My Banker is a bum! (He won’t lend when I need it most!!)

A cent for every time I have heard those words and I really would be a millionaire and possibly even richer.  The thing is it is simply not true.  Now, please do not think I am a big bank lover. I am not; I hate bureaucracy just as much as the next person and unfortunately that is what many banks are. However, the reality of most Small and Medium Enterprise [SME] situations is that Banks are your business partner every bit as much as the taxman (I know) so take a chill pill and live with it. Learn to make the relationship work for you. “Get real” I hear you say, or words to that effect. Yes, you can!

A few years back I stepped into a medium cap company to hear from Chicken Lick’n (the CEO) that the sky was falling in.  Well I went to the Bank to see for myself. Ah ha, indeed the sky was about to fall in. To cut a long story short, we brought in some poles, bought some time, propped the place up for a while, and got things back on track.  In other words, we gave them a plan and executed on it.  Eventually the company worked its way out of its difficulties [all self inflicted] and is now part of a global engineering group, operating very successfully.

The reason that it got so scary for Chicken Lick’n was that the company had neglected to maintain its relationship with its Bankers.  This does require effort and while I agree it is a two way street, remember your [SME turnover $200k-$2.5m per annum] relationship manager probably has 100-150 SME customers to look after.  So guess who’s going to do the running? That’s right you and me.  So what do we do? Here are some simple rules that I apply in my every day business;

1.      Give yourself and the Bank the best information available about your business

2.      Have a clear but simple business plan that shows what you intend to do with the borrowed money [visit www.thesmallbusinessstrategy.com for some help] and how you will operate

3.      Prepare you business plan without ‘rose tinted glasses’. Under promise on your expectations and over deliver on results.

4.      Give the Bank a report at least once every 6 months and make a follow up call to confirm they have the information. The best times are without doubt  half way through the financial year and again after your year-end accounts are ready. This report must be simple.   Dot points highlighting progress against target are good.

5.      If things start taking a turn for the worse, do not ignore it. Front up and let the bank know the situation ahead of time and what you intend doing to resolve it. Keep them posted as you progress.  You might be amazed! Banks have a vested interest in your business succeeding – not failing!!

6.      Your relationship manager may change every five minutes.  I know how frustrating this is. Let it go and connect with the new person. Most of them can become little gems, look after them and your relationship will flourish.

7.      Don’t worry be happy!

Until next time,

Your, paddling like mad, business coach.

Neville@thesmallbusinesstoolbox.com

How to Get Your New Business Started

Thinking of starting your own business? We’d like to share this thought provoking article “10 Mistakes that Start-Up Entrepreneurs Make” By ROSALIND RESNICK

February Financial Year-End?

February is a fabulous month with signposts along the path reminding us to live better and love more. With summer now well and truly upon us we can all look to the sunshine and warm days to find optimism all around us. Isn’t it time to steal your share?

For many February also brings in a financial year end and this is a time for assessing achievements and planning targets and goals for the next fiscal.

As one financial year draws to a close the stepping stones need to be laid to lead your small business to the destination you want to be a year from now. Choose to adopt a positive mindset and chart your own course.

This is the key to developing a business strategy that will have you seizing opportunities with gusto and making 2010 your best year yet.

Yes, 2009 was a tough year for many and you may well feel scarred from the lack of activity in your industry or sector. However, with the blank canvas that is the year ahead it is important to review last year’s activities, failures and successes, acknowledge the lessons learnt and move forward towards a more successful new financial year.

Globally, economic shifts have left entrepreneurs spinning. Now more than ever the business strategy you commit to for your financial New Year must give cognizance to all the practical knowledge you have acquired, take traditional business guidelines into account and rock with chutzpah!

To develop a business strategy that will have you taking the profits off your competition and growing your own debtors book visit TheSmallBusinessToolbox.com now and find out about an easy, practical, step-by-step programme that will have you smiling all the way to month end.

Big 5 Business Tips

There was an interesting article in the Sunday Times this weekend about how Old Mutual base their financial education programme around the Big 5 animals and it struck me that their analogy is perfectly aligned also to what skills are required to grow a sustainable business.

In identifying particular traits of the Big 5 animals they say:

The lion eats first, before his pride. In other words you should pay yourself (in the form of investments) before starting to spend. This is certainly true in business, particularly in small businesses. If you don’t put away money every month for the rainy day, when it arrives, and without doubt it will, you won’t have the cash reserves to see you through. 10% of turnover every month needs to go into an interest bearing account so that you can sleep at night in good times and bad!

The leopard has realistic goals; while young he stalks catchable prey, graduating to bigger animals later. So set realistic and achievable goals. Don’t compare yourself to anyone else, try to keep up with the Joneses or waste precious turnover on non-essential expenditure. And, constantly go for stretch within all aspects of the business so that your goals stretch as the team’s skill base grows.

The elephant’s power is its perfect memory. Knowledge is power and networking is your trump card. You can’t grow your business if you stay behind the counter. Remember people, keep in touch and help them so that when you need help they’re willing to assist.

The rhino’s approach to a threat is to charge at it. Face up to your challenges, find out the facts and don’t play games with yourself. Sit down and develop a plan of attack and charge it with all your energy so that every day sees small, incremental improvements.

The buffalo is deliberate and steady, growing the herd over time. Be patient and harness the power of compounding, not only in financial compounding but the compounding effect of consistently driving improvement, customer service and flexibility within your business.

By focusing on these Big 5 analogies you have a simple process for building sustainability in your small business. Remember, it’s not about dramatic changes, but constantly striving for 1% improvement in key areas every day. By doing this your future is secure.

Business Dreamers – Where Are You?

Where have all the business visionaries gone? As we celebrate 40 years since Neil Armstrong landed on the moon much has changed.

Where that event left us with an expectation of great futures filled with possibility and achievement, the water that has gone under the bridge since has definitely discoloured and become polluted, figuratively and literally!

History tells us that the companies that positively get out there and market themselves now; focus on improving their service delivery levels and introduce some cost effective new product/service offerings are the ones that will not only survive, but thrive. They’ll steal market share from their competitors who are too busy crying over spilt milk to do anything constructive.

Your customers and your staff need you to become a true leader and show them the way. Most of them can’t see the way forward because they’re so caught up in their own personal problems right now. Besides, if they were capable of seeing the way forward they’d be sitting in your chair!

Have you got a clear strategy for your business for the next 12 months? If not, why not?

Look at signing up for The Small Business Strategy Toolbox if you need assistance in structuring your thinking and ensuring you cover all the critical success factors. Usually outside, professional yet practical advice is just what’s needed when you don’t know which road to take and you don’t have the time or money to try several options before you find what works for you.

If you don’t have the expertise and experience to find the opportunities that already exist get help earlier rather than later. To call for help when the creditors are already shouting is too late, develop your plan of action now and ensure you are still in business this time next year.