Many of us are going through some difficult times with our business.  The biggest challenge that I continue to hear about is the build-up of receivables and slow paying customers.  Some of us are being impacted on the revenue side as well but, luckily, that hasn't been a significant lament among our clients. 

One question that was recently raised during a discussion I was having with two local small business owners was, "'How much do I tell my employees"? 

This particular business owner wanted to share some of the challenges facing the business and the subsequent shift in some of his priorities.  Yet, at the same time, he didn't want to put undue stress on the employees and impart concern over the future state of the business.  For our businesses to remain successful, our employees must continue to do their jobs well, retain a positive attitude and continue to provide a high level of customer service - this can be hard to do in the face of uncertainty!  It is a fine line between being open and honest with your employees and burdening them with information that they really can do little with. 

How much transparency is good with our employees especially during times of economic uncertainty?  I think it depends on the type of ongoing relationship the business owner already has with his employees, the severity of the potential impact on the business and the maturity level of the employees.   But, in any case, some information needs to be shared with an eye toward helping the employees during the uncertain times and keeping them focused.  Transparency - your thoughts?

Have you ever heard of the Kit-Cat® Club?  Our friend and owner of ComedySportz Improv Theater, Christine Walters, recently spoke about her Kit-Cat Clock. 

Kit-Cat Clocks have been around since the 1930s when they became popular during the Depression because they entertained folks during difficult times.  Many people have wonderful memories of those clocks in their homes while growing up and those same people continue with the tradition today.  The Kit-Cat Clock remains popular with many new, flashy colors and its own website:  http://www.kit-cat.com/kitcathistory.htm

Along with the entertainment factor, the Kit-Cat Clock has become of symbol of optimism espousing the following creed:

While we might not be able to make everyone around us smile, we can certainly go the extra mile to remain positive in light of the challenging times surrounding us.  A great lesson to learn from a sill cat clock! 

Another great way to stay positive to visit the ComedySportz Improv Theater for some family-friendly improv fun!  http://www.comedysportzrichmond.com/

Concerned about the economy?  Please visit this fun video from our friends at Madison & Main...

http://www.youtube.com/watch?v=_hDlaGd5_78

Our good friend Sandra Kozusko of CFO Professional Services, PC spoke at the Chesterfield County Chamber luncheon last week.  She spoke about a topic near and dear to the small business owner's heart, keeping a competitive edge in a sluggish economy,  Not that I am saying we have a sluggish economy or anything!

We at The Growth Coach heartily concur with Sandra's perspective, that it is important to know your numbers in order to remain competitive.  She equipped the audience with "4 Knows" that each business owner should know about his or her business.  Here goes:

1. Know where you are making the most money then perfect it.
2. Know what marketing avenues have given you the greatest ROI and keep doing it! (Don't cut marketing expense to zero!!)
3. Know where you can cut expenses and cut now.
4. Know where you stand on your year-end taxes today.  Don't wait and be surprised with a big tax bill or miss opportunities for deductions.

This is great advice.  I would all one more "know" that is:

1. Know your receivables and manage them aggressively.

I find that my most successful clients know their numbers and manage to their numbers.  Determine the key metrics for your business and keep a close eye on them - especially during sluggish economy.  Your Thoughts?

Please visit CFO Professionals at http://www.cfoserv.net/   They provide accounting solutions for small businesses.

WOW!  My head is just spinning with the all of the news about the challenges facing our financial markets this past week.  I have found it to be very difficult to shift through the TV broadcasts, newspaper articles and internet sites to decipher what has happened and how we should move forward. 

We conducted one of our Growth Coach coaching orientation seminars yesterday.  We had a great group of about 18 business owners attend and we discussed the challenges and opportunities they are facing in their businesses.  While many of them may be beginning to feel the pinch in this economy, our discussion converged around specific challenges, like attracting and retaining qualified employees, and generating ideas for moving forward.  It was a true reflection of how, I believe, local business owners are remaining positive and action-oriented during difficult times.  Yeah Richmond!

One of the items I keep hearing about on the national news is how the credit markets are at a virtual stand-still across the country yet the folks that I speak with here in the Richmond area remark on the availability of capital for good projects and qualified applicants.  What are you experiencing in the credit markets here in the Richmond area?  If you are a banker, do you have money to lend?  What types of deals are you looking for?  If you are a business owner, have you been able to obtain credit?  What is happening with your LOC?  We are blessed to be living and working in such a great metro area.  Eventhough we are currently experiencing a downturn, I believe the outlook for future growth is strong.  Your Thoughts? 

As many of my clients begin to feel the pinch of reduced or flat revenues and higher costs, they are beginning to look for ways to improve their bottom lines.  Understandably, many are taking a hard look at their marketing expenditures, specifically the dollars spent on advertising. 

While I whole-heartedly agree that our marketing expenses should be reviewed regularly and assessed for effectiveness, I place a word of caution out that we should not haphazardly reduce and eliminate marketing efforts and spending while chasing profitability.  Assuming we are in business for the long haul, this is exactly the time to continue with marketing plans and advertising programs that keep us in the forefront of our customers' minds.

So, what can we do to ensure that our marketing dollars are being spent wisely during the crunch times?  Well, perhaps this is not the best time to reconfigure your entire brand, requiring new marketing collateral and programs to develop an entirely new brand.  That might be money better spent at another time.  We should, however, keep spending in the more tactical areas of our marketing plans such as targeted direct mail campaigns, coupons, use of e-newsletters, staying in touch with current and previous customers and referral networking.  Look for niches in your product line, services or customer base that can grow during these tighter times and go after those specifically.  And, finally, use the Internet.  The Internet is a great, cost-effective way to get clients to your door via your website.  Use Google ads and SEO techniques to get your name in front of potential customers.  Make sure your landing page has a call to action and effectively communicates your message.

There's lots we can do to ensure that we are effectively marketing and advertising during these difficult times.  Don't be afraid to try something new.  This is your opportunity to gain market share as your competitors act from fear and pull their advertising and reduce their marketing efforts.  Your Thoughts? 

Many of my small business owner clients are finding their accounts receivables to be increasing this year.  Their customers and clients are experiencing some cash flow crunches and delaying their payments, in turn causing some cash flow crunches for my clients.

While most small business owners are not surprised by their increasing receivables balances, I am concerned that many of them are not reacting quickly enough to the situation.  In addition, to communicating with current clients with overdue invoices, it's important for business owners to be sure that policies, procedures, systems and measurements are in place to ensure that future credit sales are more profitable. 

Policies and procedures -  Prior to even making the sale, we must be sure to have credit policies in place - who do we extend credit to and how do we assess credit worthiness.  Also, we must have established payment terms in place.

A System to manage receivables - Once, credit has been extended, the business needs a system to track outstanding receivables with established steps to handle overdue accounts based upon age.

Measurement tools -  Take the guess work out of knowing how well you are doing with your receivables.  Use financial ratios and statistics to track your progress versus historical performance.  One simple financial ratio is the Accounts Receivable Collection Rate (in days) which is the accounts receivable balance times 365 divided by total credit sales.  Many other statistics are available as well, some being industry related.  Be sure to view your receivables in terms of your credit sales revenue since a higher receivables balance in and of itself may not be all bad - if your sales are increasing as well!

Your accounts receivables are costing you real money.  That's uncollected cash that could be used to grow your business, pay off debt or make payroll.  It's an opportunity cost that we want to minimize in order to maximize our cash flow.  Your Thoughts?  

From talking with many of my clients, I am happy to report that they tend to think that the difficulties in the economy are overly exaggerated.  Many of the business owners that I know are continuing to grow their top line or, at worst, holding steady.  However, they are getting squeezed on the expense side with the rising cost of raw materials and utilities.

One way to offset this squeeze on margins is to increase prices.  But before you run off and increase your prices to offset your increased costs, I suggest you pause and reflect strategically:

1)  First, how do you wish to position your products or services?  Are you competing in the lower end of the market where volume is king or at the higher end where service is.  Your pricing should reflect where you wish to participate in the market.

2)  Were your prices positioned correctly before your costs began to skyrocket?  Do you have some backpedaling just to get where you should have been all along?

3)  What role does branding and marketing play in your strategy?  Maintaining marketing and advertising during turbulent times is often vital to success.

4)  And, finally, consider the entire picture.  Look at the margins both gross margins and profit margins on all of your products and services.  Don't just arbitrarily raise prices to cover costs.  Think about repositioning some products, adding services, increasing advertising, changing marketing tactics and, then finally, how does all of that affect the pricing of each product and service individually and as a whole?

As a final note, think about the long term - where do you want your business to be positioned once we are past this blip in the economy?  I'll bet you want to be financial sound and well positioned with your customers.  Keep that long term perspective in mind and think strategically about pricing.  Your Thoughts?

We, at The Growth Coach, have concept called the FUDS which is an acronym for Fears, Uncertainties, Doubts and Suspicions.

The FUDS is that little nagging feeling of self-doubt that holds us back from doing what we need or want to do.  For example, its the FUDS that keeps us from making those phone calls on our to-do list because "I'm just not very good on the phone".  Or, limits our growth with larger clients because "I don't think we're ready to handle that large of a project".

Don't get me wrong - everyone suffers from the FUDS on occasion, after all, we are human!  But often times we procrastinate on a project or task and don't even realize that it's the FUDS at work. 

So, next time you are hesitating to start a project or can't seem to get something important done, ask yourself:  Do I have the FUDS?  What am I unsure of?  And, then put a plan in place to get past it.  Sometimes just recognizing those dastardly FUDS is more than half the battle!  As a coach, I often help my client recognize their FUDS and identify ways to overcome them.  What are some of your FUDS?

If time management is an endless series of decisions then it is very important for us to make strong and appropriate decisions every minute of every day.

Inappropriate decisions produce frustration, low self-esteem and increased stress.  Often these poor decisions are symptoms of poor time management.  We can improve our time management skills by learning to:

• Establish priorities based upon our most important long term goals
• Realistically scheduling our time
• Eliminating low priority tasks
• Taking action on only those tasks that will drive us toward reaching our goals or, alternatively, give us pleasure
• Making timely decisions
• Make a decision to not procrastinate

What are your time management/priority mangement challenges?  No worries - We all have them?  Let's go about making baby step improvements this week!