This Ends Larry on Business. Tuesday We Begin Larry on Scholarships

I will stop posting Larry on Business with this post. I appreciate you following this blog.

I began this blog in July 2011 to help business owners grow their businesses. I’ve helped thousands of owners in the past two decades. I’ve worked with business owners in 30+ countries. I’ve helped them develop business plans, marketing plans, operational plans, and human resource plans. My client businesses improved revenues, sales, and profits. I am grateful for those who read this blog over the past 18 months. I also wish to announce that this will be my last post for Larry on Business.

Decide What to Do and What to Stop Doing

Business owners should focus their businesses on what they do extremely well. Authors proclaim “Stick to the knitting”. Jim Collins researched that great companies develop and adhere to hedgehog. To find that one thing your business does better than anyone else, and do it over and over and over.

He also encouraged businesses to stop doing things they may do well. They needed to avoid things that distract distract them from their core skills and business. Eliminating efforts on good things allows business owners to focus on better things.

For that reason, I will no longer post about business growth. Others enjoy better competence and thoughts.

Join Me to Learn How to Get Scholarship Money for College

I will replace Larry on Business with a new blog www.LarryonScholarships.blogspot.com. I will post the new blog on Tuesdays, Thursdays, and Saturdays.

LarryonScholarships will focus on five steps to help youth, their parents, and other adults who want to get money to pay for college—money they don’t have to pay back (though we will also deal with loans a little bit):

• Set a goal for how much you want and believe they want to reward you
• Find sources of scholarships, grants, and other financial aid
• Prepare master applications so you can complete applications in less than 60 minutes
• Write reusable essays to submit with applications
• Obtain impressive letters of recommendation that verify your accomplishments

Tuesday, January 1, we begin our new blog www.LarryonScholarships.blogspot.com

Set Goals that Will Grow Your Business Next Year

Each year people, including business owners, set resolutions (I prefer goals) to grow

People set New Year’s Resolutions. Businesses set projections, targets, objectives, or goals. Unfortunately, resolutions frequently become the but of jokes because few last until March. Stock prices rise and fall based on large corporations meeting their projections or not. The consequences for smaller companies fall short of stock fluctuations. It impacts revenues and profits. It reduces money the business owner get to take home to provide for their family.

Typical Goals Businesses Set

Each business and each industry set unique goals. However, several goals remain common to almost all businesses and industries. These common goals include:

• Increase profits to $XX
• Increase revenues by $XX
• Increase sales by XX%
• Improve productivity by XX%
• Improve your current product or service
• Research and develop a new product or service
• Improve efficiency in production by XX%
• Increase accounting accuracy and efficiency by XX%
• Reduce overhead by $XX
• Add or reduce the number of employees
• and others

I realize that many of these goals seem obvious as you read them. However, I’ve talked to thousands of business owners that failed to consider, let alone set, many of these goals. Goals inspire us to grow and to improve.

Set SMART Goals

People generally subscribe to two thoughts on setting goals:

• Set aggressive goals that you may not achieve, but will cause you to do more than you might have done
• Set goals you know you can achieve because the consequences of failure overshadows improvements short of the projections

I promote the first option if failure to achieve goals will not affect your psyche or stock price. I find I achieve more when I set a goal that will stretch my efforts. I accomplish more by trying. The old saying “Aim for the stars and hit the moon” represents the first thought.

On the other hand, publically traded companies and others must use the second option. Plummeting stock prices devalue the company when you don’t meet projected earnings.

Saturday we will announce the end of the Larry on Business blog posts

Merry Christmas! Look Beyond the Season’s Shopping and Business

Merry Christmas to business owners, employees, and clients. May Christ’s peace be yours

Today, we celebrate the birth of Jesus Christ in Bethlehem. Magi came from the East to honor the King of Kings they saw in the stars. Following a new, bright star, they came to the City of David to see the child. They bestowed gifts upon the new king of gold, frankincense, and myrrh. Their generosity affiliated gift giving with Christmas to this day. Unfortunately, the commerce of gift giving has overtaken the original intent of the Magi’s presents to the King of Kings.

Christmas Not Commercialism

During the Great Depression families bereft of cash and money made their own Christmas gifts. Since that time consumerism combined with commercialism changed the tradition of gift giving. Today, we concentrate on finding the best, most unique gift. Black Friday and Cyber Monday replaced Christmas Eve and Christmas Day as the most important days of the year.

“City sidewalks [are still] busy sidewalks, dressed in holiday style.” However, I doubt that “above all the bustle, [we] hear Silver Bells.” Too many people fail to even try to listen to them. They focus on the deal or discount they can find. They forget that giving honored the King of Kings.

True Purpose of Gift Giving

Gift giving honors those we love. We honor our children, our parents, our extended families, and our neighbors. The Magi loved the King. They gave very expensive gifts. The costs of the gift were not relevant. The depth of their love and adoration mattered more. The gifts we give matter little. The depth of our love and charity (the pure of love of Christ) matter most.

Christmas is a time to receive the greatest gift—the atonement of Jesus Christ. “For what doth it profit a man if a gift is bestowed upon him, and he receive not the gift? Behold, he rejoices not in that which is given unto him, neither rejoices in him who is the giver of the gift.”

Thursday we discuss specific goals you set to grow your business during the new year

Successful Business Operations 3: Client Relationships Grow Business

This continues our series on successful business operations and how the grew the business

Jared and Sarah Stewart teach “People do business with people they know, like, and trust.” They also share that “Every opportunity has its root in a relationship.” Their counsel resonates with me. I believe it resonates with you. I know thousands of business people who accept and act to build relationships. Let me share another example.

Built the Business on Relationships

Lance Black and Jarid Love founded Eli Kirk to help clients connect more effectively with their targeted market. Their services include strategy, design, and development. They develop mobile apps, software development, media, branding, web, and other services.

Their web site proclaims “We Love Better. Loving better means loving strategy. Our purpose in every engagement is to help clients communicate as effectively as possible while achieving maximum ROI—but that doesn’t happen by accident. It happens through well planned, thoughtfully conceived strategy. An oft-quoted New York department store executive once said, “I know I waste half the money I spend on advertising. The problem is, I don’t know which half. Our response? Hogwash.”

Notice they speak in relationship terms like loving and engagement. Their clients includes Mitt Romney, Donny Osmond, Landesk, and Novell.

Give Back to Your Clients and Friends

Eli Kirk believes that giving back to clients, friends, and others is good business. They provide volunteer work to civic, non-profit, and other worthy causes. Lance, Jarid, and many of their staff serve on community boards of directors. They contribute financially and in-kind to the community.

Another example of giving back to the community includes their annual Slash Bash. For the past five years they host more than 500 people and their families to the Slash Bash the day after Halloween. They provide free doughnuts, apple juice, and gifts. They offer activities like paint gunning pumpkins, slashing pumpkins with samurai swords and machetes, and dropping pumpkins 80 feet from a crane box.

Every opportunity has its root in a relationship.

Tuesday we discuss how Randy & Kelli built their carpet cleaning business by great service

Successful Business Operations 2: She Grew a Successful Craft Business

This continues our series on people who grew small family businesses into thriving ones

Many people start businesses because they have a good idea. Others start businesses out of desperation. Some start their business with grand ideas of amazing profits. Many people, however, start a business to add a small income to support their families. For a few, their business grows unexpectedly into a fantastic revenue generating machine.

Creative, Organized, and Active

I will call this owner Mandy, since she has not chosen to make her name public. Mandy grew up in a very creative family. Her father, who died recently, loved music, creative farming, and fixing things. Her mother enjoyed creating things with her daughters. Mandy carried on the tradition. She decorated her home with stenciled wall coverings, hand painted clocks, toll painting, and more.

Soon, she and another sister blogged Simply Home and Family. They shared recipes for sugar cookies, ideas for cute hair ribbons and braids, and place’s to take the family. They showed beautiful pictures on their site. While Mandy and her sister intended to show people how to do it themselves, many people wanted to buy the crafts she displayed.

Web Tools Extend Everyone’s Reach

On June 15, 2009 Mandy joined Etsy as Abbie’s House. She described her purpose on her about page “At Abbie's House, we are working to create great products that will help organize your home and family life. We offer high quality, durable, and helpful products to busy families. We would love to hear your questions. comments and ideas. Thanks for stopping by.”

Etsy allowed Mandy to expand and reach a much larger audience of millions. People loved her child’s measuring board, her personalized family money, and her magnetic chore charts. Sales increased exponentially. Mandy’s daughters helped her, around the kitchen table, manufacture each product, hand painting, gluing, and more.

Recently, sales expanded so much that Mandy and her family started a much larger home with a manufacturing workroom for the expanded business. She’s another success.

Saturday we will share how Lance and Jarid helped Donny Osmond, Mitt Romney, & others

Successful Business Operation 1: She Turned a Family Business into Success

This begins a short series on family business operations that led to successes

Women start a lot of businesses. Many start a business so they can stay home with their children while adding to the family income. Many create good companies because they possess entrepreneurial interests and inclinations. Women starting their own businesses avoid the glass ceiling that some of their sisters encounter in a more traditional workplace.

Start with Something You Love

Alison Chuntz started Alison’s Pantry in 1987. She loved fine food. She saw a business opportunity providing families with good restaurant quality food they could prepare themselves at affordable prices.

“Alison's Pantry is a wonderful, local company that truly cares about their customers.  Alison Chuntz works closely with her sons, Joshua and Jesse Kissee.  Their efforts are to offer you the finest tasting products on the market at the most affordable price.  This is a company that sincerely enjoys helping you save money.”

Established in 1987, Alison's Pantry™ began distributing food products from a small building in Pleasant Grove Utah, to many of the rural Southern Utah communities.  Our company grew rapidly and we soon expanded our service to rural farming towns in the Rocky Mountain states.  In 1994 we built a large warehouse just off State Street to house our growing business.  We began delivering from a pick up truck and trailer in the early years of our company; we graduated to two beautiful, modern semis in the mid 90's.  Our facility is 23,000 square feet and houses all our food products until shipped out fresh to your home.”

Recognized Similar Needs in Others

Alison recognized that other women also loved fine food and needed additional money. So, she decided to distribute her great food through a network of sales representatives in rural communities. They sold the product in a variety of methods from parties, door-to-door, referral and more. Alison resisted setting up down-lines like in multi-level marketing preferring to keep her sales representatives part of a family.

Alison successfully sells food in 6 states.

Thursday we will share another family business operation that grew exponentially

Business Failure 15: Solutions That May Help You Avoid Failure

This concludes our series on reasons for business failures

Businesses fail for a variety of reasons. In the pervious posts we discussed several reasons. While many of the causes for business failure rely on the economy or other causes out of your control, you can prevent most of the causes we discussed with a good (yet flexible) business plan, a mastermind team, and visits to public or private consultants. 

A Good Business Plan

Most business owners prepare a business plan for banks or investors to get money. One very successful owner prepared and operated from his business plan. He believed preparing everything on paper before he spent a dollar helped build his business. His plan was dirty, dog-eared, and marked up because he referred to it almost every day.

Preparing and using a business plan  forces you to consider and contemplate your:

• Business idea, uniqueness, management team, and other people assets
• Market analysis, competition, client profile, and product schematics
• Marketing plan including market research, marketing message, strategy, campaigns, methods, vehicles, sales, and client retention
• Financial plan including funding, financing, milestones, accounting, statement of accounts, general ledgers, accounts payables, and accounts receivables
• Purchasing plans, discounts, suppliers, vendors, and cost analysis

Mastermind Team

Mastermind teams work together to help one another achieve their goals:

• A mastermind team consists of 4-5 people who want to improve their lives.
• The team meets once a month for about 90 minutes
• Each team member
  • States their goal
  • Outlines the action they took with results
  • Asks for brainstorming ideas from the others with challenges or problems
  • Describes 2-4 actions they will take before the next meeting

 Public or Private Consultants

You can also avoid business failure through the advice of public or private consultants. You don’t have to pay a lot of money for public programs such as

• Small Business Development Centers (SBDC)
• Service Corps of Retired Executives (SCORE)
• Business Resource Centers (BRC)
• Centers for Entrepreneurship
• Manufacturing Enterprise Programs
• Business Incubators

Private business consulting firms also exist in your community or on-line. Find good ones for you.

Tuesday we begin a series containing stories about business operations

Business Failure 14: Refusal to Hear Bad News or Make Excuses

This continues our series outlining reasons businesses fail so that you can avoid failure

We mentioned denial as one of the human follies. Refusal to hear bad news or make excuses goes deeper. Some businesses or industries react to bad news by sticking their metaphorical head in the sand. Others rationalize bad news with excuses casting the blame for their own decisions on other people or circumstances they perceived as out of their control.

Refusal to Hear Bad News

Bad news comes from all sources and about all facets of your business:

• Equipment and facilities break down and need repair
• Suppliers inform you of their bankruptcy or major price hike
• Your biggest client cancels a major order or tells you their sales dropped by 80%
• You find your best employee has been embezzling from you for years

Ignoring the news will close your business. Acting on it may save it.

Make Excuses and Blame Circumstances

Forbes published a story about business failures. The article said “Refusal to hear bad news immediately.  Great companies don’t make excuses, including excuses about how they didn’t do well because the economy was against them or prices were not good.”

We have been inundated the last four years with business owners who never had trouble with their business for 10-15 years. They also never developed a business plan or learned how to market. Instead of recognizing their own failures, they blamed the economy. They blamed the big national stores that moved into the neighborhood. They blamed the big plant, who was their only client, that closed.

The key is not that the bad things happened. Nor is it that the bad things affected their business. What matters is what the business owners did about it.

• One answer, complain and blame it on the business environment. This answer does nothing to solve the problem or save the business.
• Another answer, accept what happened and plan a way to adapt, resolve, or solve the problem. This allows you to move forward and possibly save the business.

Saturday we will conclude and summarize our series on business failure

Business Failure 13: The Familiar Stuff of Human Folly

This continues our series outlining reasons businesses fail so that you can avoid failure

Business owners are human. They are not perfect. They don’t possess super hero powers. Sometimes they make mistakes or suffer from common human frailties and follies. Frequently, these human errors can result in problems with the business. These errors can result in business failure. They may lead you to invest in product lines that will not give a good return on investment. They may cause you to ignore good advice from others. You may chase a dream that cannot deliver results.

Familiar Stuff of Human Folly

First, let’s examine what might be considered the familiar stuff o human folly:

• Denial: I coached business owners who denied all the good advice they received. They denied clear evidence that their business idea lacked sufficient earning power. Others denied poor sales figures and lack of client response and continued pouring money into poor quality products.
• Hubris: The dictionary defines hubris as “excessive pride or self-confidence; arrogance” It can lead you to proceed on the assumption you can do no wrong.
• Ego: Your ego may prevent you from seeing mistakes or challenges arising in your business. Conceit can taint your perception of things.
• Wishful thinking: I’ve seen businesses fail because the owner’s wishful thinking caused him or her to chase fanciful or ill-conceived products, advertising, or plans.
• Poor communication: Owners may miscommunicate product guarantees or miscommunicate instructions to employees that result in costly errors or lawsuits.
• Lax oversight: Running your business may dull you to employee theft, overcharging from vendors, and corporate information hacking.
• Greed: Taking money out of the business that you should reinvest can ruin your business. Raising prices to satisfy your greed can lose your clients. So can paying wages so low that you can’t keep good employees.
• Deceit: You lose trust with your employees, clients, or suppliers when you cheat or lie to them. I mentioned earlier a dishonest boss who lost his business because of his deceit.

Learn from these follies.

Thursday we discuss how refusal to hear bad news immediately can affect your business

Business Failure 12: Toxic or Rotten Corporate Culture

This continues our series exploring reasons business fail so you can save your business

A lot of businesses fail because of a rotten corporate culture. Sometimes the culture’s rot stems from underhanded dealings with others. Rotten cultures can come from vindictive even intimidating owners. Some rotten cultures fester when owners and executives cover up secrets, illegal acts, or unethical behavior. Maintaining a rotten culture requires a lot of work and resources that divert resources from success. Eventually toxic cultures erode and destroy the company.

My Personal Story

My first full-time job after graduating from college was with a company with a rotten corporate culture. The rot began with the owner. He kept  copy of the book Winning Through Intimidation on his desk—facing those who sat across from him. He had cut 1/4 of an inch off of the front legs of the chairs facing his desk to keep people off balance when they met with him.

His dishonesty permeated the business. He falsified performance numbers which determined bonuses for his employees. He would call the office every morning at 8am and again at 5pm for no reason other than to verify people were at their desks. Yet, he would lie about where he was and what he was doing.

He pitted employees against one another. For example, he came to me and told me the branch manager was incompetent and he needed me to step up and exert more control in the office. At the same time, and unknown to me, he told the branch manager that I was too uppity and that she needed to put me in my place and manage me better. Then, he waited to see who won. He did the same thing with 3 employees when I became manager.

Examine Your Corporate Culture

Determine any rotten or toxic habits in your corporate culture. Counter them with positive principles, values, and mission statement. Create situations in the company to enhance and internalize those positive values and virtues. Practice them. Live them.

Tuesday we will explore how the familiar stuff of human folly can destroy your business

Business Failure 11: Greed & Make Money for the Money’s Sake

This offers another insight into why businesses fail so that you can avoid them

Charges of CEO and business owner greed ricochet around our media sources. Headlines decry “Greedy CEO’s eat away at our economy”, “Greedy Hostess Executives will fill their own stockings with bonuses” and “It pays to be a greedy CEO and screw over your workers”. However, you probably are not one of those $12M executives. Nevertheless owner greed or zest for making money for money’s sake can still doom your business.

Getting Greedy & Focusing on Money Hurts Your Business

Businesses your size depend on good relations to succeed. You build relationships with clients, vendors, suppliers, and your staff. Relationships suffer when money becomes your focus. Greed distorts your perceptions and thoughts. When greed and money becomes your focus you may tend to

• Pressure vendors and suppliers to cut costs, provide shoddy materials, & then delay paying them
• Provide products that lack quality, while charging higher margins than they deserve
• Pay penurious wages to your employees, outsource, and deplete morale and loyalty
• Cut moral and ethical corners to get more money
• Lose sight of why you started the business in the first place
• Neglect your family to spend more time working when you don’t need more money

You may fall prey to any or all of these problems if you allow greed or making money for money’s sake to enter your life.

How to Avoid Greed & Making Money Your Prime Motive

You may take several steps to avoid feelings of greed or money:

• Change your view of the world from one of scarcity to an abundance mentality
• Identify a good charity or cause and donate money to those worse off
• Stay close to your staff, family, clients, and vendors so that you see them as people
• Know when to reduce your drive for money, create a team to help stay on target
• Keep your money low key and avoid ostentatious symbols of wealth
• Read scripture and good books that will help you focus

Saturday we will highlight how a rotten company culture leads businesses to fail

Business Failure 10: Solutions to Lack of Cash or Overextended Cash

This continues our series analyzing why businesses fail, how to avoid business failure

While your business may experience cash flow or cash strapped problems occasionally, persistent cash problems represent serious problems with your business plan or implementation. Fortunately, several solutions exist to resolve the problems. Unfortunately, many business owners resist many solutions. 

Possible Solutions

Business Know How provides several possible solutions:

• 12 ways to get startup funds
• Avoid being ripped off by business loans scams
• 5 Steps to grow beyond the $5 million mark
• 39 cost-cutting tips for your small business
• Should your purchase or lease business equipment?
• Get loan with the bank that turned you down
• and many more tips and suggestions

Crowdfunding

Alan Hall shared 5 Ways of Funding a Business: How to Get Your Peace of the Pie for Forbes.com. He lists Crowdfunding as the 3rd most effective way to fund your business (right after personal funding and family and friends). Crowdfunding represents a relatively new way (the term first appeared in 2006 from Michael Sullivan) of raising capital.

My daughter used Crowdfunding to obtain special supplies for her public school district pre-school class for autistic children. She wanted to buy special equipment for her class and needed about $2,000 to do so. She posted her project on a Crowdfunding web site. People go to these websites and commit so much money. She raised all $2,000 within 24 hours.

Currently Crowdfunding for businesses reminds me of the wild west—out of control. The JOBS Act which President Obama signed into law on April 5, 2012 established a timeline for the Securities and Exchange Commission to clarify guidelines for business Crowdfunding. Currently, some serious benefits and drawbacks exist. Explore the pros and cons before listing your project. Don’t rely on Google to help you. The first 8 pages of my search for pros and cons only listed paid ads.

If you want to know more, several sites offer this unique source of funding. Check them out, but use caution.

• GoFundMe.com
• Crowdfunding Professional Association
• GoBIGnetwork.com

Thursday we examine how undisciplined greed & money for money’s sake leads to failure

Business Failure 9: Lack of Cash or Overextended Cash

This continues our series outlining reasons businesses fail so you can avoid them

Running out of cash may define business failure, as in “We’re out of money, so we’re going to close the doors”. In this post, however, we’re going to discuss how poor funding or mismanaged financing contributes to business failures. Many businesses begin with too little money and never overcome that hazard. Others possess enough money for well planned growth, but cannot support reckless overextension and growth.

Problems for Underfunded Startups

Studies indicate that most companies begin with too little cash. Startups receive their initial funding from any one of prime sources:

• Income from a full-time or part-time job
• Personal funds
• Family funds
• Credit cards
• Collateral based personal loans (including second mortgages)
• Small Business Administration guaranteed loan
• A wish and a prayer

Frequently business owners start their businesses knowing they have less money than they should, but hoping it is enough. Actual startup expenses regularly exceed anticipated budgets. Starting with less money than you forecasted, coupled with actual spending exceeding forecasted, quickly closes many new business.

Other business owners keep pouring additional money into their business in a desperate attempt to recoup earlier losses or resuscitate a struggling startup. The additional funds trickle in from other income, family, or other sources—too small to alleviate the problem—just big enough to keep the business going.

Overextending Finances

In addition, to starting with insufficient cash, you may overextend the cash you possess. Overextending means that you decide to do more in your business than your cash can support. Common actions that may overextend your cash include when you:

• Commit to a lease on office space you really don’t need
• Sell more product than you can produce or purchase with the money you have
• Open too many stores or locations in a gamble they all will succeed
• Hire too many employees (especially for seasonal or cyclical times, but keep them on afterward)
• Advertise through expensive and less productive methods
• Begin production on your idea, with expensive prototypes, with little feedback

Tuesday we discuss solutions to lack of cash or overextending your cash