Wednesday, December 29, 2010

Happy Holidays - Yes a Little Late

Happy Holidays even if it is a little late.  Just like my birthday (happens very close to Christmas) I got caught up in the swinging of things and let a few others go. But never fear I am back and here is another fascinating edition of small business news for Southeast Missouri.

I got a bit of good news today - a client of mine was able to obtain a small business loan. This client is one of six clients whom I feel are very fundable but the banks in the area are just not making loans to them. We did all the work, prepared the client for the bank's requirements and they still wait. Maybe this one client will be a signal that they are going to loosen up in 2011. 

I hope you will let me know what you want to read about in this column as I improve my skills in blogging. Please remember this is my first blog attempt and I am sure there are many others much better than me.

Well here is my weekly tip for you taken from INC Magazine October 2008 issue. Norm Brodsky is a very wise person having been an entrepreneur many times over and now serves as an advisor to INC magazine. In his monthly article, he writes the following tips on how to best run your small business:

Tip #1 - Know how to read the financial statements and then use them to help you make decisions on running the business.

Tip #2 - The sale is not a sale until you collect on the sale.

Tip #3 - Don't let your short term liabilities grow bigger than your short term assets. If you do, you are headed towards bankruptcy. I talked to a client about this very topic today.  They did not realize they had done this but once we did the financial analysis, there it was just like the wart on Cinderella's wicked step-mother.

Tip #4 - Always look for the long term implications of your decisions. You should always ask yourself - what will this decision do to my company 5 years down the road? Remember, building a great company takes time and there are no shortcuts to greatness.

Tip #5 - Always make sure you have cash in the business before you go spending it.

Tip #6 - You have only associates in business no friends. A lesson that is hard to learn but  once learned it can save you a lot of money and pain. This is true for your suppliers and employees.

Tip #7 - Focus on the gross margin not sales as it tells you the real story of your business's performance. It can be found on the income statement.

Tip #8 - Know your competition - the direct and indirect competitors. Don't let them sneak up behind you and catch you by surprise.

Tip #9 - Make sure you, as the owner, pay attention to the culture example you are setting for your employees and your customers.

Tip #10 - Always remember you have a life outside of work. Give work its due but your personal life is also deserving of attention.

Well happy holidays and look for more in the near future.

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