the 2013 results of the Poll, 66% of business owners expected overall business conditions to improve. The percentage of business expecting sales and revenue to increase was 71%. Most of the businesses responding were small businesses with one to five employees.
With millions of emails sent each day we sometimes forget the major role it plays in our daily business communication. According to the McKinsey Global Institute report the average interactive worker spends approximately 28 percent of the work week managing email. Knowing that email already has 28 percent of your potential client’s attention on a weekly basis, wouldn’t you like to make the most of it?
One key component of email that seems to go by the wayside is the email signature. In the world of online communication, it is key to take advantage of the many tools available to help you better communicate your company’s message and enhance your small businesses brand. Use your email to the best of its ability by always including the company’s email signature in every outgoing email to insure that your information is always available to contacts and potential clients.
Many entrepreneurs make the leap to business ownership without a clue about what is involved in opening a business.
For some, it is an easy process requiring little effort. For others, it is an arduous journey through governmental red tape, financial land mines and logistical roadblocks. And when these entrepreneurs get their business open, sometimes the first word they utter is “Finally!”
Their intent is: Finally, we are open! Or, finally, the hard part is over. Either way, the implication is that something was completed and a goal achieved. However, the word finally is wrought with danger for the new entrepreneur.
When people achieve certain goals, they are inclined to relax and enjoy the laurels of their hard work. So what is wrong with that? In general, nothing. However, we must examine our definition of success. Is it just to get our business open? Is it to achieve a certain revenue or income level? Alternatively, is it to operate a growing business for an extended period of time so that at the end of that time we can sell it for a profit or retirement?
Last week I had the opportunity to attend the annual America’s SBDC conference in Grapevine, Texas. There were three full days of intense learning about different industries and how advisors can use best practices to serve such industries. One of the workshops I attended was given by Rhonda Abrams, a successful entrepreneur that presented the topic “The Leap: The Next Level for Business.” Rhonda Abrams has conducted in-depth research with entrepreneurs in many industries throughout the country to identify the key factors contributing to their ability to turn small businesses into mid-sized companies. During the presentation Abrams talked about the importance of having a strategy in place to grow your business and leaving aside the fear of having to personally control everything to get this accomplished. In summary, these are the main points discussed during her presentation:
Are you thinking of starting a small business? You are already on the right track. There is a lot of thinking to be done before starting your own small business. Starting a small business can be a life altering event. Think of it as a marriage. Running a successful small business takes the same type of commitment and desire. You will be living your business 24 hours a day, 365 days a year. As with a relationship, if you want to be successful, you are going to have to work at it. It will have its ups and downs and surprises.
On the positive side, if you have the right temperament and a solid plan, starting a small business of your own can be extremely satisfying and exhilarating. Let’s take a look at a few aspects of starting a small business so you can make an informed decision about whether it is right for you.
Yes, it is true; your small business can sell to the government. The only thing standing in your way is learning how to “talk the talk.” The Angelo State University Small Business Development Center can help you understand the needs of federal, state and local purchasers.
Learn all about it Tuesday by attending “How to do Business with the Government.” The training session is from 9:30 a.m. to noon at the Business Resource Center, 69 N. Chadbourne St. Check-in will be at 9 a.m., and the fee is $15. Selling to the government is open to all businesses!
Small business owners will learn about requests for proposals, how to search for contracts specific to their products and services, and the value of forming team relationships.
September 1Many of us have heard about lean production or processes, which is the practice of driving out unnecessary costs not adding value to the customer. What is meant by adding value? It simply means adding value in a way the customer cares about. If customers do not see the benefit to themselves from certain costs incurred in your production or process, then it does not add value, in their eyes. You should try to eliminate or reduce the costs if possible. For example, using a well maintained older piece of equipment may be more cost effective than buying and using the latest expensive piece of equipment. Does the customer really care you are using older equipment? Most likely they do not and you are saving costs in the process.
Search engine optimization is a hot topic in the small business world today. We all want to know how to get the best rankings on search engines so our customers can find our websites and other resources with ease.
Unfortunately it is not as easy as 1-2-3 to improve your rank on different search engines. Do not fear — there are ways to improve your site to make it more readily available online.
According to Google’s Search Engine Optimization Guide, the key to improved SEO is to focus on the content of your site rather than gaining on different rankings. The guide says, “Search engine optimization is about putting your site’s best foot forward when it comes to visibility in search engines, but your ultimate consumers are your users, not search engines.” By improving various areas of information on your Web pages, search engines will be able to better categorize your content and make it easier to find in common searches; therefore, your rankings will improve naturally.
I spent some time last week driving the Texas Hill Country. The winding roads through the valleys and hills offered some spectacular vistas and views of wildlife. The problem with such a drive is that while you are driving, you have to pay particular attention to the road, so you wind up only getting snippets of the beauty and can’t really appreciate it in full. Appreciating the vistas too long will put you in danger of wrecking.
During this trip, I began to realize this particular road was much like one the entrepreneur travels as he or she builds and attempts to grow a business. The road has inclines, sharp turns, down slopes, and other dangers. Fortunately, the road through the Hill Country has warning signs for dangerous curves and inclines accompanied with instruction to decrease speed.
Are you significant?
Recently I heard the word, significant, used in conjunction with employees. The motivational speaker asked, “Do your employees feel significant?” The combination of the words “employees and significant” combined into one thought was an unusual combination and it took me a minute to wrap my thoughts around it.
Employees are commonly referred to as being valued, irreplaceable, important, empowered, happy, productive and a variety of other adjectives, but the single word, significant, carries its own unique connotation.
While one of our interns was doing some file compilation, he brought to my attention that I had a high influx of clients in May compared with other months.
He asked me, “What is the reason?” After trying to think of different reasons, my conclusion was that around midyear people have thought about starting a business long enough and maybe have received some extra money from their tax return to start the new journey.
But the million-dollar question becomes, “How much money do I need to start my business?”
Banks and other non-bank lenders are always willing to lend money on business loan deals that meet or exceed their lending requirements which are mostly built on the 5 C’s of credit analysis.
The 5 C’s include collateral pledged, capacity to repay, character and experience of the borrowers, conditions in the industry and economy, and lastly capital or the amount the borrower intends to inject in the business. Besides your personal funds and funds from friends and family, banks are your best source for start-up loans and we recommend approaching them first for the lending needs of a small business. It is also important to establish a banking relationship, even if you do not initially have a bank loan to start your business.
My dad grew up on a cotton farm learning to drive and maintain farm machinery. When his dad retired from farming during my dad’s high school years, he moved the family into town. Dad went to work in an automotive repair shop across the alley from his home. It was from his farm experience and his work in the repair shop that he learned the importance of properly maintaining engines. It was something that he worked to instill in his children.
Before I ever received my driver’s license, I knew how to check the oil and other fluids in our family car. I learned how to change a flat too. After getting my license and taking possession of a family car as “my” car, dad would periodically ask me if I had checked the oil. He knew and taught me that an engine needs oil and it needs new oil and filters periodically or the engine will be ruined. Even after I bought my first car and started college, he would ask, “Have you checked the oil?” He was especially inquisitive of this if I was about to leave town to return to college or take trip with friends. Naturally, this eventually became irritating to a teenager and eventual young man.
As an owner of a small business sometimes little time is given to the “formalities” of managing a business and certain areas tend to be overlooked.
Performance reviews are a good example. Often, business owners work under the everyday evaluation policy without ever having a formal evaluation period; therefore, important information is missed causing potential larger problems in the business.
It is well-known that employers who hold some sort of evaluation to review employees performance yearly gain tremendous benefits. Unfortunately, the word “evaluation” usually has a bad connotation because most people will think of an evaluation as the time to bring up failures or shortcomings.
There comes a time as a small-business owner that you can’t seem to do anything right for your company.
This can be quite frustrating. Maybe you are waiting for a call or for a customer to get back into town. Perhaps it is a product you are waiting for or a service that needs to be provided. There are many reasons why we get stuck and are unable to go anywhere.
Don’t panic or do something rash. Sit down and reflect on the situation. Try to calm down and make sense of what should be done next.
A rushed and panicked mind leads to mistakes. If possible take a step back, take a deep breath and gather yourself before making decisions when in the wrong frame of mind. You don’t want to do something that you will regret.
I watched as the manager leaned in to speak with his employee who was answering the telephone. As the employee began to respond to the caller, the manager spoke softly, “Manage expectations.”
As the phone call progressed, it was evident the manager was coaching the employee how to be successful in providing all the information the caller would need prior to their arrival — managing expectations.
Managing expectations helps to maintain smooth transactions. As a former furniture store owner, we held true to the statement, “Under-promise and over-deliver.”
We witnessed the power of networking and connections recently among existing business owners, especially those having a track record of solid sales and a commitment to grow. Some call this type of business a Stage 2 business. Stage 2 growth businesses have different needs than a Stage 1 startup business. One of those needs is to connect more with other business owners, the need to network and develop partnerships.
We ran a 10-week course at the Business Resource Center (BRC) for 10 local Stage 2 businesses who wished to explore ways to grow. The course, FastTrac Growth Venture, included a textbook that covered the major areas of knowledge businesses in this stage need to know to be successful.
From a business perspective, what is branding?
We know that from an agricultural and livestock perspective, it is the marking of animals to indicate ownership or pedigree. The branding of animals began centuries ago and over the course of time was extended to paper as watermarks, silver and other products to indicate manufacturer. These became known as some of the first trademarks and were referred to as their brand. Thus, branding could be considered building an identity for your business, or creating a mark that becomes synonymous with your business.
The dream of every business owner is for business to be able to expand, but when your business grows from day to night it can be scary.
Like children, when they grow and suddenly no clothes fit them, you feel overwhelmed by the idea of what you could do to fulfill all the needs of your growing child/business.
The current market environment San Angelo and nearby towns are experiencing is challenging, fast growth in a short time. Currently small businesses feel pressure to grow too fast to meet clients’ demands and be able to compete in the market. This accelerated growth has created stress in business owners and has driven them to make expansion decisions often without the necessary planning. And, unfortunately, this accelerated growth can jeopardize the business’ future.
In a recent blog post, I came across some startling statistics: 40 percent of U. S. workers are planning to look for a new job in the next six months, and 69 percent say they are already passively looking.
To a small business employer, those figures are staggering. We are careful to hire only the best employees, and once we have them, we want to keep them. There are huge benefits for employees to stay with the same company for 10 years. Employers need to know what steps to take to make workers want to stick around for years.
Proactive efforts by employers to establish a culture that builds strong relationships with their employees — the kind that leads to a lengthy commitment, and perhaps even a commitment for life — are what we are seeking.
“The goal to be reached is the mind’s insight into what knowing is. Impatience asks for the impossible, wants to reach the goal without the means of getting there.” Hegel 1770-1831.
This poster, neatly framed, hangs in my office to help remind me my job is to help my clients reach their goal by helping them prepare.
Preparation is the “means of getting there” and the Angelo State University Small Business Development Center offers the training to prepare you so you can reach your goal. Without a basic foundation in the tools and vocabulary of business, it will be you who “asks for the impossible.”
We have seen an increase in businesses for sale recently, and I am sure it is partly because of the baby boomer generation of business owners wanting to cash out and transition their business to someone else.
Buying a business can be an exciting and apprehensive task. An existing business usually has a solid customer base and can provide immediate cash flow. Systems and procedures are mostly developed. Employees are most likely well trained and have good knowledge of their customers and business operations. These things are already in place that someone starting a new business would have to build or create.
As exciting as this seems, there may be some unanswered questions. Is this business right for you? Why is the owner selling? Are the financials accurate as presented? Will there be hidden land mines that you as the new owner will have to face?
I enjoy reading the posts on Facebook of a high school principal.
I know a number of educators and am “friends” with them on Facebook. However, not one of them is more active on Facebook and Twitter than he is. In fact, it would be fair to say he is more active than my own school age children are.
Why would a 60-year-old school principal (I can say his age because he posted it on Facebook!) be active in social media? Because he loves children and he wants to be where they are. He uses social media to make school announcements such as snow days or calendar events. He reminds them of dress code rules. He praises their accomplishments with lofty eloquence.
We often find ourselves looking for feedback, such as reviews on places or things of interest to make sure we are making the right decision or that we will make our time and money worth the while.
Therefore, as business owners you are aware of the importance of customer reviews on your websites, social media and even word-of-mouth comments.
Sometimes being able to handle all the feedback you received from clients can be challenging, but I guarantee it will be worth your time.
Is training important for small businesses? The answer is a resounding yes.
Everything is important to small businesses. Any organization, small or large, can’t afford to stress one or two areas and let another slide. Training is important. It teaches new techniques and reinforces old ones. Every member of your team needs both those kinds of support. Sales training enhances the one area where small businesses have an advantage — the person-to-person connection. Give your sales staff the tools and training to be available to customers at any time.
As it is said, “I know I’m preaching to the choir,” when I say that customers will help you build and grow your small business. Business owners constantly work to get referrals from their customers but sometimes it is good hear about and explore different techniques which may sharpen your skills.
Last week I had the privilege of listening to a successful local entrepreneur speak about the reasons for his success and the success of his companies.
He reminded us of the importance of listening to your customers, to give them what they want and need with value to them and a profitable relationship for the business. How do you listen to your customers? Below is a brief discussion on how business owners can listen and take action.
As a small-business owner, what is your objective?
It is to separate your customers from a portion of their money. That is the bottom line. You found a service or product they want or need and you will sell it to them for a price. They have what you want. You have what they want.
The catch is in the question: are you the only one from whom they can purchase that service or product? Chances are you have competitors. In recent articles, we have discussed competitive advantage. When we discuss competitive advantage with our clients, pricing often comes up as the advantage as does product or performance quality.