Are you managing costs? So many small businesses I know have great intentions, but they operate on a fine line between keeping the costs of doing business under control, and getting swamped when unexpected bills crop up.
The trick, according to Avron Newstadt, of Expense Reduction Analysts, is to get into a cost management mindset.
If you can say 'yes' to the following statements, then you are a business that has the potential to manage your costs well:
* You dedicate ongoing and regular time each week to the principle of cost management
* You have developed a cost management culture in your business, so that your staff know it's important
* Your staff think before they spend
* You have systems in place to track your costs
* You keep your finger on the pulse of a wide range of costs out there in your marketplace.
Give it a go!
Margie
Tuesday, August 2, 2011
Tuesday, June 21, 2011
The magic of small business mentoring
Ive just joined Women's Network Australia, and spoke yesterday with the dynamic and insightful founder of the group, Lynette Palmen, AM.
Her passion is to connect business women to each other, giving them a forum for discussion and knowledge sharing, and I spent a wonderful half hour speaking with her about her journey.
I came away from our chat feeling inspired. I realised it's been a while since I've spoken with another business person who I know will be able to offer me valuable advice for my journey. Since writing The Small Business Success Guide, the shoe has invariably been on the other foot, with me mentoring small business owners on how to do things smarter.
So what is it about mentoring that helps light your fire? Well, the focus of mentoring is on you, and your professional growth. Unlike a coach, who assists you in a specific task or skill, and follows up to make sure it's happened, a mentor lets you set your own direction and make your own decisions, and supports you along the way.
Every small business owner should have a mentor: someone with more experience and success on the scoreboard who can guide you through your entrepreneurial adventure.
Finding a mentor for yourself, not just your staff, could make all the difference...
To your success!
Margie
Her passion is to connect business women to each other, giving them a forum for discussion and knowledge sharing, and I spent a wonderful half hour speaking with her about her journey.
I came away from our chat feeling inspired. I realised it's been a while since I've spoken with another business person who I know will be able to offer me valuable advice for my journey. Since writing The Small Business Success Guide, the shoe has invariably been on the other foot, with me mentoring small business owners on how to do things smarter.
So what is it about mentoring that helps light your fire? Well, the focus of mentoring is on you, and your professional growth. Unlike a coach, who assists you in a specific task or skill, and follows up to make sure it's happened, a mentor lets you set your own direction and make your own decisions, and supports you along the way.
Every small business owner should have a mentor: someone with more experience and success on the scoreboard who can guide you through your entrepreneurial adventure.
Finding a mentor for yourself, not just your staff, could make all the difference...
To your success!
Margie
Wednesday, June 8, 2011
Management in small business
I've been reading a lot of Bob Proctor's insights lately.
His take on management is particularly relevant to small business:
"Management is the direction of people, not the direction of things."
A basic human quality is to want to feel like you're part of something bigger than yourself, as I wrote in The Small Business Success Guide.
What sort of manager are you?
Staff want to be connected. So why not create this kind of culture in your business, no matter how big or small it is. If yours is a microbusiness without staff, try to get contractors to feel like they're an important part of your business. They will if you let them.
Your challenge is to work out a way to make team spirit happen in your business: you're all on the bus together, so you may as well enjoy the journey.
All success!
Margie
His take on management is particularly relevant to small business:
"Management is the direction of people, not the direction of things."
A basic human quality is to want to feel like you're part of something bigger than yourself, as I wrote in The Small Business Success Guide.
What sort of manager are you?
Staff want to be connected. So why not create this kind of culture in your business, no matter how big or small it is. If yours is a microbusiness without staff, try to get contractors to feel like they're an important part of your business. They will if you let them.
Your challenge is to work out a way to make team spirit happen in your business: you're all on the bus together, so you may as well enjoy the journey.
All success!
Margie
Tuesday, May 24, 2011
Small Business Tax Time Mantras
There's probably only one thing that small business owners hate more than losing money: doing their tax.
So here are a few mantras to get you in the right frame of mind this tax time:
1. I must, I must, do something about my records. The Tax Office expects you to make a reasonable attempt to be accurate in your book-keeping. Set up a system to record all income and expenditure in your business.
2. Honesty is the best policy. There's no point trying to fudge the books. The Tax Office's surveillance systems are wired to bank accounts these days. If you do find some mistakes in your books at the end of the tax year, get on the phone to the ATO and tell them about the discrepancies, before they come out to you.
3. Normal is as normal does. If your business is outside the norms of what others in your industry are noting as income or expenditure, you may be targeted for a tax review. Stay within the norms.
Happy tax time!
Margie
So here are a few mantras to get you in the right frame of mind this tax time:
1. I must, I must, do something about my records. The Tax Office expects you to make a reasonable attempt to be accurate in your book-keeping. Set up a system to record all income and expenditure in your business.
2. Honesty is the best policy. There's no point trying to fudge the books. The Tax Office's surveillance systems are wired to bank accounts these days. If you do find some mistakes in your books at the end of the tax year, get on the phone to the ATO and tell them about the discrepancies, before they come out to you.
3. Normal is as normal does. If your business is outside the norms of what others in your industry are noting as income or expenditure, you may be targeted for a tax review. Stay within the norms.
Happy tax time!
Margie
Tuesday, May 3, 2011
How far should small business go?
This week's news about Osama Bin Laden has sent many a small business scurrying to cash in on the killing.
What immediately came to mind was: are they entrepreneurial or exploitive? I'm a big believer in small business siezing the moment, but I came across a Rueters article, which lists the small businesses that are making a motsa out of the American fervour we've seen in recent days.
You name it, they're doing it: from Uncle Sam T-shirts printed with the words "We Got You Osama Bin Laden" to an Osama Bin Laden "Shot in the Dark" coffee special.
The question is: how far should small business go? How much misery should they wade around in just to make a fast buck?
You decide.
Margie
What immediately came to mind was: are they entrepreneurial or exploitive? I'm a big believer in small business siezing the moment, but I came across a Rueters article, which lists the small businesses that are making a motsa out of the American fervour we've seen in recent days.
You name it, they're doing it: from Uncle Sam T-shirts printed with the words "We Got You Osama Bin Laden" to an Osama Bin Laden "Shot in the Dark" coffee special.
The question is: how far should small business go? How much misery should they wade around in just to make a fast buck?
You decide.
Margie
Sunday, April 17, 2011
Small business Customer Service 101
The pervading wisdom when it comes to customer service and small businesses is that the customer is always right. A customer is king.
Which is all well and good until you get a customer that's a right pain in the proverbial. They whinge at every service, they return product when there's nothing really wrong, they phone to let you know they're peeved.
And when you call to chase payment for a product or service, they're the ones who come up with every excuse under the sun as to why they can't or won't pay their bill.
A respected business owner colleague of mine calls this group the Five Percenters. "About 95% of your customers are good, and will pay up eventually. And then there are the other 5%!"
Dealing with them is an eternal struggle, but he's come up with a new tack which I wanted to share:
"I call them and say that we're really sorry, but they have slipped into the Five Percenter group. We've tried really hard to get them out of this group, because we don't believe they should be there. But they're stuck! I suggest that if they have any ideas that could help us get them out of the Five Percenters, we'd really appreciate it!"
It's amazing, he says, how many people don't want to be stuck in a minority group. They often come up with ways to make themselves better customers.
And if they don't, ask yourself if really want them as customers. Might be time to set them free!
All success.
Margie
Which is all well and good until you get a customer that's a right pain in the proverbial. They whinge at every service, they return product when there's nothing really wrong, they phone to let you know they're peeved.
And when you call to chase payment for a product or service, they're the ones who come up with every excuse under the sun as to why they can't or won't pay their bill.
A respected business owner colleague of mine calls this group the Five Percenters. "About 95% of your customers are good, and will pay up eventually. And then there are the other 5%!"
Dealing with them is an eternal struggle, but he's come up with a new tack which I wanted to share:
"I call them and say that we're really sorry, but they have slipped into the Five Percenter group. We've tried really hard to get them out of this group, because we don't believe they should be there. But they're stuck! I suggest that if they have any ideas that could help us get them out of the Five Percenters, we'd really appreciate it!"
It's amazing, he says, how many people don't want to be stuck in a minority group. They often come up with ways to make themselves better customers.
And if they don't, ask yourself if really want them as customers. Might be time to set them free!
All success.
Margie
Wednesday, March 2, 2011
Small business advertising the 3rd grade way
Out of the mouthes of babes... My eight year old's 3rd grade social science book is a source of inspiration this week. To the statement: Advertising can be done in the following ways... she (and I expect most of her peers) noted four:
a) Signs
b) Television
c) Internet
d) Radio
What, no newspapers or magazines? The medium just isn't on the radar for the next generation of purchaser, if 25 nine and 10 year olds are any reliable sample!
It's no wonder that, according to to an articule by Eric Beecher on Crikey, "Google now generates more ad revenue than the entire Australian radio industry; a lot more than the three Fairfax flagship newspapers combined; more than any of Australia’s TV networks; almost as much as all magazines in Australia."
Google and the internet is the reality for so many people now. Still, regardless of who's getting the ads, the fact remains that only about half of all advertising efforts get results (phone enquiries, leads and ultimately sales). It's just that most small businesses don't know which half.
The answer? Know your 'ideal customer' and get inside their head. Once you understand who they are and why they buy, then you can focus on the message and the medium you'll use to target them.
If anyone needs a sample of 3rd graders, have I got a group for you!
All success.
Margie
a) Signs
b) Television
c) Internet
d) Radio
What, no newspapers or magazines? The medium just isn't on the radar for the next generation of purchaser, if 25 nine and 10 year olds are any reliable sample!
It's no wonder that, according to to an articule by Eric Beecher on Crikey, "Google now generates more ad revenue than the entire Australian radio industry; a lot more than the three Fairfax flagship newspapers combined; more than any of Australia’s TV networks; almost as much as all magazines in Australia."
Google and the internet is the reality for so many people now. Still, regardless of who's getting the ads, the fact remains that only about half of all advertising efforts get results (phone enquiries, leads and ultimately sales). It's just that most small businesses don't know which half.
The answer? Know your 'ideal customer' and get inside their head. Once you understand who they are and why they buy, then you can focus on the message and the medium you'll use to target them.
If anyone needs a sample of 3rd graders, have I got a group for you!
All success.
Margie
Monday, February 28, 2011
Small business the third grade way
Flicking through my eight year old's third grade books, there it was, in black and white. A small business mantra, Third Grade style.
I was intrigued, not for the fact that the small business owners I work with don't know this stuff. After all, it was aimed at Third Graders!
Rather, it was a good elementary run down of what needs to be successfully linked to "properly satisfy the needs and wants of the population".
I wondered how many of us really take the time to think through the links and what they mean for our businesses.
Here's what kids are taught in Third Grade:
1. When a person or company wants to produce goods or services, they first need to find out if there is a demand or market for the product or service.
2. The next thing they need to do is to find out the availability of the goods or services.
3. Then they need to get the equipment and labour force together.
4. Suppliers of materials need to be contacted and business arrangements made.
5. Once the goods or services are ready for sale, the company or person has to find places to sell and advertise their goods and services.
Funny how we get can caught out not by making the process of doing business more complicated than it probably should be.
It might just pay us small business owners to regularly refresh these five points in our minds. Then, we might just make it through to Fourth Grade!
All success,
Margie
I was intrigued, not for the fact that the small business owners I work with don't know this stuff. After all, it was aimed at Third Graders!
Rather, it was a good elementary run down of what needs to be successfully linked to "properly satisfy the needs and wants of the population".
I wondered how many of us really take the time to think through the links and what they mean for our businesses.
Here's what kids are taught in Third Grade:
1. When a person or company wants to produce goods or services, they first need to find out if there is a demand or market for the product or service.
2. The next thing they need to do is to find out the availability of the goods or services.
3. Then they need to get the equipment and labour force together.
4. Suppliers of materials need to be contacted and business arrangements made.
5. Once the goods or services are ready for sale, the company or person has to find places to sell and advertise their goods and services.
Funny how we get can caught out not by making the process of doing business more complicated than it probably should be.
It might just pay us small business owners to regularly refresh these five points in our minds. Then, we might just make it through to Fourth Grade!
All success,
Margie
Monday, January 31, 2011
Cash flow success
Even profitable businesses can go bust if you don’t have cash in the kitty to pay for things. Often it’s all about timing. But the timing issue is why cash flow rates right up there as one of the biggest stresses of small business.
So how can you guarantee your cash flow success?
I spoke with management expert Graham Godbee about this while writing The Small Business Success Guide. He thinks the best way to protect your business from crashing without cash is to do a cashflow forecast. Simply, you work out how much cash - petty cash and cash in the bank - your business has on hand.
There are some good cash flow forecast templates available online. I like a cash flow forecast template from the NT government in Australia for its simplicity.
Step 1
“You can include some cash equivalents like short term bank bills you own (not borrowings) and maybe some publicly listed shares that can be readily liquidated,” says Godbee. Write it all down.
Step 2
Then look at how much cash it takes to keep your business actually operating on a daily or weekly basis. The timing will depend on when major cash flows (both in and out) are expected in your business.
Godbee tells the story of a firm that pays its workers each fortnight. It should make its cashflow periods two weeks apart: “If it uses monthly periods, it may find it does not have the cash to pay wages one pay day in the middle of the month.”
Step 3
Then “ask yourself some basic questions about your future: what if you increase your sales; what if customers delay payments; what if you expand and buy some new equipment; what if costs rise; what if sales or prices fall; and so on? If you are in dire straits, it’s imperative that you work out where you’re at in terms of your cashflow.”
Step 4
As well as looking at how much cash is in your bank account, Godbee says it’s wise to look at things like the investments and assets that you can easily liquidate if you had to, and how much is left in unused lines of credit. “Are additional borrowings possible and sensible (possibly not on both counts if the company is in severe distress)?” he asks.
Put together an accurate cashflow forecast and it’ll take a lot of the stress out of your operation. “If you want to stay in business, if you want to impress your bank manager and if you want to keep your personal assets, then do your cash flow forecast!” suggests Godbee.
So how can you guarantee your cash flow success?
I spoke with management expert Graham Godbee about this while writing The Small Business Success Guide. He thinks the best way to protect your business from crashing without cash is to do a cashflow forecast. Simply, you work out how much cash - petty cash and cash in the bank - your business has on hand.
There are some good cash flow forecast templates available online. I like a cash flow forecast template from the NT government in Australia for its simplicity.
Step 1
“You can include some cash equivalents like short term bank bills you own (not borrowings) and maybe some publicly listed shares that can be readily liquidated,” says Godbee. Write it all down.
Step 2
Then look at how much cash it takes to keep your business actually operating on a daily or weekly basis. The timing will depend on when major cash flows (both in and out) are expected in your business.
Godbee tells the story of a firm that pays its workers each fortnight. It should make its cashflow periods two weeks apart: “If it uses monthly periods, it may find it does not have the cash to pay wages one pay day in the middle of the month.”
Step 3
Then “ask yourself some basic questions about your future: what if you increase your sales; what if customers delay payments; what if you expand and buy some new equipment; what if costs rise; what if sales or prices fall; and so on? If you are in dire straits, it’s imperative that you work out where you’re at in terms of your cashflow.”
Step 4
As well as looking at how much cash is in your bank account, Godbee says it’s wise to look at things like the investments and assets that you can easily liquidate if you had to, and how much is left in unused lines of credit. “Are additional borrowings possible and sensible (possibly not on both counts if the company is in severe distress)?” he asks.
Put together an accurate cashflow forecast and it’ll take a lot of the stress out of your operation. “If you want to stay in business, if you want to impress your bank manager and if you want to keep your personal assets, then do your cash flow forecast!” suggests Godbee.
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