one million new
businesses are started every year in the United States. About 80 percent
of all new businesses will fail within five years.
As the manager of
a small business, you must wear several hats. Never stop investigating
new ideas to improve all areas of your business. The astute manager
will gather information to assist him or her in making the changes necessary
to stay profitable in a competitive business world.
some tips to improve your profits:
makes a business successful?
to your customers. You are not really selling products or services;
you are selling customer satisfaction. Satisfied customers return
to spend more money and are likely to refer new customers to
is estimated to cost ten times as much to acquire a new customer
as it does to retain a current customer through good customer
your company runs well now in your absence, it will run well
in the event of your disability or death. If you are currently
indispensable, start training people now. One of the most rewarding
forms of retirement is to own your own company and to be absent
as much as you like.
word ability spelled "A.B.I.L.ity" could stand for
Accountant, Banker, Insurance Agent, and Lawyer. These professionals
handle a variety of business problems every day. They make excellent
sounding boards for proposed transactions. Consulting with them
before you conclude any deals can save you many problems.
can be your own best business troubleshooter. Consider arranging
a trip to visit a half dozen businesses just like yours, but
outside your trade area. Discuss products or services, customer
relations, vendors, physical plant and equipment, and financial
statement information with these noncompeting colleagues. Arrange
a five- to ten-day trip. Take your financial statements, a copy
of your floor plan, your camera, and a long list of questions.
When you return, you will be able to inform your staff of all
you learned. This trip is especially beneficial if you are not
affiliated with a franchise business.
business should operate from a budget. Your last year's financial
reports serve as an excellent guide to setting this year's budget.
Since it is designed with the best information you have available
at the outset, the variances from the budget figures may give
you valuable information in preparing the next year's game plan.
you start a new business, be sure the community can support
such a business. Some areas are not large enough to warrant
certain specialty shops. A bicycle shop, for example, may take
a population base of 50,000 people to make it profitable. A
grocery store, on the other hand, can be profitable in a town
of only a few thousand.
it necessary or profitable to have accounts receivable? Credit
is necessary to attract some business, and it is profitable
if properly managed. For example, a construction company finds
it impractical to issue credit cards to all its employees and
inconvenient to use a check for every purchase. In exchange
for the courtesy of an open account, such a customer should
be willing to pay immediately upon receipt of a billing statement.
deals and special franchises which sound too good to be true
usually are. We will gladly assist you in reviewing any
new purchase or business proposal.
partnerships (marriages) seldom have the same courtship afforded
most marriages. In the absence of this courtship, you should
have your attorney draft a well-written partnership agreement.
It is also important for family partnerships.
incorporate your business without first checking the long-range
tax and nontax considerations. There are many small corporations
that would have been better off operating in some other legal
businesses receive penalties for late payroll tax deposits.
To avoid such problems, don't sign payroll checks unless the
first check in the stack is the payroll deposit to your bank.
This may have you paying deposits earlier than required, but
you will not be receiving penalties.
and their solutions are as varied as are different businesses. There
are some universal truths, however, in managing any business.
Whether you are
starting a business or operating a going concern, we can help you select
the proper organizational structure and help you secure adequate financing.
We will work with you and your banker, lawyer, insurance agent, and
other advisors to solve your business problems.
We will assist you
with loan applications, pricing, credit policies, cash flow needs, cost
controls, and other management issues. We will gladly assist you in
reviewing your operations to see what you might do to be more profitable.
Give us a call for
a no-charge initial conference. You should interview us, as you would
any professional, to determine if we will be a good long-term match
for you and your business. If we don't have the answer to your problems,
we will assist you in locating someone who does.