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What Every Business Owner can do Every Year in Striving to Survive and Thrive

Business Owner Advice by Merra Lee Moffitt

By Merra Lee Moffitt, CFP®, AWMA®, CMFC®

You set out to build a business as a business owner, not a 70-hour a week job.  You love your customers and work really hard for them. But, do you find you are working for employee wages, not business owner profits?  Here are the items you can review and improve upon every year in striving to grow your profits and your life. No kidding.  I know you’re busy, but if you want to pursue the life you have dreamed of as a business owner, set up a system to build on these key areas every year.  There is a good chance your main competitor is!

  • Cultivate Cash Flow.  Every year, find another way to get paid faster, and pay out slower.   Can you send out invoices a day early?  Can you send reminders after 20 days?  Can you get paid partially up front?  Seriously ask yourself the question every year to come up with new ideas and retry old ones.  Your bank account might grow.
  • You Can’t Manage What You Don’t Measure.  Set up new benchmarks.  Are you measuring quality? Satisfaction? Job profitability?  Are you looking at the commonality of less profitable jobs or product lines?  Are you measuring wasted time?  What about proposal to sales ratio?  Measure whether you are getting better or worse.  Your benchmarks may improve.
  • Raise the Roof on Prices.  This is perhaps the most difficult, we fear we’ll lose customers if we do.  But are we really charging for all the extra services the customer ordered?  Have we offered something new of value that can be added? Have we looked at our competition lately, and have they already raised their core prices?  It’s easy to say “I Can’t”; find at least one item where you can.
  • New Markets, New Markets.   What customers are underserved in your business? Would it be profitable to do business with them?  How would you reach them?  What have you done to attract them?  Businesses that are NOT growing and changing risk stagnating and dying.  Don’t risk it. The world is changing, even here in Berks County.
  • Keep ‘em Satisfied. What new feature or service will tickle your customers and make them happy to do business with you?  What will make them tell their friends about you?  How are you keeping in touch with prior customers who use you infrequently?
  • Give Yourself a Raise.  If you diligently set up improvement projects in the areas above, you can generate more cash to your bottom line each year. Pay yourself first.  Are your employees happy when they don’t get a raise? Of course they are not, and neither are you.  Put a little more away for you first.  Which leads me to the next item.
  • Save it for a Rainy Day.  Someday, you might want to slow down.  Go fishing, travel, visit your retired friends.   The ‘die-at-your-desk’ retirement plan probably wouldn’t be your first choice.  Increase your automatic contributions to your emergency funds, retirement plans and wealth accumulation accounts. Every year – don’t wait for your financial advisor to remind you.  Set up a regularly scheduled meeting that coincides with the start of your most profitable time-of-year.  Boost your monthly contributions, even if just a little.

(A shameless plug)  I assist busy Berks business owners every day with business challenges.  We find
the time to be creative so we can implement these ideas for a business owner like you. Call me to assist you.

Posted in Business Building, Business Financial Planning, Financial Planning, Uncategorized
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