Hold Onto Your Cash for a Healthy Business

The U.S. Department of Labor estimates 50 percent of U.S. businesses fail within the first five years. The primary reason is poor cash management, the U.S. Small Business Administration (SBA) cites. Good cash management is about keeping your cash as long as possible, and convincing your customers to pay promptly. Keeping a few cash management principles in mind will help you keep a healthy business and stop you from becoming just another statistic.

The Confusion Over Profit

Profit and cash flow are related but not equal, stresses Inc. Your profit and loss statement gives you the simple results of revenue minus expenses. A positive result is considered profit, but you can’t tell how healthy your cash flow is by just seeing a profit. Areas you need to watch include:

  • Accounts Payable
  • Accounts Receivable
  • Inventory
  • Capital expenditures
  • Level of debt

If customers are slow to pay, resulting in a high receivables, you could see a profit on the books, but a lack of cash in the bank. You could see a profit on paper, but not be able to make payroll or pay your suppliers.

Getting the Bigger Picture

You need to have visibility into your cash flow to know where your company stands, and where you might be in a week, month or year. Future cash flow prediction is an educated guess based on the trends you see in the areas mentioned above, says Entrepreneur.

As soon as you can, get your business onto a consolidated system, so you can easily see the patterns in your business. Cloud-based applications, such as the retail management software from NetSuite, bring together both your online and offline activities to give you a complete picture. Relying on spreadsheets or different applications to track online and offline channels makes it painful to bring the data together so you can accurately predict your cash flow.

When you have the complete picture, you’ll have visibility to such trends as:

  • The payment history of your customers
  • The accuracy of your planned expenditures
  • The ability to cover unplanned expenditures

Without the consolidated view of your performance data, you won’t be able to make those educated guesses needed to plan for your company’s future.

Managing Receivables

Ideally, all of your customers would pay for your products and services at the time of the sale. That won’t necessarily happen as your company grows and increases the customer base by offering credit and special terms. Increase your cash by bringing in more customer payments:

  • Give a discount for paying bills early
  • Request a deposit when an order is taken
  • Get invoices out quickly, and send reminders at 30-, 60- and 90-day intervals
  • Once you’ve identified slow paying customers, put them on cash-only terms

Small business owners don’t like the idea of being a bill collector, but the SBA suggests you should do all you can to get something from the customer, because third-party agencies take at least a 30 percent cut if they are successful. Giving discounts as an incentive for payment will let you keep more of the cash in your pocket.

Managing Payables

Keep your cash as long as you can. This improves your cash outlook, especially to banks and investors.

  • Use your supplier’s credit terms whenever possible
  • Make payments on the last day of your vendor’s cycle — day 29 on a net-30 term
  • Use electronic funds transfer (EFT) whenever possible
  • Communicate with your suppliers, and build rapport in case you need a break to delay a payment
  • Select vendors to work with that have the best terms for your cash flow, not necessarily the lowest prices

Talk to a Factoring Broker

A factoring broker is someone who purchases your invoices, so you use the cash flow immediately for things like making payroll or purchasing needed equipment for the business. This is an excellent solution especially when traditional means of borrowing aren’t available. A factoring broker I highly trust and recommend is Jack Wilson.

A healthy cash-flow is integral to helping you grow your business to the next level. You need cash flow to allow you to hire top talent, beef up your marketing and upgrade your systems. As the saying goes, “you need money to make more money”.

QUESTION: What is your biggest challenge when it comes to increasing your cash flow? Please share your comments in the box below.

© Copyright 2016

Business Skills for the Consultancy Start Up

Note From Yoon:  

It’s interesting the uptick I’ve been seeing of people leaving the corporate world to start their own consultancy firm or solo consulting practice. I’d say half of my consultant clients fell into becoming an entrepreneur after becoming a victim of wide spread lay off’s. The other half of my consultant clients chose to leave the corporate world in pursuit of a better work life balance… (this cartoon strip I found says it all!). 
Work Life Balance CartoonBoth would unanimously agree that keeping their high paying executive jobs became more and more high pressure with grueling demands on their time. 
Starting your own consulting practice can be very rewarding giving your full reign over your time and income. In today’s article I want to share with you some tips for the consultancy startup. 
 
Enjoy! 
 
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Business Skills for the Consultancy Start Up

It may seem tempting to launch a consultancy startup rather than go to work for a traditional business. You’re your own boss, and all that you need is a group of fellow fledgling entrepreneurs, a dry erase board, a dream and a little seed money to put your innovation into action.

However, the real truth is that the lean startup model has a success rate of about 25 percent, according to research by Shikhar Ghosh, a Harvard Business School lecturer. If you are exchanging a steady shot at a corner office for a high-risk-high-reward startup consulting venture, you may need to assess your business school training to ensure you have the right stuff.

#1. Soft Skills: Maintain professionalism

 

You may have heard stories about Google programmers who walk around Silicon Valley wearing old T-shirts and long underwear because they are so valuable to the company. With a reputation for cultural creativity and out of the box thinking, startups can be more compelling than the traditional corporate model, but you have to learn the rules before you can break them.

  • Be on time.
  • Dress your best.
  • Confidently present yourself to potential colleagues, clients and investors.

In a competitive startup culture, keeping these areas tightly organized on your own without corporate pressure guiding you is challenging and essential.

#2. Select compatible colleagues
 

In a startup, you need to take on the a human resources role and decide who will complement your skills and accomplish your mutual goals together. Search websites that can help you network and meet someone with similar business plans. Such as:

#3. Reduce the scale: short-term analysis

 

In the beginning stage of a startup:

  • Launch the research and development
  • Acquire potential customer feedback
  • Make iteration changes daily

This is different than the analysis and planning you learn in business school intended for established businesses with a long-term outlook and slower, sustainable changes. If you try to logically find a solution from beginning to end on a dry erase board, the long-term projections will fall flat in the testing and development phase. Implementing quick changes is part of the inherent high risk and reward model.

#4. Accounting


Accounting is the same. Business schools often use three-to five-year financial projections, NYU B-school graduate Brett Nelson told “Forbes” magazine. Some businesses actually use 30-year projections. A startup can estimate the cost of salaries and office operations, but in the beginning the cost of producing the product or service, compared with the return on investment, is more intuitive than planned.

A startup usually has a lower seed cost than a brick-and-mortar new business because the model begins small and eventually advances with technology and mass implementation, which is where the investor money comes in.

At that point you will need to:

  • Hire the attorney, accountant, insurance agent and other professionals
  • In the beginning, bring out the dry erase board and your colleagues, and get to work! Explore all options and opportunities. What are your goals? What are your colleagues’ goals?
  • Include business insurance that not only protects your assets, but also offers coverage for particular issues that a startup may be susceptible, such as data breach and interruption insurance.

Keep in mind also that your MBA skills will begin to pay off once a startup begins to grow into a larger version of itself that resembles the scale of a larger corporation. In the meantime, shelve the long-term planning and focus on the tasks at hand, one day at a time.

QUESTION: What one business skill has been vital to you succeeding as a startup consultant? 

About Yoon Cannon: Top business coach Yoon Cannon has helped thousands of small business owners, entrepreneurs, coaches, consultants and sales teams achieve dramatic results in growing your business. Over the past 20 years Yoon has started 4 successful companies and sold 3 of them. She offers fresh insights as a seasoned business growth expert. Yoon delivers proven process for your sales, marketing and management development.  Grab free valuable gifts and resources at https://www.ParamountBusinessCoach.com  To book Yoon to speak at your next event email: YoonCannon@ParamountBusinessCoach.com To schedule a complimentary business coaching consultation call (215) 292-4947. 
© Copyright 2016

6 Traits of Successful Entrepreneurs

successful entrepreneurs

 This of photo of successful entrepreneurs was taken at the Future 50 Awards gala event produced by SmartCEO.
You can imagine the energy in a venue packed with high achieving entrepreneurs as we celebrated the top winning companies.
I firmly believe in the power of goal setting. If you’re not on fire about your business right now, perhaps you need to find the right goal to focus on achieving. Winning a specific award is a great goal to start with. Enjoy today’s article on developing the 6 success traits to help you win big in your business.

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6 Traits of Successful Entrepreneurs

As an entrepreneur what milestones do you want your business to achieve?

What would be some great wins for you?

For many of my clients, they describe their big wins as achieving awards like Inc. 5000 Award, Future 50 Award or the Philly 100 Awards.

Other types of wins I enjoyed were things like hitting my first Million dollar milestone in sales. Another great win for me was doubling my business 4 years in a row and selling 3 of my companies for an exciting profit.

What about you? What are your winning goals in your business?

What are you fired up about achieving?

Whatever your goals are for your business remember that ultimately, companies don’t succeed. People do.

I’d like to share what I find are 6 common success traits among the people behind winning businesses.

Success Trait #1. Sets specific, measurable goals.  As a business owner you have to know how to motivate yourself. Simply articulating that you are “just going to do the best you can” is not a measurable goal. Focus on making your goals results driven, so it is a clear objective assessment of whether you achieved the goal or you didn’t.

What is one goal you would be completely fired up about hitting this year?

Success Trait #2.  Knows the “WHY”  Setting specific goals answers the “what” you’re working to achieve. You also need to answer for yourself the “why”.  What will achieving the goal do for you? What will it allow you to have that you don’t have today? What will it allow you to do that you are not able to do today?

Perhaps you might be a new coach or consultant and your goal is to simply generate a $100K income this year.

Your personal why statement might be because that would allow you to work 4 days a week and enjoy work life balance without financial stress and worry.

What is the #1 change you want in your life right now that you currently do not have and why do you want this change?

Success Trait #3. Practices patience and discipline. Running a business is not easy. Running a successful business is even harder. Successful people know that even with talent, hard work, training and the best laid plans, achieving the winning results will still require patience and discipline through cycles of trying, failing, and trying again more intelligently.

Any time I hit a wall of frustration in working towards a new goal I remember the wise advice from the famous artist Michelangelo.

“If people knew how hard I had to work to gain my mastery, it would not seem so wonderful at all.”                        — Michelangelo 

What is one discipline in your business do you want to commit to practicing?

Success Trait #4.  Leverages your core area of competency.  The temptation for many small business owners is to wear all the hats. Sports teams could never succeed with this approach, so why whould it work any differently for business success?

Every player has a specific job and role within the team. In soccer, the striker would never lead his team well if he is trying to play defender, center forward, goalie and striker.

Successful business owners resist the temptation that just because they can do certain tasks means that they should do them. They don’t try to wear every hat and be the bookkeeper, the administrator, the receptionist, the office manager, sales manager, HR manager and the PR agent. If you have tried to do this I’m sure you found that it only diffused your effectiveness.

What then is your #1 core area of competency that you enjoy doing best?

Success Trait #5. Gets help on everything else.  Successful people solicit help in 2 ways. They seek the guidance and advice from a business advisory team of several experts or from one main person to serve as a sounding board, offer feedback, push back when needed and strategic advice.

Successful people also solicit help from others who they can delegate or outsource to.  Even if you are a solo practitioner like an attorney, financial advisor, coach or consultant you should be outsourcing to contractors to do tasks that do not fall in your core competencies.

What is holding you back from getting help?

Success Trait #6.  Hungry to learn.  The definition of insanity is doing the same thing week and week out while expecting different results.

If there’s anything you can count on it’s change. Consumer behavior changes. The economy changes. The landscape of competition in your industry changes. Technology is always changing. Successful business owners would not have been able to thrive amidst the change curve if they were not people who were hungry to learn.

What is one thing you need to learn to help you respond successfully to a change or need that’s happening in your business right now?

In closing, remember again that companies don’t succeed. People do.

I shared 6 key questions as an important exercise for you to not only work on your business, but work on yourself.  I invite you to take a few minutes to share some of your answers below. I look forward to your comments.

Here’s to Your Success!

Blessings~

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About Yoon Cannon: Top business coach Yoon Cannon has helped thousands of small business owners, entrepreneurs, coaches, consultants and sales teams achieve dramatic results in growing your business. Over the past 20 years Yoon has started 4 successful companies and sold 3 of them. She offers fresh insights as a seasoned business growth expert. Yoon delivers proven process for your sales, marketing and management development.  Grab free valuable gifts and resources at https://www.ParamountBusinessCoach.com  To book Yoon to speak at your next event email: YoonCannon@ParamountBusinessCoach.com To schedule a complimentary business coaching consultation call (215) 292-4947. 

 

© Copyright 2016

 

Take Inspiration from 3 Fortune 500 Men

!cid_06B63769-2E1B-442E-9F28-BBCBC94247AE@westellNote From Yoon:

I’ve been taking Richard Branson’s advice. While I don’t have a hammock, my favorite relaxed spot to work is on my front porch chaise lounge. 

This is where I usually take my coaching calls. I follow the sun, so I end up moving to the side porch, then to my back porch.  Being outdoors is definitely a more fun place to work! Thanks for the tip Richard! 

What about you? Share your best success tips you’ve learned and implemented below.

Blessings ~ 

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There is no such thing as a black and white path to success. The road to a successful future is bumpy along the way, but that doesn’t mean it’s impossible to achieve great things. Sometimes the most unlikely advice is all it takes to catapult you towards greatness. Follow the unlikely advice of these Fortune 500 men, and you can take a step on the path towards your dreams.

Richard Branson: Virgin King

Sir Richard Branson in Vancouver

Photo by Shinsuke Ikegame via Flickr

Richard Branson has it all: a multibillion-dollar empire, his own private island and a great head of hair, but what’s his secret? Branson told Askmen.com that one of his secrets of success is to work from home whenever possible. A hammock is a much more fun place to work than a stuffy office desk, and working from home allows Branson to minimize distractions and focus on the task at hand.

Bill Gates: The Ruler of PC Land

Bill Gates

Photo by Choice Isy via Flickr

Bill Gates pretty much runs Silicon Valley these days, and he owes much of his leadership ability to his parents. They forced him to participate in activities that don’t come naturally to him. He tells CNN Money Magazine that one of the most important parts of his childhood was learning to stretch out of his comfort zone. He may not have been the best athlete, but he sure made some important memories trying.

Steve Wynn: Big Winner

Steve Wynn at the Milken Institute Summit-London

Photo by MilkenInstitute via Flickr

Steve Wynn isn’t just a hotelier, he is “the” hotelier, and he owes it all to the way he treats people. In his seminars, Steve Wynn explains that his business motto is anything that brings immediate gratification will be repeated, and he uses it to ensure his employees and guests feel taken care of. This way, he builds a loyal fan and employee base that has his back.

What about you? Share your best success tips you’ve learned and implemented below.

 

About Yoon Cannon: Top business coach Yoon Cannon has helped thousands of small business owners, entrepreneurs, coaches, consultants and sales teams achieve dramatic results in growing your business. Over the past 20 years Yoon has started 4 successful companies and sold 3 of them. She offers fresh insights as a seasoned business growth expert. Yoon delivers proven process for your sales, marketing and management development.  Grab free valuable gifts and resources at https://www.ParamountBusinessCoach.com  To book Yoon to speak at your next event email: YoonCannon@ParamountBusinessCoach.com To schedule a complimentary business coaching consultation call (215) 292-4947. 

 

© Copyright 2016

How Small Businesses Can Gain Competitive Edge

One of the questions I hear most often from SMB’s is “how can I gain business among so much competition?” I say don’t focus on gaining the business. Focus on gaining competitive edge, and it will lead to gaining more business.  How does one do that?

Well, I believe we all have an edge. Some of ours are just more dull than others. So, gaining a competitive edge begins with staying sharp.

Let me share a story I heard years ago. Two men were splitting wood. One of the men was tall and muscular and in excellent physical shape. The other man was shorter and much less muscular and appeared to be no match for the larger man.

The two men began chopping wood at the same time. When the first coffee break rolled around, the smaller man took a break while the larger man continued to split the wood. The larger man did not join the smaller man during their lunch break or afternoon break either. Instead, he continued to split wood all day long.
In the evening the smaller man went home, but the larger man continued working late into the night.
Their routine continued for nearly two weeks.

The larger man did not understand how the smaller man’s pile of chopped wood was roughly the same size as his when he was clearly stronger and had worked longer hours than the smaller man.

After about three weeks the smaller man’s wood pile was even with the larger man’s wood pile. After four weeks, the smaller man’s wood pile had surpassed the size of the larger man’s wood pile. The larger man was astonished and confused.

One day, as the smaller man was about to take another break, the larger man said to him “I cannot understand why you have more wood split than I do. You are smaller than I am, and you don’t have the strength that I have”. The smaller man replied “Ah yes, my friend, but you never stop to sharpen your axe”.

When it comes to getting the job done, your greatest tool is your own mind. Here are 4 tips to help you keep your mind sharp as a small business owner:

1) Make the most of your peak performance time Figure out the time of day when you are most energized and focused. Are you at the top of your game first thing in the morning, or are you ready to go after your second cup of coffee? Whatever your peak performance time may be, make sure that you schedule your most complicated tasks during this time of the day. The extra brain power will bring clarity and concentration.

2) Make a to-do list A to-do list lets you focus on the task at hand instead of trying to remember your mental list of the tasks to be done. Writing down your objectives for the day helps you stay focused on your key result areas. It also keeps you from feeling unproductive. One of my clients recently took a trip to NYC with his team to explore opportunities to expand his fast growing food and hospitality business. He later told me how disappointed he was that didn’t feel they accomplished much after a 12 hour day together. I asked him, “What were the key objectives you planned for the day?”  He replied, “I didn’t have any clear, set objectives.” His to-do list stopped with a decision to go to NYC which wasn’t clear enough. Make sure to-do list items like this also include what your most important goals are to accomplish.

3) Always be learning. If you want to gain the competitive edge you need to be willing to continue to up-level your skills and knowledge. I’m not talking about trying to be the “Jack-of-all-trades” type of person. I’m also not referring to setting yourself up for complete information overwhelm where you end up not being able to focus on your core competencies.  What I am saying is to choose one new important trend to learn more about or skill to hone that is effecting your industry. Those aha moments often occur when you’re in the midst of delving into new subjects, skills and technology.

4) Leave Work at Work I find that business owners tend to be type “A” personalities. You’re character trait to keep on pushing yourself is a large reason why you’ve succeeded thus far. But, be careful because your “strength” can also prove to be a double edged sword which is when we end up hitting the point of diminishing returns. You send in your car for regular maintenance checks. You power down your computers because even a piece of machine needs to rest to reboot. When you go home at the end of the day, it’s time to give yourself permission to leae the work on your desk. Spend time with family or friends and allow your mind to be present, not drifting back to thoughts about work.

I have always found that it’s much more exhausting thinking about work, than the energy it takes to actually get that work done. Your mind needs time to rest, re-energize and refuel — part of the process of sharpening your axe. So, commit to start each day refreshed, ready and re-sharpened to get the job done!

QUESTION: What do you do to keep your skills and your mind sharp as a small business owner?  Please share your ideas in the comment box below.

About Yoon Cannon: Top business coach Yoon Cannon has helped thousands of small business owners, entrepreneurs, coaches, consultants and sales teams achieve dramatic results in growing your business. Over the past 20 years Yoon has started 4 successful companies and sold 3 of them. She offers fresh insights as a seasoned business growth expert. Yoon delivers proven process for your sales, marketing and management development.  Grab free valuable gifts and resources at https://www.ParamountBusinessCoach.com  To book Yoon to speak at your next event email: YoonCannon@ParamountBusinessCoach.com To schedule a complimentary business coaching consultation call (215) 292-4947. 

© Copyright 2016

Strategic Planning Tip – Staging Your Business to Succeed!

Stage Your Business to Succeed!

“If you keep on doing what you’re doing, you’ll keep on getting what you’re getting. If you want to get something different, then you need to do something different”

Strategic Planning Tip - Staging Your Business to Succeed!Profound quote isn’t it? …. So, of course, the translation to your business is, if you want to achieve different results by this time next year, you need to take a different approach from how you’ve currently been doing things in your business.

This is the key reason why it is critical for you to do a strategic plan each year for your business regardless if you are a Fortune 500 company, a small family run business, or even a solopreneur. Your strategic plan is your written road map that will help keep you from falling into the same ineffective patterns of behavior and from repeating out dated systems that are no longer worth your time and investment.

Better than that, your strategic plan is your road map that keeps you focused on what things you will now commit to doing differently this year — designed to getting you greater results than ever before.

You know, every time I share the opening quote with business owners and Entrepreneurs I find that 100% of them agree with the truth of this principle. But, you know what? I find that less than 10% of the small business owner audiences I speak to actually have a strategic plan each year.

The 3 biggest reasons I hear all the time from small business owners and Entrepreneurs on why they do not do strategic plans each year is:

1. It seems like an exercise in futility for me to set goals and milestones on paper when things in the past never went according to plan anyway.

2. Doing a strategic plan seems like a large daunting project that I frankly don’t have those large chunks of time to be doing.

3. I don’t know where to start in creating an effective strategic plan

Alright, so let me try to de-bunk some of these limiting beliefs, so that I can help you to accelerate your business growth in 2012.

 

First, think of your strategic plan as a staging plan.

 
Strategic planning is not just a piece of paper that shows you’ve written down a bunch of numbers and dates on when you would theoretically like to see those numbers and figures achieved by.
So, if you could have a do-over of this past year (knowing the cause and effects of each of your decisions)…
     1.) What would you put on your short list of things you want to do the same?
    2.) What would you put on your short list of things you would do differently?
That said, you don’t want to be answering those 2 questions for your business as a whole, you want to segment your post-mortem thoughts as you would address a house room by room.Take the analogy of selling a house. In today’s difficult economy, there are an awful lot of homes on the market.

So, if you’re the seller, you’re going to need to maximize the staging of your home to stand out from all your competition. There are so many other homes your buyers have to choose from!Your realtor or your staging consultant will walk you through room by room with their recommended list of changes you should make to maximize your home’s appeal to the type of buyer you are targeting. The homeowner typically, will have 2 common responses to the staging plan:a) Yes, I’ve been meaning to do that for years, but just haven’t gotten around to fixing that yet.

b) No, I never noticed that was a problem (because I live here I just get used to it and have grown immune to noticing that horrible wallpaper throughout the house)

When the homeowner follows the staging plan, he/she watches their home magically transform from drab to becoming the next coveted hot seller.

That’s what your strategic plan does for your business. It should serve as your room-by-room improvement list that will help you to attract more targeted buyers.

It can do even more than that. Your strategic plan is there not just to achieve your sales goals, but all your other business-related goals — like, here’s one I help small business owners with a lot: I want to work 10-20 hours less per week this year but still increase my profits.

Yes, I can help you formulate what you roadmap should look like in your 2012 Strategic Plan to help you achieve that goal of working less while still growing the business so you’re earning even more.

Now, as for the other 2 objections for not doing a strategic plan:

  • Not thinking you have the time
  • Not knowing where to start

You give me 1 hour a month and I’ll show you how to stage your business to have your best year ever!

If you truly want to achieve better results this year in growing your business and you are ready to commit even just one hour a week, I have a simple 1-page strategic plan system that I can hold your hand step-by-step and guide you to do.

If you’re interested in learning more about how you can invest 1 hour a week using my 1-page strategic plan system, I invite you to call me for a no-charge 30-minute discovery session to explore what that could mean for you.

But, hurry on calling me. Because good intentions often turn into wasting years from procrastinating on what you could have easily and quickly done today.

Why not call me now? My direct line is 215-292-4947 EST.

QUESTION: What is the most challenging part of working on your strategic plan to help you grow your business? Please share your comments in the box below.

About Yoon Cannon: Top business coach Yoon Cannon has helped thousands of small business owners, entrepreneurs, coaches, consultants and sales teams achieve dramatic results in growing your business. Over the past 20 years Yoon has started 4 successful companies and sold 3 of them. She offers fresh insights as a seasoned business growth expert. Yoon delivers proven process for your sales, marketing and management development.  Grab free valuable gifts and resources at https://www.ParamountBusinessCoach.com  To book Yoon to speak at your next event email: YoonCannon@ParamountBusinessCoach.com To schedule a complimentary business coaching consultation call (215) 292-4947. 

 

© Copyright 2016