… From Biz2Biz NWA, March 2010
By Maxie Carpenter, MVC Advisory / Bentonville
If I hear any more of our political leaders say again that this country was built on the backs of small business, I think I’m going to implode!
It’s such an insult to the intelligence of small business owners and operators everywhere to hear the same rhetoric over and over when they’re being treated exactly the opposite by the majority of lenders in the financial community.
As I heard a leading economist say on a major financial news network this past week, “I’d hate to be a small business owner sitting in front of a lender right now asking for money, especially when I really needed it!”
So what’s an entrepreneur to do? Well, it’s time to do the homework!
As I advise small business owners and entrepreneurs, I continue to find the five most fundamental areas deficient. It really doesn’t matter whether it’s an existing business looking for growth money, or a start-up.
A Business Plan – This new marketplace, especially with the influence of the financial community, is simply not going to support any business that doesn’t have a plan in place that defines the business model and charts the future through at least three years.
A Financial Plan – Understanding the importance of a profit and loss statement, a balance sheet, a cash flow statement, and a break-even analysis are vital. Measurable, specific financial goals are critical.
A Marketing Plan – This is becoming even more critical in the new marketplace. It’s not just about advertising and sales anymore; it’s about “branding” a business with such consistency across the business model, that when the need for that service arises, that business is the first one that comes to mind.
An Operational Plan – I’ve seen more businesses fail because the owner/operator didn’t have a basic understanding of how to manage the business on a daily basis, especially in the area of knowing what really moves the business forward consistently.
A Communication Protocol – This speaks to the heart of managing a business, and that’s managing employees and customers. Most business owners don’t think of communication in terms of having a plan in place. If there’s no consistency in the way we communicate with customers and employees, then there’s no consistency in the way we operate the business.
It’s difficult enough to be profitable in this economy, even with these platforms in place. Without them, it’s next to impossible!
Maxie Carpenter is a professional analyst and counselor, author, and President of MVC Advisory Resource, Inc. He is the author of “I Didn’t Ask You to Dance!” and “Managing Difficult People in the Workplace.” You can reach Maxie at maxie@mvcinc.org
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