AC Interpreting

Posts Tagged ‘Business Owner’

You had to do it. You had more staff than work, and your cash flow was not going to be able to support everyone you had hired for much longer. You gear yourself up and let some of your closest friends and colleagues go. Then you realize your most difficult job still lies ahead – retaining your remaining staff and their morale!

After reading several blogs and articles about how to manage employees after a layoff, I thought about the many companies that have laid off or will need to lay off employees. There has been and will be a lot of material written on how to communicate with the remaining employees after the layoff. But far too little is written on the need to formulate a financial plan to survive the layoff and return to prosperity.

Does the CEO really see how the layoffs will solve the company’s cash flow and profitability issues? Can he/she confidently explain to the remaining staff why these cuts were just deep enough but not so deep that the company’s hallmark way of taking care of its customers will not be in jeopardy?

With a sound and reasonable financial model that accounts for the “before” and “after” effects of the layoff, a business owner, entrepreneur, or CEO will be able to communicate with honesty, transparency, and confidence. A leader should have the financial model/plan in hand when he/she meets with the remaining employees. The leader should be able to say something like this: “If we can realize at least $50,000 per month in sales for the next 12 months, we will not have to make any more changes in staffing.”

Such communication will begin to rebuild the trust of the remaining workforce who just saw their friends and colleagues escorted from the building. If the leader fails to communicate specifics and refers to the future performance of the company in vague terms, the employees will continue to lose their trust in the company. Productivity and morale will drop and the company’s chances for survival become much less realistic.

After discussing this topic with with many others who serve in CFO careers, they all confirm that the following two things happen. First, when a company has a sound financial plan for rebuilding the company after a layoff, the productivity and morale of the remaining staff actually increase. Second, this improves the firm’s chances for success and helps its comeback as a leaner, meaner, and more nimble firm that adds even more value to its current and future customers.

One of the most effective ways to to build your business is through the power of networking. As a business owner it makes sense create relationships with other business owners in your area and also in your area of expertise. The more you can help other people build their businesses the more they will want to help you.

Here are some top tips to build your business through networking

1.Your Suppliers

One of the most overlooked areas in networking is your suppliers. All too often we focus on getting the best price and service from our suppliers yet we overlook the fact they probably supply to our target market. Make a point at your next supplier meeting to explore how you could help each other find more customers. This can be a powerful method of building your business through networking and costs next to nothing in terms of time and money.

2.Local Business Breakfast Meetings

If you do a Google search for business breakfast meetings in your area you should find a good supply. These tend to start around 7am and allow you to network with fellow business owners before the start of the normal working day. Before committing to join one make sure you visit all the meetings in your area at least once. You will get a feel for which format and group of people suits your business best.

The key to making breakfast meetings work for you is building relationships and teaching your fellow members about your business. Once you achieve this you will have 20-40 ambassadors building your business using the power of networking form each meeting you attend.

3.Local Chamber of Commerce

Your local chamber of commerce should be a good source of information to help with your networking activities. The reason I put this as third behind suppliers and breakfast meetings is not all chambers are the same. Ask your fellow business owners and suppliers how they find the chamber works for their business. I have found some chambers are very proactive and should be joined as soon as possible, sadly I have also found others to more focussed on corporate members.

4.Local Business Links

As part of any strategy to build your business through networking, making good contacts with your local business links is vital. They are a great source of knowledge in terms of business grants and free training. They also are a great source of knowledge to find the best business networking events in your area.

Building your business through networking is something that must be worked on consistently. Like any marketing effort the results you achieve will be directly proportionate to the effort you put into it. Over time the rewards easily outstrip the effort as you build ambassadors for your business.

If you are operating a business, there is a point in your life that you will feel the need for additional capital and the only option is to get a loan and apply for business credit. It is hard for businesses to survive by relying only on their own cash. That is why as a business owner you have to know some of these strategies to build up your image as a trustful and good credit risk to banks and other financial lenders.

When you attempt to apply for business credit at some stage and you are eventually denied, this can become a part of your record so, in the future, it will become more difficult for you to get an approved loan. To add salt to the wound, you can even be put on the blacklist as an effect of your failed application and this is something you do not wish to happen.

So, here are some good pointers on how you can build up a good business credit rating:

1. Start applying for smaller credit lines with your local office providers or stationers like Office Max and Office Depot. You don’t have to get a loan higher than $50 at each store but it is a big step towards developing up your overall credit as long as you are responsible enough to pay bills on time. Consider this as your initial round for funding.

2. Use a business credit card for your second round of funding. Use the card and pay off your balance each month. This can establish your business with a better record of credit.

3. Lastly, the third round of funding that can significantly increase your Paydex score is to establish a credit from bank line. However, you should only do these if you have accomplished the first two rounds.

One better tip for you is to make sure that you fill out all loan application forms accurately. You should also submit all the needed documentation and requirements. Sometimes, small technical errors are the cause of rejection.

It has been said that nearly 61% of businesses are launched with either private capital or capital that is invested into their business by family and friends but investment doesn’t have to stop with merely just your family and friends, which is why equity finance exists.

Equity finance is cash that is invested into your business in return for a share of your business. These investments of cash never have to be repaid and don’t have interest attached to them. Equity finance is true risk capital as there is no guarantee that the investor will get their money back at all and these investments are not tied to assets that can be removed from your business should it fail.

The way in which investors get a profit from their investment is the fact they have a share in your business. This share means that investors either get money that is generated either through a sale of the shares once the company has grown or through dividends, a discretionary payout to shareholders if the business does well.

There are several types of equity finance such as business angels and venture capitalists. Each type of equity finance varies in the amount of money that is available for investment and the process of completing the deal.

If your business can support a growth rate of a least 20% you are more likely to be able to get equity finance. If you can’t generate a growth rate of at least 20% in your business then you are unlikely to be able to gain equity finance. It is the idea of control and the prospect of higher returns if your business is successful that attracts people to invest in your business

Sadly however many people are still highly reluctant to seek the help of equity finance as they see the idea of it as ‘relinquishing control’ of their business. Many small businesses are especially reluctant if their business is growing fast. As a business owner you should ask yourself the following questions below making any decisions about choosing to use equity finance:

o Are you prepared to give up a share of your business as well as some of its control?

o Are you and your management team confident in the business and the products and services that are on offer?

o Does your business have a unique selling point?

o Do you have drive to grow your business?

o What industry experience and knowledge does your management team have?

You should also consider the following when it comes to obtaining equity finance:

o How much funding do you need?

o How much control are you hoping to retain?

o How long do you need your funds for?

Each business should investigate the options that are open to them when it comes to finance. Equity finance is medium to long term finance and is the perfect type of finance that is open to small businesses, especially if you are an entrepreneurial business. Entrepreneurial businesses are what private equity investors are mainly interested in. This is because they have aspirations and a high potential for growth.

If you are interested in the use of equity finance it is important that you speak to a financial team who can put you in touch with people who will be able to put you in touch with the right investors.

Because of the recent ineffectiveness that prevails with commercial banking, working capital financing can no longer be taken for granted by any business owner. Some common advice for many complicated problems is often a variation of “it is time to get back to the basics”, and working capital loans represent an ongoing illustration of this wisdom for small businesses. Working capital management is the science and art of short term business cash management, and improvements in this area should always be welcomed by commercial borrowers.

Ensuring adequate business cash flow has become a higher priority for most businesses because of declining sales occurring simultaneously with decreased bank financing availability. In one common occurrence, borrowers are likely to attempt to juggle the timing of expenses whenever possible in an effort to match receipt of business income. Business owners will realistically be forced to “get back to working capital financing basics” because this is not an ideal solution under any circumstances.

A primary alternative for any business to explore in their efforts to deal with a mismatch of income and costs is business expense reduction. Credit card processing is a significant cost to evaluate. This is frequently an expense area that is overlooked because the credit card processing provider was chosen for convenience or perhaps because they were recommended by a banking or other professional relationship. Analyzing alternative providers in conjunction with obtaining a business cash advance is one of the most practical methods for reducing this cost. By combining efforts to obtain additional working capital (via merchant financing) with a change of processing services, a dual cash flow benefit can be achieved by receiving commercial financing while simultaneously reducing a major cost. For anyone who might say that this is easier said than done, please understand that this whole process should be undertaken with the ongoing assistance of a business financing expert who routinely accomplishes these transactions.

Looking at whether it is feasible to reduce overall bank financing is another potential cost reduction. For almost every conceivable commercial finance service, many banks are increasing their fees. To avoid some of the bank fees altogether, businesses should increasingly try to reduce their business debt levels. When this is not practical, the possibility of firing the current bank and replacing them with a new bank (and more appropriate fees) will need to be emphasized.

In reviewing working capital basics, small business owners will quickly realize that the most effective commercial funding sources have changed during the past two years. The more active role that banks have traditionally played in providing both working capital loans as well other forms of commercial loans has been quietly stopped (or significantly reduced). Commercial borrowers might need to be alerted that there are both “new basics” and “old basics” for most working capital management situations, and this is the rationale for making the last observation. The entire process of reviewing “working capital basics” will help businesses realize how other business financing options are likely to be more effective in resolving their predicament than the traditional bank solution of taking on more business debt to resolve the described problems.

Incoming search terms for the article:

Business finance training refers to programs that teach individuals how to handle various financial duties. Finance training is similar to finance tips in that both help business owners make better monetary decisions, but training programs offer a more detailed explanation of finance strategies. Training programs vary in price and can be used by the owners and employees of a business.

The most basic business finance training provide information on budgeting, preparing financial statements, managing cash flow, strategizing, forecasting, improving performance, and applying basic procedures and concepts to more effectively manage a business. These programs are recommended for new business owners to help them understand standard business practices. Once these basic methods are mastered, more specific financial training may be looked into.

Advanced business finance training delves more deeply into a certain financial procedure or concept, usually at a higher cost than basic programs. Advanced programs may teach business owners how to set up effective business models, make decisions based on quantitative analysis, manage and control accounts, practice due diligence, measure productivity, and strategize concerning mergers and acquisitions.

Taking part in any kind of business finance training gives a business owner the resources to make more intelligent business decisions that result in increased productivity and profits. Many different types of courses are available either online or at a specified location. Some programs may even offer the option to train at the business. Taking into consideration the needs and abilities of a business is the key to finding the best business finance training.

A business finance solution generally refers to methods of funding and maintaining the finances of a business. Most solutions involve ways of obtaining working capital, but others also offer ways of protecting and increasing that capital.

To obtain working capital, business owners look to finance solutions that offer funding by several different means. The most common means are loans and financing. Asset-based loans use a business’s assets, such as inventory and equipment, as collateral. A business may also opt for a property loan in order to acquire commercial space. Invoice financing, such as factoring, involves liquidating or selling a business’s accounts receivables in exchange for quick funding. Some businesses look to trade financing to supply their inventory. The business will tell its financer the amount and cost of goods needed, and the financer will pay for the goods. The business then repays the amount financed over a specified period of time.

Most companies that provide business finance solutions also offer ways to protect and increase a business’s capital. Credit protection safeguards a business from daily risks, such as customers not paying on time, so that the business does not suffer incredible losses. This makes it much easier for the business to borrow money in the future, and it protects the balance sheet. A finance solution may also offer business insurance plans that increase the stability of a business. The most common types of business insurance are employee and public liability, car, property, and health insurance. These business finance solutions are designed to protect businesses against potential losses.