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|// by Hal Shelton / Apr. 1, 2015 0 comments|
In this post, you will learn what events trigger a need to update your business plan, how updating a business plan differs from creating the original, and who should be involved in the updating process.
Do I Need to Update My Entire Plan?
Rarely is a complete update required, but frequently the marketing section strategies and tactics need review and updating to meet constantly changing market realities.
For example, which of your actions/activities worked well and should be continued, and which should not? If everything is working, then you are not experimenting enough — not everything will work as planned and you can only grow from the lessons learned.
If updating your plan fills you with dread, don’t worry
Creating your first business plan may have been a chore, but updating a plan is easier and more fun. During your start-up, you likely had little direct experience and no track record or historical information, so many of the marketing and operational forecasts were educated guesses. Now you have some experience and a track record, and you have experimented and know what works and what doesn’t. Plus, you have already existing information to use as a foundation.
Situations That May Trigger a Plan Update
Business plans are living documents and need to be revisited every so often to ensure they are still relevant. In this way you can continue to use and benefit from the strategies and tactics.
Further, business plans are forward-looking, so they are based on estimates, which mean updates are often necessary. Following are some specific situations that may be cause for you to look at updating your plan.
1. Competitors have reacted to your market entry by reducing prices for similar products, extending business hours, liberalizing their return policy, providing free shipping, etc.
You must decide whether to match their tactics or stick to your plan. In either case, your revenues will be lower, so you will need to plan a course of action. These situations may affect your plan’s marketing, products & services and operations sections with a resultant impact on the financial section.
2. A competitor has copied your product or service.
Do you have intellectual property protection (patents, copyrights), and is it economically feasible to go after the perpetrators? If yes, there will be legal expenses, and revenues may decline with the increased competition.
3. The economy has changed (inflation, recession, unemployment rates), impacting potential customers’ ability to buy your product or service.
This will negatively impact your revenues, and depending on your staffing, adjustments may be needed there as well.
4. You land a major new customer, or an existing customer cancels a big contract.
The first is good news and might require more resources than originally planned, but the latter is not good at all and will require you to come up with a fresh approach.
5. A major vendor has cut you off or changed their terms and conditions.
For example, they previously allowed a 30-day grace period but now require cash in advance. If you are cut off, you must scramble to find a replacement. Maybe you stop buying from a vendor due to quality and dependability issues, or your business has outgrown a vendor’s limited services.
6. Regulatory changes impact your business.
One potential change in many states is the imposition of sales tax on all internet sales. A possible result is that online sellers and brick and mortar stores will have the same prices — and no competitive edge.
7. You lose a key staff member, which affects productivity.
Reduced resources mean either your business must reduce its size or you need to find alternatives.
8. You are ready to take your business to the next level.
Obtaining growth funds from a bank or angel investor requires a more sophisticated plan. Even if you do not need additional funding, a business plan based on an estimated $50,000 business might not be adequate to support a $300,000 one, which may need additional employees, for example.
Whether one of the previous reasons dictates an update or not, make it a practice to review your business plan at least once a year and plot your activities for the coming year. Do this as part of your annual planning and budgeting process at the end of your fiscal year. If you previously had your forecast in a full year increment, this time do it quarterly, and next year monthly.
Who Should Update Your Company’s Business Plan?
You probably prepared the original business plan yourself, since you were likely the only employee. If you have now grown and added staff, try to involve them so there is buy-in. That way, when it is time to implement the plan, your staff will be on-board and the activities will go smoother.
Don’t Have a Plan to Update?
It is never too late. Make an appointment with a SCORE business mentor—go to www.score.org to find a mentor near you. You may also want to visit www.secretsofbusinessplans.com for information about The Secrets to Writing a Successful Business Plan: A Pro Shares a Step-by-Step Guide to Creating a Plan That Gets Results.
|// by Whitney Lemon / Mar. 31, 2015 0 comments|
In 2011, the Get Your Business Online program, along with partners like SCORE, set out to help businesses get found online. After going to every state in the U.S. and working with thousands of business owners, we realized there’s a lot more work to do to help businesses take advantage of the vast opportunities yielded by the web.
So we’re introducing Let’s Put Our Cities on the Map, a new program to help businesses in 30,000 cities get the help they need to succeed, including updating their information where customers are searching for them most–on Google Search and Maps.
Being on the map matters. Research shows that businesses with complete online business listings are 2x as likely to be considered ‘reputable. Yet, only 37 percent of businesses have claimed their listing on a search engine.2 Let’s Put Our Cities on the Map helps businesses reach local customers by updating their info on Google Search and Maps at no charge.
So, what should your business do to make sure you’re being found by customers? Start with a diagnostic tool that examines your presence on Google Search and Maps. It’s available at www.gybo.com/business. Enter your business name and you’ll see a report that provides a snapshot of how—or if—your business appears across Google.
The tool highlights suggestions for areas that could use your attention, including:
From the report, you can access Google My Business, a central dashboard that allows business owners to manage information across Google.
Not showing up on the map at all? No worries. Follow the steps on the results page of the diagnostic tool to get started creating a Google My Business account to get your business listed on the map, at no charge.
Gybo.com also includes additional resources to help your business, like a website through StartLogic, a series of video tips for online success, and a Google+ Community for small businesses.
On behalf of the entire Get Your Business Online team, I wish you great success growing your business.
|// by Rieva Lesonsky / Mar. 30, 2015 0 comments|
I mentioned the National Small Business Association (NSBA)’s 2014 Year-End Economic Report in this space last week, but there’s a lot more to the report that’s of interest. Specifically, there’s good and bad news when it comes to small business financing.
First, the (relatively) good news: The number of small businesses that say they’re suffering from a credit crunch is down from 66 percent six months ago to 61 percent today. Now, the bad: One-third of small businesses still say they’re having trouble getting the financing they need.
Possibly as a result of difficulty obtaining traditional types of business financing, there was an increase in the number of small businesses using credit cards and business earnings to finance their companies (36 percent and 35 percent, respectively). Both types of financing are easy to access, which make them fast solutions both for startups and for existing companies that lack a strong financial track record.
Although using credit cards for business financing can be risky, there are some positive reasons small businesses may be turning to credit cards. Fewer small business owners than six months ago say the terms of their credit cards have worsened, and the average interest rate on credit cards dropped to 13.05 percent.
The percentage of businesses carrying debt has declined from six months ago, as has the average amount of debt (currently about $933K). But absence of debt isn’t necessarily a good thing for a small business; it could mean you can’t get the financing you need. In fact, that seems to be happening: The study notes “a concerning trend” in which more small business owners say the inability to get financing is keeping them from increasing sales or buying the inventory they need to meet demand. In fact, nearly 20 percent of five small companies can’t meet the increased demand for their products or services because they can’t get financing.
Yes, the economy is improving, and customers are finally showing signs of spending—but if you can’t get the money you need to provide what they want, does it matter? Fortunately, there are ways to get the money you need. Loans from credit unions, vendor credit, invoice-based financing and tapping into alternative lending sources are all possibilities to consider.
To make sure you’re making smart moves when it comes to financing so that you don’t get in over your head, be sure to talk to your accountant about your goals and needs. Also consult with your SCORE mentor—they can help with everything from learning about your options to preparing your paperwork and approaching a lender. Visit www.score.org for more.
|// by Aliana Marino / Mar. 27, 2015 0 comments|
This month’s SCORE Infographic shows the impact of human resources on small business development for 2015.
Of the biggest challenges for small businesses, hiring new employees ranks second:
Social Media Helps Small Businesses Find Today's Talent:
...And Small Business Employees Are Generally Happier Employees:
Download this month’s SCORE infographic for more details on these statistics. If you need help developing your marketing strategy, contact a SCORE mentor. You can also get tips from our free online workshops.
|// by Michelle Van Slyke / Mar. 26, 2015 0 comments|
Working full time doesn’t have to mean giving up on your entrepreneurial dreams. In fact, starting a business while working full time is a great way to test the waters of entrepreneurship and gradually grow your startup into a full-time business.
You may need to keep your day job while you prepare your new business venture for success, but with the right preparation your business ownership dreams can come true.
Growing up, my parents owned a franchise, so I got to see both the rewards and the difficult challenges of business ownership firsthand. Ultimately, working alongside my parents helped me see how planning and connecting with other business owners are essential success factors in running a small business.
Recently, The UPS Store did a survey of small business owners and people dreaming of becoming business owners. The survey revealed 55 percent of current small business owners felt prepared when they were first starting their business. And more than 50 percent of current small business owners say they were actually better prepared to start their business than they thought they were. This shows there is a large window for improvement in the small business preparation area!
Preparation and planning are vital to starting your new business off on the right foot. This is especially important if you plan to work a full-time job while you get your business started. Many people work full-time in order to keep a steady paycheck coming until their new business venture is up and running. And working may help you network, build a potential client base, further develop business skills or even learn more about the business you want to open while you work in that same industry.
To help up-and-coming business owners, The UPS Store partnered with SCORE to offer a webinar and guide on “16 Steps to Starting a Business While Working Full-Time.” This guide can help you think through your preparation needs, your business plans, your goals and how to manage your brand.
Our survey shows that the top three areas small business owners would have liked to have been better prepared in are branding/marketing, management of finances and time management. These are all areas where expertise can be gained from SCORE, from your mentor, and from other free resources.
Beyond preparation, it’s also important to understand how critical experience is – yours and learning from others’ experiences. Learning from experience is the reason you need mentors. Mentors have different viewpoints and experiences that can help push you in the right direction. They, too, may have been challenged with working full-time while they started their businesses and understand how to work through the fears small business owners face. They can share their mistakes and may save you from the same errors. According to our survey, 82 percent of respondents who had a mentor while starting their business found mentorship very influential in helping them through the process. Furthermore, approximately one-third of those who did not have a mentor while they started their business wish they would have had one.
SCORE can help you find a mentor. If you are just dipping your toe in the water and not ready to find a mentor yet, join an online community. Connecting with others is the easiest way to learn more and hone your skills.
Small business owners often find it difficult to improve efficiency and productivity because you’re busy with the day-to-day tasks of running your business. You wear a lot of hats – oftentimes, you’re not just the restaurant owner, but you’re the cook, the server, the bookkeeper and even the cleaning crew. Mentors can help you think through options for partnering with outside resources to help make your day-to-day life easier.
Under mentors, you have the ability to learn from their life experiences, both in and out of the workplace. I have my mentors to thank for teaching me how to work smarter and accomplish more.
|// by Cindy Bates / Mar. 25, 2015 0 comments|
Do you still hit the road five days a week, retreat into a maze of cubicles and then watch the time tick by as you make your way home during the height of the evening rush hour? If so, you’re part of a shrinking majority. In recent years, there has been a steady rise in the number of people who commute only a few steps to their home offices instead of hitting the highways.
Although the term “telework” was coined by Jack Niles in 1972, the idea really began to take hold in 1996 when the National Telecommuting Initiative was implemented. Since 2005, tele-commuting has grown by nearly 80 percent, according to Global Workplace Analytics.
With the increasing popularity of working from home, many SMB owners and HR executives find that strong telework policies empower employees to be more productive. If you already have an effective policy in place, below are three trends to consider incorporating today to help your business thrive with employees in multiple locations, including home.
Smaller or nonexistent offices. Without the need to house every employee during every business hour, businesses are moving away from traditional office spaces. SMB owners can save thousands by renting smaller spaces, utilizing co-op offices or running their entire operation from home. Office décor is evolving as well as more people adopt to the world of telework. If you have a small space, consider incorporating farm-style tables that can accommodate a number of people instead of traditional desks. These tables are inexpensive and can serve multiple purposes – from work space, to meeting space, to lunch area.
Weekly meet-ups. In my fast-paced, high-tech business, remote work is very much supported. Still, I recognize the value in connecting with colleagues face to face. Weekly team meetings, whether at your office or a local coffee shop, can help employees form better connections and inspire better productivity. Think outside of the box during these meetings and use the time together to foster creativity through brainstorms and fun activities. Incorporate short teambuilding exercises and take photos that each team member can take back to their respective locations.
Bring Your Own Device (BYOD). Gartner calls BYOD the “most radical change in the economics and the culture of client computing in decades” and expects that, by 2017, half of all companies will have mandatory BYOD policies. The BYOD revolution will not only save your business money, it will save time on training and implementation. By encouraging employees to bring their own devices, you can take into account how employees want to work since they’ve most likely spent the time and effort to find technology that’s perfectly suited to their style. Your business provides access to the productivity software and employees can access the infrastructure as needed.
Incorporating these trends into your telework policy can allow you to do more, increase employee morale and attract new talent. For more information on how to make the most of a mobile workforce, click here.
|// by Rieva Lesonsky / Mar. 24, 2015 0 comments|
There’s lots of good news for small business owners these days. In a January survey by the National Small Business Association (NSBA), entrepreneurs reported more confidence than they have in years. But one thing could be hampering their confidence: Concerns about cybersecurity.
More than 90 percent of small business owners in the study cited cybersecurity as a concern. No wonder: half of them report they’ve already suffered a cyberattack, with 61 percent of those taking place in the last 12 months.
A service interruption was the number-one result of a cyberattack; the second most frequent result was the business’ website going down. In addition, 19 percent had their business credit cards or bank account hacked.
The cost to small business of cyberattacks is on the rise. The average cyberattack cost a small business $20,752 in 2014, a substantial increase from the average of $8,699 per attack in 2013.
What do you need to know to prevent a cyberattack?
First, know that small businesses are actually more likely than big ones to suffer an attack—and more likely to go out of business as a result. Taking data security seriously is the first step to success. Fortunately, once you accept the risk, it’s fairly easy to protect yourself. Follow these security basics:
When it comes to cybersecurity, an ounce of prevention is worth a pound of cure. If you’re not IT-savvy, it’s well worth hiring an IT consultant to get you set up properly.
Or consult SCORE mentors, who can show you what you need to do to protect your business and data. Visit www.score.org to get matched with a mentor today.
|// by Steve Strauss / Mar. 23, 2015 0 comments|
Q: I work harder than anyone I know and yet I still seem to be stuck in the same place in my business as I was five years ago. I don’t know what I am doing wrong.
A: We live in a culture where hard work is revered, and for a good reason too – it usually pays off. I love this quote from Vince Lombardi, “The dictionary is the only place that success comes before work.”
There is no doubt that, especially, if you are going to be an entrepreneur, you will need to work hard. It is also true that a new business in particular is sort of like an airplane lumbering down a runway, gaining speed. It takes a lot of ever-increasing energy and effort to get that plane to go fast enough so that it will take flight.
But then what?
Once that plane is in the air, the laws of aerodynamics help it stay aloft. It takes no extra “work” per se for the pilot to keep that plane flying, but what it does take is a lot of smarts, applied properly.
Sometimes, you need to work smarter, not harder. In fact, especially in this information economy, working smarter can often pay bigger dividends. Now, let’s be clear, work – hard work – is necessary. But working hard will only get you so far. At some point, you have to be like the pilot and work smart if you want to keep your small business plane flying.
Get the help you need: My pal Gene Marks is a contributor to Entrepreneur magazine. He recently wrote a piece that explains the concept of working smarter, not harder, vis-à-vis employees. Says Gene:
There was once a time when it was just me. I was providing computer services. I was working a lot of hours. But I wasn’t making any money at it. Today, I’m making money. Why? Because I’m supervising 10 people who are providing computer services for me. I’m making money off of them.
Want to quit your job and be a freelancer, a one-person shop? I have bad news for you, and you need to hear it now, before it’s too late. You won’t be able to make a lot of money if you’re running a one-person business.
Indeed. You will be far more able to grow your business if you let go of some control and hire the help you need.
Get a handle on technology: Whether we like it or not, these days, if you want to be successful in your own business, you need to be part entrepreneur and part cyber-geek. What I mean by that is that technology now plays a huge part in almost every business, and it would therefore behoove you to understand just how many ways it can help your business:
Get bigger and better customers: Customers with bigger budgets make your job so much easier; they buy more, and more often, and often with less hassle and effort.
Where do you find these bigger fish? Check out these resources:
Search engines: Make a list of companies with whom you might like to work and start searching. Find the right department within those organizations, and the exact right people to pitch, and send them a proposal.
Books: One book I like a lot in this regard is Bag the Elephant: How to Win & Keep BIG Customers.
Corporate supplier programs: Corporations want to hire your small business. They have contracts to give you. If you become certified and learn how to navigate the maze, significant corporate and government contracts can be yours.
So go ahead, it’s OK, safe, even wise. Take flight by working smarter.
Today’s tip: It is conventional wisdom to say that business people feel overtaxed. But maybe that’s not true. According to the latest Small Business Index by Office Depot, More than half (57%) of small business owners say the amount of federal income tax they will pay this year is fair and will enable continued business investment.
|// by Jennifer Riggins / Mar. 20, 2015 0 comments|
You started your small business because you wanted to be your own boss - not necessarily because you wanted to be a manager. But here you are, growing your team with some really promising new hires. In fact, things are going so smoothly, so quickly that you barely have time to stop and review your own goals, let alone worry about someone else’s. But if you don’t set up your plan for performance management now, you are going to lose those new teammates sooner or later.
While performance management is sometimes more of an art than a science, there is still a formula behind how you can handle performance appraisals and talent management. Today, SCORE offers you an outline on how to overcome the dread of performance management and make sure you take care of your start-up’s great resources: human resources.
How you pay says a lot about who you are
“A good compensation plan is not only fair, but also supports the culture of the organization,” wrote John Welch, ex-CEO General Electric, in his book Winning.
Paying a fair market value and paying it on time is the bare minimum for retaining employees. But you have to take it further to gain long-term commitment and to attract new talent. In Welch’s vast experience coaching organizations, he has found that only around ten percent of U.S. employees have had “an honest, straight-between-the-eyes-feedback session” in the last year.
While he admits that there is no perfect formula for performance management, Welch offers four ways to ensure these feedback sessions are at least productive and fair:
1. Performance management should be clear and simple. No long, drawn-out forms that have managers putting it off til the last minute.
As long as each performance evaluation contains these four pillars of integrity, you have some room to experiment with different styles like one-on-one coaching, peer reviews, and written feedback. But your performance appraisal system itself much be under constant scrutiny. Welch offers you questions to re-evaluate your system often:
1. Does the evaluation system really measure company values or just financial results?
Annual performance appraisals are about nine months too late
“After believing in annual reviews for most of my career, I don't really believe in them anymore. Not timely enough, demoralizing in general (everyone thinks they're above average), and just a hell of a lot of work for everyone,” wrote John Lilly, software investment partner, in his comment on Quora.
In reality, people think they are doing better than they are because they’ve never heard differently, or they think their work is completely unappreciated because they never receive praise. Plus, how could a conversation about an entire year ever be accurate, detailed or productive enough?
It’s insane to think of once a year as being often enough to give - and receive! - employee feedback. In the lean start-up world we live in, we are pivoting every three months or even every three weeks, our objectives are constantly changing, and our job roles are continually evolving. At maximum in this agile world, we need to do formal performance management and goal setting every three months. This guarantees objectives are clearer and more realistic and feedback is more likely to be contextual and understood.
Performance management isn’t just about what happened
“Developing employees’ skills is often overlooked in startup organizations for fear of the costs involved; however, creating a culture that fosters development doesn’t have to break the bank,” CRG emPerform online performance management software wrote on their blogpost, “The Biggest Talent Management Mistakes that Startups Must Avoid”.
If you want someone to grow with your company, you have to focus on how they will grow. Particularly in a start-up, where just about everyone has room to take on new responsibilities and opportunities to learn, you need to make sure you are helping people head in the right direction. In reality, a performance appraisal is going to go one of two ways - talking about their exit from the company (when things just aren’t working out) or talking about where they are headed. Talking about an employee’s future is the only way to make sure you’re a part of it.
Here are some ways you can foster your talent during performance management and beyond:
1. Senior employees can mentor junior employees.
Written feedback is more likely to be acted upon
“Written feedback also helps you to keep proper documentation, to think more carefully about delicate issues, and to report on observations, feelings and value in a well-balanced manner,” wrote leadership coach Jurgen Appelo in his book #Workout.
Appelo strongly suggests offering written feedback as there’s a paper trail and it’s more likely to be understood and acted upon - IF it is done right. He offers five tricks to make sure emailed performance management is taken in the right way:
1. Describe Your Context: What is your state of mind as you’re writing the feedback? What were your expectations and assumptions during the examined time period?
How do you improve performance management without breaking the bank?
Tell us below how you make sure you encourage employee engagement and retention through better performance management.
|// by Aliana Marino / Mar. 19, 2015 0 comments|
In the SCORE online workshop, “Hiring the Right Employee,” Tricia McLaurin, Senior Human Resources Representative at Paychex, Inc. explains the best practices of recruiting, interviewing, selecting and retaining your most valuable assets: your employees.
The Society of Human Resource Management suggests that “direct replacement costs can reach as high as 50% to 60% of an employee’s annual salary, with total costs associated with turnover ranging from 90% to 200% of annual salary.” This statistic emphasizes the importance of finding and retaining the right member of your team. McLaurin says, “The bottom line can be negatively affected by bad hires and employee turnover.”
Why do you need this position in your business?
Follow these three steps to clarify the importance of hiring a new employee:
Writing a job description will help you establish the position’s details. Use descriptive and objective language. Be clear of expectations and concrete deliverables. Determine the essential and secondary functions. Verify that your language is compliant with Americans with Disabilities Act and Fair Labor Standards Act. You also must remove all discriminatory language. A SCORE mentor can help you with appropriate wording.
Job descriptions can also list soft skill requirements, like the ability to work in a team, time management, strong communication skills, etc.
How do you find the right candidate?
Once you know the specifics of the position, it’s time to advertise. McLaurin explains that attracting your target audience can be challenging. This is the first time in history five generations are in the workforce: Silent traditionalists (ages 65 and older), Baby boomers (ages 45 to 64), Generation X (ages 30 to 44), Millennials (ages 16-29) and Digital Natives (ages 15 and younger.)
Each person uses different techniques in their job hunt, so your goal is to attract as many candidates as possible with different advertising outlets. Remember that the best employee might not look like the person you thought you would hire.
McLaurin recommends using a job application. This way you request the same basic information from all applicants. Candidates can also submit resumes to provide additional details such as employment gaps and previous job duties.
McLaurin recommends a two-step process of interviewing: the phone interview and, when needed, the face-to-face meeting. For phone interviews, prepare four or five objective questions and document the responses. Consistency of questions between applicants helps in making the final decision. You can often learn more about soft skills and personality through open-ended questions. For instance, you can ask “What was your biggest challenge?” or “How did you deal with an irate customer or client?” These questions can indicate problem-solving and leadership skills.
Making the Job Offer
Once you’ve found the best candidate, send a letter which confirms the details of employment, such as job description, hourly pay rate or salary, benefit and vacation information. Include an “at-will” employee clause which should also appear in the employee handbook.
On the employee’s first day, introduce him/her to the people, things, procedures and processes required for the job. He/she should complete new hire paperwork such as I-9’s and benefit enrollment forms. Review the job description and employee handbook. Discuss opportunities for continual education such training and seminars, and how you want to see your newest team member to evolve.