I probably don't need to tell you how important it is to have a sound business plan...and marketing plan...and communications plan.  And since you're all successful business owners...I'm sure you can check these all off your list, right? 

But, have you ever considered how important it is to have a sound financial plan? 

This might just be the most overlooked strategic growth plan for your business.

I spent some time interviewing Shannah L. Compton, Partner, with SLC Insurance Services.  I thought you could benefit from her advice.

Heidi:
What is the #1 mistake you see business owners make with their financial plan?

Shannah:
It’s really difficult to boil this question down to only one answer. However, if I had to point out just one common mistake, I would say that your question exposes the answer- that is that most business owners forget the importance of a financial plan and operate for years with a lack of one.

Most business owners have a CPA and an Attorney, but tend to put the financial planner on the backburner until a crisis emerges. Simply put, a financial plan is as important to a company’s success as a business or marketing plan.

Digging a bit deeper, most business owners who do have a financial plan often overlook some of the most critical components of the plan which are:

a) Insuring their most valuable asset- their ability to earn an income. We insure our cars, our homes, our boats, etc., but most business owners often overlook their most important asset- their paycheck. A Paycheck Protection Plan should be the first building block to a solid financial plan.

b) A business succession plan for what happens to the business if something happens to you is equally as important. You’ve worked hard to build your business. I am sure the last thing you would want to happen should you retire, become disabled, or have an early demise is that your business would not carry on. There are many different ways to create a customized, cost-effective, succession plan to ensure that your hard work will continue to flourish for generations.

These days, one of the biggest complaints I hear from Small Business Owners is..."I'm struggling with cash flow".  

And, with the economy making a recovery (albeit slowly)...cash is king.  Businesses that dig deep and implement strategic marketing purchases NOW, will be better positioned for long-term success than their competitors. 

It's a simple fact:  More spending on marketing when others cut back means YOUR MESSAGE stands out. 

So--IT'S IMPERATIVE YOU FIND THE CASH YOU NEED TO INVEST IN MARKETING.

One way you can do this is to take a closer look at your account receivables. 

What is your total A/R?  How many of your customers are s-l-o-w-p-a-y-i-n-g?  Have you had to write some of these collections off?  Do you have a system for following up on unpaid invoices?  Does follow-up eat up your precious time...time you could spend on income-generating activities?

Expert Business Debt Collector, Wayne Eddington, advises:

"Many businesses face A/R problems--either how to deal with customers who pay their bills late, or not at all.  While customers expect prompt and professional service, they don’t always meet the same standard when it comes to paying their bills."

At the end of each day, when you look back, do you really know what you've accomplished?

Or have you been so busy, you can't remember.  Be honest.

Even more--at the end of each quarter, can you look back and account for everything you did that moved you and your business forward?  Do you know if you're on track to meet your yearly goals, too?

Success is based on your productivity--not on the amount of time you work!

Here are a few tips for Improving Your Productivity:

1.  Do something.  Don't just think about doing something.

Have you ever heard the phrase, "analysis paralysis"?  So many of us get caught up in thinking and analyzing and researching and making lists...that we lose precious time which could be better spent DOING something.  Don't be afraid to jump right in.  Action leads to success.  Inaction leads to nothing--literally.

It's hard not to notice the billboards, TV & radio advertisements, signs on bus stops, Facebook posts and mailers, right?  We're bombarded with the Census 2010 campaign, and every time we turn around, we see and hear messages urging us to participate.

However, have you ever considered how much this census means to you as a business owner? 

Caron Beesley's article has some important advice:

Accurate census data directly impacts how much federal funding our communities receive (up to $400 billion is up for grabs annually) for hospitals, public works projects, schools, emergency services and more. The data collected also helps determine the number of seats each state has in the U.S. House of Representatives – your voice in Congress!

The new year brings many small businesses a little downtime in January (unless you're a CPA, of course).  This is a great time to dust off your business plan and review your goals for 2010. 


Here are five tips for getting the most out of this process:

(1) Write the plan yourself--at least the first draft.  After all, no one knows your business the way you do.  You may want to hire a professional to help you polish your plan once it's written, especially if you'll be seeking an investor and/or business loan this year.  However, write the first draft on your own.  There are several templates available for free on the Internet.  You can also send me an email and I'll send you one of the templates I use.

(2) Write the plan in third person.  "The ABC Company plans to..." not "We plan to...".  This may be a personal preference, but it definitely makes your plan sound more professional.