Will you be able to weather the storm?

us funds

When writing a business plan, it’s important to consider ‘seasonality’. ‘Seasonality’ is a way of predicting consumer behaviour. How often do customers buy? When do they buy?  Is there some sort of predictable pattern?

Example of seasonality

A classic story that is an interesting example of seasonality is one that a beverage company applied. The beverage company noticed sales were strong in the summer but slumped in the winter. Their study of seasonality in 1924 allowed the beverage company to apply a marketing strategy to be applied so sales would increase during the winter months. The company tried for many years to increase winter sales but it wasn’t until 1931 that the image of St. Nick as a poor or homeless slob was glossed up as a jovial, beautiful red and white coat wearing generous gift giver, the Santa Claus of today. Coke had re-created the image of Santa Claus and it overcame their sluggish winter sales.

tomaddv santa claus

Why should you consider seasonality when writing a business plan?

Seasonality is important to consider when planning your business so you can plan for the lows with a strategy in place, figure out your bare minimum in sales that you need to break-even. It is very important that you do market research and talk to people in the industry to find out what the historical data is and essentially find out, how businesses weather the storm. For example, if you are in the automotive industry, when are cars more likely to need repairs? If you are an engineering consultant, is there a season when people are hard to find or on vacation? If you are an accountant, how do you get people to see you before the tax deadline? Sometimes, in your industry, you many notice more trade shows in a certain season, these are usually held to not coincide with your busy selling season.

Write a business plan including seasonality.

In your business plan in the sales forecast, please apply the knowledge you’ve gathered from market research to include seasonality. To take it one step further, show how you will combat the slow season and how much your marketing strategy will cost you.

 

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Asking for Permission – A Regulated Marketing Strategy

YOU HAVE PERMISSION

On July 1st, 2014, it will no longer be possible in Canada, to send mass email to potential or existing customers, without consent.
Canada’s Anti-Spam Law has three main components:

1. Who are you sending the message to?
(is it a potential or existing customer?)

2. What type of message are you sending?
Is it by email, SMS or similar platforms?
Is it promotional, informational or include any aspect of marketing?
Is it misleading or false in any way?

3. Are you including your name and business, the name of anyone else you may be sending the message on behalf of,  your current mailing address, phone number, email, or web address.
Are you including ways to unsubscribe within 10 days at no cost to the customer?

I believe that Seth Godin’s term “Permission-based Marketing” is the best case scenario or a standard of best practices and now Canada’s anti-spam laws are modelling the idea that you should ask permission before being marketed to.

I agree fully with asking permission and actually think companies that were mass marketing before are now in a position of power to see who actually wants to receive their email. This is insight.

As a business owner, I will not know how many people receive the mass email I sent them and delete it and the reason why the would delete it. Although, I would never market to my customers that way. I believe if you honestly make an effort to know your customers, you will know and capture them.

I believe this anti-spam law is a standard of practice that will help business owners get to know their customers a bit better and help remove the population that you haven’t spent time on getting to know better. Opportunity awaits!

http://fightspam.gc.ca/eic/site/030.nsf/vwapj/ThreeThings_toThinkAbout-eng.pdf/$FILE/ThreeThings_toThinkAbout-eng.pdf

 

 

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how to write a good executive summary ht

how to write a good executive summary http://ow.ly/y8YGW

Ways to improve your business? Be laser sharp and focused.

Source: shutterstock.com

Source: shutterstock.com

Often times, from the get go, I see red flags when entrepreneurs are about to start-up their new venture. It’s very difficult to stay focused on one business idea at a time perhaps because you are just not sure if your customers will pay the price you are asking. Perhaps you are not sure you are up to being an entrepreneur.  I see entrepreneurs get flustered and make the mistakes of:

Telling a potential customer that they can provide the service or product the customer is looking for, when it isn’t in their business model. When I ask the entrepreneur why they would do this – they answer that it was too good of an opportunity to miss. The say I needed to do the job to get the food on the table. The reality is that you have a limited amount of marketing dollars, so every time you change your offerings, the customers memory gets clouded. The immediate gain, is not staying focused according to your business plan. One could argue, you are taking success off of your table and perpetuating this cycle of providing everything to everyone.

For example, your business is a graphic design business and then you get a few referrals who ask you to do their promotional videos. From there some customers ask you to do their wedding videos and then, wedding photography and from there wedding invitations to wedding planning. I have seen this exact scenario happen with my clients.

If I could impart some serious  personal opinion here, stay focused on one business idea for the first little while. You can grow to provide the added services later, but every time you change focus, you become known as the person who does odd jobs here and there. Stay focused, launch new aspects of your business as you have marketing dollars to reach larger numbers of people. If you have a large budget, obviously, you can attract a larger number of possible customers by offering many products or services (as long as you’ve done your research.)

Source: prime3coach.com

Source: prime3coach.com

I can’t go over the 80/20 rule enough. Look it up and look for inefficiencies in your strategies so you can start maximizing your efforts. Stay focused and stay away from fear of failure, fear of the unknown and your negative narrative. Rely on your research, business plan and effort and watch your business succeed.

 

 

 

Are you an entrepreneur presenting for funding?

photo credit: bank68.org

photo credit: bank68.org

I’ve had the opportunity to help entrepreneurs write their business plans and present them to a panel of business leaders from the community who decide whether or not the entrepreneur can gain additional funding. The entrepreneur works hard on market research, presents a business plan and then presents the business venture to the panel.

I’ve recently been asked to become part of the panel that decides whether or not the entrepreneur should receive additional funding. I’ve had the benefit of knowing both sides of the process and I’ve learned a few things that help me decide whether or not the funding should be approved. There are a few things I look at when I see the business plan.

Some of the things I look at are:

The name of the business.

Source: Success.com

Source: Success.com

  • Does it give me an indication as to what the business provides?
  • Does it have a nice flow?

 

The Executive Summary

Source: Ideacrossing.org

Source: Ideacrossing.org

  • Has the business been described clearly?
  • Has the target market been defined?
  • Has the owner qualified his experience and reason for starting this venture?
  • Have the Cash Flow numbers been calculated in a way that sort of matches the approximate target market?

If all goes well on the Executive Summary, I skip past the Sales & Marketing plan, the Operational plan, and go right to the end of the document, The Financial plan. In the Financial plan, I focus on the Forecast for the Cash Flow for in Year 1. The Cash Flow is something I spend a lot of time on trying to understand, how the money will come in and out of the business. I spend the most time trying to predict if the revenue indicates that there was a direct link to marketing. How much money did the owner spend in January for marketing? How did she get sales in January that doubled from December if the marketing budget stayed the same? I ask questions that have a strong focus on how the sale will be acquired.

photo credit: bank68.org

photo credit: bank68.org

The Cash Flow

  • How will you achieve a steady revenue year round?
  • Do you know what seasonality is like in your industry? Do you know the busy seasons?
  • How much will you spend on marketing? In your slow season?
  • Have you covered the costs of running a business? Have you sold products or services that you haven ‘t ordered yet?

Then from these parts of the plan, I decide whether or not to read the plan with a fine toothed comb. It’s important to get someone to proofread your plan. The best part of the review process is meeting the entrepreneur and hearing their reasons for opening the business as well as seeing their faces.

The plan is a form of trust that is relayed to your investors but it also helps the entrepreneur gain focus and confidence .

When I meet the entrepreneur, I look at the following in the presentation:

Positivity in Presenting

Source: startups.co.uk

Source: startups.co.uk

 

  • How does the entrepreneur great the panel? (even when they are nervous!)
  • How does he talk about his business? Do their eyes light up?
  • How does she present herself?
  • How does he handle the tough questions? Are they positive in the response?

I hope these things I look for will give you some insight when you are presenting. Every investor or panel member is different, so keep that in mind, if you can’t convince me, remember, you’re an entrepreneur : you will find the “yes”.

 

 

 

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Where To Sell Your Product Online – A Review

Some estimates suggest online shopping is expected to grow 20% each year. More and more customers are purchasing online with estimates that 7.5% of all retail sales are made online. If you are a small business owner, how can you sell your product online, even when you are sleeping?

Image

Source: eyongmei.com

Whether you choose one over the other depends on which choice will suit your individual business the best. The price can vary depending on number of transactions depending on the website you choose.There are a many places where you can open up your online store. I will talk about 4 of them here: Shopify, Volusion, Etsy, and Ebay.

Shopify – http://www.shopify.com

Fees

  • Basic costs $29 a month and ranges to $179 a month for an unlimited package.
    2.9% -2.25% + .30 online to 2.7%-2.15% swipe to + $.30

Pros

  • Easy
  • Quick
  • It features to help focus marketing campaigns on your target market
  • Flexible options to help grow your business.
  • Receive your own blog on your website

Cons

  • There are many additions that cost extra

Volusion – http://www.volusion.com

Fees

  • 5 plans ranging from $15 – $195 a month.

Pros

  • Competitive monthly fees.
  • No transactions fees.
  • 120 free templates
  • Plan includes a mobile and Facebook store

Cons

  • Hidden bandwith fees. If your store receives a lot of traffic, you have to consider the bandwith fee.

Etsy – http://www.etsy.com

Fees

  • Each listing on Etsy costs $ .20, but is only charged when the item is sold. Once the item is sold, there is a transaction fee of 3.5% of the item price. Remember to add shipping

Pros

  • It’s user friendly
  • Reputation
  • Community of buyers who support small businesses

Cons

  • There are many shops on Etsy
  • They all look similar
  • Hard to brand on Etsy
  • Fees grow with your business.

Ebay – http://www.ebay.com

Fees

  • Fees can range from basic at $15.95 monthly based on a yearly contract up to Anchor at $179.95 per month * Paypal fees are in addition to these fees as well as shipping.

Pros

  • Once you’ve got a customer in the door (virtual), you ‘ve got a chance to repeat business through excellent service.

Cons

  • Fees

  • Infrastructure ( The website is set up to make the company money)

  •  Keeping on top of your inventory (Indication of number of sales can be repeated and get confusing for the owner)

It is really important for you to do your due diligence. I’ve included the website addresses. It is very important that you know the number of potential transaction in order to make the best decision of which online store works best for you and your customer.

 

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Five Ways Business Plans Can $ave You Money – An Ice Cream Business

Image

Source: Istockphoto

 

We all want to get around to doing our business plans – some of us want to do it, but it keeps getting pushed down to the bottom of the to – do list. Sales are a force to be reckoned with, complaints came in, and taxes were overdue too so the, now dreaded, business plan got lost in the shuffle.

When I talk to business owners, they often tell me their main concerns are, increasing sales and decreasing costs. Here are 5 ways a business plan can save you money:

1. It will help you stay prepared and focused. When you are are not focused, you can start floundering around with vendors, target demographic, or values. These changes can confuse customers. A business plan can change, however, when you are following a business plan, you are more likely to deviate from the original focus and adjust accordingly rather than completely abandon original plans. For example, if you wanted to open an ice cream shop, you could focus on providing 80% dairy ice cream and 20% dairy free ice cream. If you didn’t have a plan, you might be more likely to change the concept and percentage to 50% dairy and 50% diary free.

Imag

Source: rontalk.com

2. A business plan can help measure what is working and what isn’t. For example, in the sales and marketing portion of your plan, you can apply a marketing strategy. You can sales projections based on the time and money spent on your marketing strategy. If your strategy is working, you can feel confident and measure your growth. If your sales are lower than expected, then you can try using other strategies that are similar in budget or allocated time to help increase sales. For example, if your ice cream marketing strategy is to advertise by handing out free samples by the beach, you can measure, how much sales increased directly after that strategy and measure it in your plan.

Image

Source: motherearthnews.com

 

3. A plan can help you plan and see in your expected expenses, the potential cost of running your business. There will be lots of little items that you may forget to include or not realize are unnecessary. You can see in your sales forecast, the potential profit margin and look at ways to decrease money spent in order to make a sale. For example, you may have the cost of the ice cream, the employees, the lease but you may forget to include the bank fees for using a point of sale terminal. Your plan will help you realize the cost by calling attention to your actual expenses.

4. A plan can help you save money by planning how to handle customer complaints and being ready with a company policy. Not being prepared with an operations plan can delay customer relationship issues, create bad morale, and create bad press. When you have a plan in place as to how you will deal with customer complaints, you can decrease how much time and effort will spent on the issue. For example, if a customer ordered ice cream to be delivered in your monthly subscription and the ice cream arrived melted, than you can decide before hand, how you would like to deal with the customer complaint. Will you refund the customer or delight the customer with a surprise? Remember, it costs 4 times as much to acquire a new customer than to keep an existing one.

Image

Source: foodpics.com

5. You can plan for “seasonality” or the high seasons and low seasons for your business. For example, if you own an ice cream shop in a market with 4 seasons, you know that there will be a high season and low season. In order to be efficient, you may look at planning for the Christmas gift season by creating packaged gifts, or you may add warm drinks to offset your low season. Perhaps after you see the seasonality, you will decide to introduce a subscription that will have ice cream delivered monthly to your loyal customers.

 

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Increasing Success in Business

Chances are you have good competition out there. What would you do to get a 20% advantage over your competition? Planning Leads to Success. Business Plan Writing Tips.

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What Authentic Leadership Looks Like

LeadToday

Authentic Leadership is a hard thing to define. I’ve heard many definitions of it and given more than one myself. But here’s a “definition” I believe works every time:

Authentic Leadership is like love; it’s hard to define but you know it when you see it.

Which leads us to this post… What Authentic Leadership Looks Like.

If you are the observant type you’ll see most if not all authentic leaders consistently doing the following things. These are not “natural,” but authentic leaders are intentional about them and they invest the time to do them every chance they get. They get so good at them that others may believe they are natural but an authentic leader never takes these skills for granted.

Authentic leaders are touchy feely. This is personally my biggest hurdle and I use “political correctness” as my excuse for not doing more of this. Authentic leaders reach…

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