Posted on November 12, 2011
Well you got your idea and a patent at least you did a search and found you can patent your product. On to financing: Well the conventional wisdom of financing is to get a good business plan with all the great financials and profitability within a year then head to the bank. While I believe that you could be the one this will work for it has never worked for me. These days it seems hard enough to get a house loan let alone a startup business loan. If this option has worked for you in the past I would love to know about it. Please post a comment saying so.
Let me first say that a good business plan is a smart way to start once you have the idea and know you at least can patent it. A business plan will help you to figure out your startup cost, projected earnings and break even analysis. It is also important to have an executive summary and mission statement because if you don't have a plan mapped out then you don't know precisely where you are going or who your target market is.
A business plan will also help you obtain financing even if you don't use a bank. There are many resources on the web that can help you get started with a business plan. One program that I like if you can afford it is Microsoft's Business Plan Pro. You can buy one right now off their site for just under $80 for the standard edition. If you are planning to develop a website it is a good idea to map out how you want the site to look. I again turn to Microsoft for this Visio is the program that I used. This program is pretty expensive though so you may be able to start with Microsoft word. It probably won't be as pretty but it works well enough. Read more...
Posted on October 25, 2011
When you are in business the whole idea is to make a profit. Without a profit your business will go down the tube. This will even happen sometimes when there is a profit if cash flow is not seen to. While most people who run a business - especially a small business - are good at what they do, some of them are not good at managing money.
Good small business finance management is critical if you are to stay in business. Here are some mistakes that people often make in managing the finances of their business.
- They often buy things their business really cannot afford, using a credit card. They then have to pay a great deal of interest on top of the purchase price. Rather than paying out all this money, consider other options such as buying second-hand or even doing without until the business can really afford it. Even getting a small loan will give you a better interest rate.
- Most business owners have a transaction account for their business and this is good, but you also need to have another account with higher interest so that you can make more money from your profit. Leaving money on the table by keeping all the business money in an account that offers little interest is just plain wasteful.
- Many business finance mistakes are made because the owners do not track their expenses. They have no idea how much they are spending or whether all the invoices have been paid. When you don't know where all the money is, how can you know how much you have to spend? A monthly budget is a sensible idea and will help you to plan for the future.
- Trying to do everything when you are not good at doing it is another mistake many business owners make with their business finance. Outsourcing certain chores such as accounting may seem costly but it will free up your time to do what you do best - run the business. Besides which, when you try to do things for which you have no training, your mistakes are likely to cost you more than outsourcing fees would have. Read more...
Posted on October 17, 2011
If you own your own business and you wonder if you should be working more strategically, you probably should be. Let's take a look at the top ten ways that having a business strategy will help you operate your business.
1) You have a clear idea about the direction you want to take your business and you know what to do to get there.
Rather than getting caught up in hectic operational actions, you have clear priority activities that you can accomplish every day. You are positioned to make daily strategic progress, no matter how disjointed your day becomes. Your strategic plan provides criteria you can use in decision-making and calendaring your time.
2) You have a much higher probability of your business ending up where you plan.
With your strategic "blueprint" as guidance, you know what actions will take you there. Even when you get off track, a quick consultation with your strategic plan clears up any confusion. You are taking the right actions. It's easier to ascertain your priorities and keep focused on them.
3) You have a clear idea whether or not an activity is strategic.
If you are taking non-strategic action, you know it. You've got a "map" that lets you know when you're off your plan. You're probably feeling some discomfort about this awareness - that helps your reorient.
4) Your strategy is a "living document" and changes as you complete activities and alter your course.
You can change tactics and add and subtract action steps. As you execute your strategy, you get new ideas, and can easily incorporate them into your strategy. Using a strategy, you have both flexibility and clarity. Read more...