Business Planning

27

Nov'18

How Do I Become A Successful Business Person?

That’s a wonderful question, because on one level, all you need to do is just study business in school, get the “trade school” education, get out there and do what your boss says. You will find a successful career if you have a half-wit sense of how to deal with people. You will never rise above a certain level, and you will be stuck in the trenches. You may rise to an assistant manager someplace. On the other hand, do you want to be very successful? Do you want to rise to the top of your profession? Then you better pay attention to a lot more than just B School topics. You must learn a lot about how businesses operate, how they rise and fall, how products are developed, produced and marketed. You must understand the legal environment, the social environment, and the political environment of business. You need to take every business course you can think of. You need to be an expert in communications, marketing, operations, human resources, accounting, finance and management. But with all this education, you will still only rise to a certain staff level. You are book smart, but not completely educated. Your excellent academic …

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27

Nov'18

New business: How do I get Visibility and Customers?

Ah, the proverbial question: how do you get customers. That’s what you want. Visibility, yes, but the only visibility you need is with people that will buy what you have to sell. Any other visibility is a waste of time and effort. In fact, visibility in the wrong venue can backfire: it may alert your competition, or inspire some other business to invade your space. So, you want to target your customers. Not with a shotgun, but with a rifle — send that message to the prospect and get them to buy. Too many entrepreneurs confuse noise with message. Noise is all around, does no good, doesn’t result in anything. Message is distinct, tailored, directed, and designed to emote action. So, how will you send an appropriate message directly to your target market in the most effective, efficient way? First you have to know a lot about your target market(s). You have to understand their demographics and their psychographics. Until you have this information, you are shooting in the dark. Then, you have to figure out how to reach those people directly. There is always a way. You have to understand the pathways of communication. Is it by social media? …

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31

Oct'18

What holds back a business from Scaling UP

What prevents most businesses from scaling up? Here are a few things: A personal service business where the owner IS the business. A business which is only successful because it has a unique location A business which has a limited supply of product. A business which can’t overcome the logistics of multiple locations/ increased sales either because there aren’t enough qualified humans or the business processes can’t or shouldn’t be automated. A niche business which serves a limited niche. Inadequate, ill-defined, or unworkable business systems, especially marketing, sales and customer service. Inadequate vision – owners can’t imagine scaling or comprehend what that involves. Inadequate funding Owners who know that being “big” doesn’t mean being better, and in fact being the “right size” is the best success a business owner can achieve.

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26

Oct'18

Key Factors for Success of a New Business

What are the key factors for the success of a new business? Everything you learned in Entrepreneur and Fast Magazine is probably wrong. Those magazines are pornography for business starters. This is going to be damn hard work. Harder than you figured, by a factor of 5. You can’t go home at 5. Most people just give up, exhausted and spent. Burn-out within 15 months is common. You are going to feel a lot of pain, anxiety, fear, angst and dread. If you can’t deal with it, if you’re not tough enough, it’s all over. Flame out comes sometimes within a year, most often after the 2nd year. You are going to have to plan things out. Which means you better do your research. Most available research is rubbish. You have to dig, hard. The vast majority of business plans aren’t worth the paper they are on. Business starters have to understand the dynamics of their businesses, and the key elements to success. Nothing happens until something is sold. Having the perfect product but no sales is guaranteed failure. You must sell, sell, sell. Oh, and did I mention, sell? You have to understand the 5 factors that make any …

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21

Oct'18

How does a New Business get Customers?

How does a new business get traction, get known, get customers? The answer is it depends upon your business… each business has a “most effective” marketing strategy. No two businesses have exactly the same approach. What you are in need of is a marketing plan. What follows is just a broad overview of some elements of a good plan. How do you attract customers? That’s the key. First, you have to know who your customers are or will be? Who are your target markets? What things are on their minds? What are their problems? What do they pay attention to? What are their habits? Demographics. Psychographics. How does your product or service solve their problem or need? Exactly. For example, you might say your coffee shop satisfies their thirst for coffee. WRONG. Your coffee house provides a certain ambiance, a place to meet people, relax, and enjoy a respite from the demands of the world. Ah, it is a refuge. You provide stress relief! ( I’m just making this up as I go along, the idea is to get you to thinking beyond the simple and into the subliminal and inferential.) Now that you know, what, figure out HOW. How …

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28

Sep'18

Can a Small Business Win Against National Companies?

How can small business owners compete & win when they are up against national companies? Direct, head on product to product competition: you can’t. They will smash you like a bug. Indirect, guerrilla marketing, niche specialty, solving un-met demands, appealing to consumers’ unique needs and desires: you’ll run circles around them, but you’ll have to be agile and nimble because if you are too successful or visible they will adopt your successes and roll over on you. (squished bug analogy again) You have to be clever. You have to be resourceful. You have to out-think them and out maneuver them. You have to go where they aren’t, whether it be location, product, service or customer demographics or psychographics. You also have to be constantly evolving. The only way same-old-same-old works is where the big guys are not interested in going. Example: a small retail store in a resort destination. You must keep your customers close to you, know them, understand them and market to and with them. Successful small businesses often share one thing in common: they have enthusiastic customers.

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22

Jul'18

What happens to Expenses Incurred before Incorporation?

What happens when you incur expenses before you have incorporated your company? There are three basic types: organizational, startup, and operational. 1. The organization costs and start up costs. These are the costs of setting up and forming the corporation. They have to be capitalized, a certain portion of each can be deducted, the balance having to be amortized. See https://www.irs.gov/publications/p535#en_US_2017_publink1000208919 In basic terms, up to $ 5,000 of organization and $ 5,000 of start up costs can be deducted in the year incurred, the balance amortized over 15 years. If the amount of either type of costs exceeds $ 50,000, then the 1st year write-off is phased out, $1 for $1. At $ 55,000 of costs, the particular costs ( start up or organizational) are fully phased out and can only be amortized. 2. The operational costs of running a business which existed before incorporation. In other words, you and some friends or you by yourself start a company. It’s an unincorporated entity that has expenses of operation before you decide to incorporate. I think your question is, what do I do with these expenses that aren’t start up and aren’t organization expenses. Expenses which aren’t start-up expenses, which …

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02

Jun'18

What do I Need to Know about Finance and Accounting for my Startup?

Knowing a number of basic finance and accounting concepts is essential to the success of your startup. At the bare minimum, you need to understand basic bookkeeping and preparation of financial statements, even if you are going to hire an accountant (recommended). You also need to understand the basics of finance and financial markets, as they impact the economy. Without this knowledge of finance and accounting you are running your startup blind. So, as a bare minimum, you need to master a beginning accounting and business finance class at the college level. I would suggest a local community college. You should also take a course in basic taxation, because you need to understand that. To be effective in running a business, you need these skills: (1)basic bookkeeping (2) setting up and monitoring internal controls (3) banking and credit including the way credit works, how to balance your checking account, managing cash (4) payroll, and payroll tax compliance (5) Sales, GST and VAT tax compliance (6) the basics of income tax (7) cost accounting, to the degree necessary to figure out what your product/service costs are, your overhead, and your margin under varying circumstances (8) how to read a financial statement, …

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27

May'18

Should I Go All-In and Invest All my Savings into my Startup?

All in? Invest everything you have into your Start-Up? No reserves except credit cards? Throw caution to the wind, jump onto that boat and make it float? If it springs a leak, use credit (borrowings) to float it for a while, until it finally floats? Eventually, sail off into the sunset with the gentle wind at your back, the beautiful girl at your side. I like the idea. Reality might be something entirely different. Do you have a business plan? Have you thought out what can ( and probably will) go wrong? Have you figured out how your competition succeeds? Have you really done the research to know what your costs and risks are? Remember, you are about to put real money into this… A true story may clarify. I have a good friend who started a business. At first they did very well. He upped the ante and put all his cash into it. Then the recession hit, and he weathered the storm, but incurred over $ 90,000 of credit card debt to keep it afloat. Limped along for several very stressful years. End of the story is he got lucky and found someone to buy the business for …

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25

May'18

How do I find the Right CPA?

Finding the right CPA or the right accountant is really important. Important because the results depend upon who you get, and it’s an area where you, the client may not be aware of whether you got the best advice or not. There are a lot of stuffy accountants (CPAs) out there who have very high opinions of themselves. They talk about “the firm” and act like they are something special. They tend to be rigid, unimaginative, high priced and advocate for themselves. There are also a lot of very friendly nice guys who are not very competent. They talk a good spiel, but they have neither the resources nor the experience to handle your problem. So how do you find the right CPA? What are you looking for? Lets see: 1. A hard-bitten no nonsense negotiator who can deal with the IRS at their level, knows all the audit tricks, has been there many times, a street fighter. 2. A clever innovative thinker who knows all the ins and outs of the law, understands the difference between light gray and dark gray, wants to take you to the limit of tax savings, but without crossing the line. 3. A plugger, …

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