Business Planning in 2017
As we approached the end of the year and now that we’re beginning anew this month, those of us in the business world share a common focus: planning for the year ahead. If you fall into the category of business owner or one of the many other professionals who in their roles, are responsible for all aspects of an organization’s operations, you likely already understand that planning is critical to your continued success. However, with so many different areas to concentrate on, it first begs the question: Where do your priorities lie?
It can seem overwhelming to approach the decisions you’ll be making now that will shape your business in the future. By going through your business plan and seeing what needs the most attention this year, you can narrow down your planning efforts and then turn to the experts to help you put these plans in place. Here are just a few different areas that you may need to consider for 2017.
Developing a Business Plan
For those who are embarking on a new business venture in 2017, putting together a business plan is the first item on the agenda. Having a documented plan in place is crucial, and if you’ve never done this before, enlisting the help of a professional is wise. A business plan, the foundation of everything you’ll do moving forward, is the best way to ensure you will remain on the right trajectory towards meeting your goals. A well thought out, organized business plan with conservative revenue projections is also great to have on-hand in the event you’ll be presenting to potential investors and helps the bank understand every detail of the new business.
Putting Together a Team of Advisors
With so many bases to cover, it truly does take a village of professionals to help you see the big picture along with the little details. A team approach will also help in keeping you abreast of everything that’s going on in each industry that plays a part in the success of your business.
Take business finance for example. Anytime you’re making decisions that will affect the bottom line, it is important that you get sound advice and have a plan in place for the future. Key professionals that most business owners utilize to ensure that finances are in order include an accountant, tax preparer, insurance agent, payroll professional, benefits advisor, payment processor, financial planner and so on. As such, each of these individuals will be able to offer a different perspective in assisting you with evaluating your successes and shortcomings from 2016 in order to help you plan accordingly for the year to come. In the interest of efficiency, you might even opt to work with a firm that wears a few of these hats.
Let’s focus a bit more on the first professional mentioned, your accountant. Working with an accountant can assist a business owner in budgeting, tax planning and timing of purchases. The more contact you have with your accountant, the more they get to know your business and the better they can serve you.
“Our firm places a great emphasis on year-end tax planning for all of our clients,” says Mark Nave, a Certified Public Accountant with SP Group, P.C. “We believe it is important because proper planning does not just entail minimizing our client’s tax liability, but also it includes planning for our client’s future growth, cash flow expectations, and how it fits with our client’s personal financial goals.
Right now in our industry, we are proactively monitoring and evaluating the proposed changes the newly-elected administration will make to our tax code. Based on the administration’s initial tax plan, many businesses will likely see a lower overall tax rate and individuals will now likely be subject to only three tax brackets for the 2017 year. Especially this year, there is more importance on planning for our clients due to the possible upcoming changes to our tax law.
With the proposed changes made by the new administration, it is likely all businesses may need to reevaluate their current entity structure and determine if it is the best fit for their future.”
He also notes, “A topic that is often overlooked is how businesses plan or prepare for their expected growth. It is important that business owners are always evaluating their potential for growth and how their business will be affected due to staffing needs or improvements to infrastructure, among other things.”
Switching gears from your business’ finances on paper to the physical exchange of funds for your products/services, even the way you accept payments could potentially benefit your business in other ways if planned correctly. There are a lot of options offered remotely by companies not based here in our market, but by working with a local company, you’ll protect your interests and have access to support when you need it.
“Setting up and working with a credit card processor you can trust is key, and one that’s local is preferable,” advises Adam Roberts of First American Payment Systems. “Someone you can look in the eye, with whom you can shake hands and establish a personal working relationship. It will help you avoid a lot of the pitfalls that remain in this industry, and ensure you’re only paying for exactly what you need.
I got into the credit card business and found out two things right away. 1. What this industry does NOT need is another processor – there’s way too many out there in my opinion. 2. However, what it DOES need is a lot more honesty. We process for a little auto repair shop in town whose previous processor charged them $60/month for 48 months for a credit card machine. They call it a 4 year lease – and I see this a lot. We totaled it up and he ended up paying almost $3,000 for this machine over 4 years! I told him, ‘Sir, I don’t mean to tell you this to make you mad, but I would’ve given that same machine to you for my cost, only $150! And you own it. At the end of a lease they’ll make you send that thing back! It’s highway robbery if you ask me.’ So we do things very differently in our local Nebraska office.
Many companies will simply sign up with the first credit card processor they’ve heard of or that calls them on the right day. It’s understandable because they need it to do business. But not knowing the industry and what to look out for, they’ll often end up with a bad deal, such as a lease, or with a company on the coast.
There are processors out there that will get you on hidden fees, setup fees, application fees, leases on machines, and then on top of that, won’t tell you the whole story in terms of rates. Plus, oftentimes if you actually do meet with a real live person, you’ll sign up and never see them again! With First American our philosophy is ‘You sell it – You service it.’ We take care of our customers with dedicated local service and support. We are located right here in Lincoln; our office is downtown by the Capitol building. I don’t want my customers to call an 800 number; I want them to call me and our local team. And if our clients have a problem or issue we can literally BE THERE on-site within 20 minutes. Frankly, I don’t know any other processor, locally or even nationwide, that offers that kind of speed and support.”
He also notes, “As far as technology, what we’re able to offer businesses is pretty incredible in my opinion. For example, we have a new system for restaurants, supermarkets, and high-traffic businesses, that with a click of a button, will tell them how many first-time and repeat customers last week/month/year, what they ordered, zip code, spend metrics, and more. This helps you to target what your best items are, what you may need to discontinue, what items bring customers back and where they’re coming from, and so on. Plus it ties in with your Yelp, Twitter, Facebook, and Open Table campaigns. You can reply to all of your reviews on each different platform, all from a single page. And this is all done through credit cards and payment processing tools!”
Among your trusted advisors should also be your attorney. As far as planning goes, they’ll help you put in place, and guide you through following, both a short-term and long-term business plan.
Christine Vanderford of Vanderford Law, PC LLO advises, “In order to make certain this is done properly, a business owner should utilize professionals to create a financial strategy for growth, as well as a marketing strategy and a business succession strategy, whether the succession of ownership of the business is based on death, disability of owners and/or shareholders, or sale of the business. It is especially important for businesses to plan for and take care of these matters, not only to ensure the growth and success of the business but also to achieve the ultimate goal of getting the most out of your business as possible.
As most business owners put a majority of their assets and effort into making their business sustain itself long term, it is of the utmost importance that they have the professional guidance so they are moving in the right direction and are free of costly errors and setbacks. Without proper legal advice, a company can get set up incorrectly, or without proper liability protection, threatening the future of the business. Ongoing legal support of the company can ensure the growth of the company continues to flourish with tax efficient strategies and limited liability.”
She also notes, “It is equally imperative for business owners to review their estate plan periodically to ensure their estate planning documents reflect the current status of their business. This is essential to protecting the family if an unexpected death of the business owner occurs. It is really important that the estate plan of the business owner reflects any business succession plan and changes that might be made over time.”
Preparing for Transition
Among the professionals you might want to consider bringing into the mix, a trusted business advisor is also a valuable resource. The buying and selling of businesses happens regularly, and as such, many people will be planning to do one of the two, whether it will be happening in a few months or in a few years. This can be a complicated matter, so it’s important to have the guidance in place so that you’re doing exactly what you need to do at the appropriate intervals so that you stay on the path to the ultimate goal.
“With respect to business planning, our expertise lies in helping our clients prepare for a transfer of ownership as well as planning accordingly for any period of transition,” says Jethro Hopkins, owner of No Coast Business Advisors. “Whether it be selling the business or passing the torch on to the next generation, we join forces with our clients’ team of accountants, financial advisors and lawyers to plan for the transition so everything goes as smoothly as possible.
If you are thinking about selling your business in the next couple of years, it’s crucial to focus on the financial records now. This alone will play a major role in the business’s value when it comes time to sell. It’s important to track all transactions, especially purchases, as a part of the profit and loss statements. Having a legitimate paper trail for all of the business’s finances can actually increase the value of the business because you have quantifiable proof to show potential buyers. Moreover, it is wise to begin paying yourself as an employee as opposed to taking your cut of the business’s profit. It’s all about strategizing to get the most for your business, so presenting the most accurate reports of overall revenue (and profit) of the company is critical.
It’s very hard to sell a business if the reported cash flow is under $100K, which is classified as a “microbusiness,” but those above that number seem to do quite well in the current market. If you need to get your business to that point in 12 months or less, you’ll need a somewhat aggressive, quick-start strategy in place. No Coast Business Advisors just began offering the NAABB Marketing Academy program, which I highly recommend as a cost-effective way to have access to local consulting services on a regular basis as well as a plan to follow backed by proven results from participants nationwide.
For those who may not be planning to sell in the near future, market valuations are still the most critical of our offerings to have done. This provides a benchmark of its value which can be referenced for all sorts of things, such as loans, future planning, partners, dividend payout estimates, and much more. We recommend that any business get one done annually at the very least. The program that I just mentioned also has a second phase that helps businesses get to $1M annual profit, so if growth is in the plans, it can certainly help you get there too.”
Talent Acquisition and Development
Human resources is a core area of any business with employees. Many times, working with a staffing company is the perfect way to take the bulk of human resources tasks off the plates of those who have no formal training, putting it in the capable hands of the experts.
Partnering with a staffing company, like Nesco Resource here in Lincoln, can have a positive impact all year long. If a company is in need of temporary help, using a staffing company provides the people resources to complete the job without the commitment of a long-term hire. For permanent staffing needs, a staffing agency allows companies to make sure the employee is the right fit before they hire by providing temporary to hire options. For skilled and professional positions, utilizing the resources of a staffing company means candidates can be pre-screened and evaluated based on their qualifications prior to being considered by the company. This cuts down on the volume of non-qualified candidates and provides for better use of the time and resources of the company. By using a staffing company throughout the year, a business can avoid all the administrative processes that come with hiring, allowing them to focus on other priorities.
It’s not only about finding the right people, and what you’re doing to attract the best and brightest professionals, but developing those minds once they’re a part of your workforce (this may have even been happening beforehand if you’re lucky and the groundwork has already been laid out ahead of you).
“We assist our customers in the business planning process by focusing on their most important resource – their people,” emphasizes Don Tomlinson, Chief Information Officer at Talent Plus. “Our focus is on the selection and development of individuals, working to put the right individual into the right position. This starts before they are officially hired. Do they have the talents to be successful in that role? Once they are onboard, how do we develop them? In addition, we know that every individual needs a solid succession plan. How do we create this? We now have an automated tool for the first time to allow associates to put development right back in their own hands. This means less oversight from management perspective and more ownership on an individual employee to guide their career goals. You can download the need-to-know details on this important tool, our Strength Development Plan (SDP), at go.talentplus.com/TheSimplicityModelArticle.
A true look at developing leaders within their workforce is what will help companies innovate long into the future. Whether its leadership coaching for managers, the c-suite (go.talentplus.com/LeadershipPlus), or succession planning for leaders at every level, we focus on turning talented people into leaders for the future. So often we see companies wait until the senior executives are aging out of the workforce to think about succession planning. Realistically, for a business to thrive, you need to start the process of developing them from day one no matter what level of the organization they’re at currently. People do have potential to grow into more developed roles and the sooner you scientifically identify who your ‘next in line’ is, the sooner you can offer them the tools and training to be able to meet and conquer the career challenges that lie ahead.
During a normal business planning meeting, new opportunities for the business are identified and strategies around the opportunities are created. Many times, this creates new positions and roles for individuals inside the company. Organizations typically fill those roles by looking within the ‘company family’ and figuring out who is the best at what they do, assuming they would make a good leader too. Just because you are the best in a department does not mean you would be the best at leading that department. But organizations do this all the time. Talent Plus® helps organizations look at how they can fill positions that accompany business change. We look at the talents of the individuals and what success looks like for the new role. We then match the best individual for the position.
As far as timeline for business planning, organizations tend to focus on six to twelve months in the immediate future. This creates an environment of incremental change. If organizations really want to be effective, their 2017 plan should be a sub-set of their three- or five-year plan. You should be looking all the way out to 2020 at this point, and perhaps even beyond that. In addition, don’t be afraid to get feedback on your plan. While keeping it secure, it’s ok to validate your strategy with key stakeholders, such as important clients and certain individuals within the organization.”
Insurance Coverage and Employee Benefits
As this is crucial to attracting the best and brightest talent, you’ll want to review the benefits you are offering and plan for any changes you’ll be making in the coming year. Health insurance coverage remains a chief concern for business owners and employees alike, but there have been more options made available locally, such as concierge medicine and corporate wellness programs, that are making the current situation more manageable for all.
As far as employee benefits packages and incentives go, corporate wellness programs have become very attractive and remain all the rage so to speak.
For planning purposes, there are a wide variety of things you could implement that would improve the health outcomes of your workforce, which in turn benefits your business.
“At Proactive Solutions, Inc., we offer on-site wellness, ergonomic, and injury prevention services,” explains Katie Tiedemann, Midwest Regional Manager of Proactive Solutions, Inc. “We’ve been an integral part of the business decisions our clients have made in many key areas, including increasing productivity and efficiency with current headcount, resolving issues impacting the health and safety of employees, lowering insurance costs, injury prevention, reduction of workers compensation costs, and unbiased support for all levels of the management team.
Through LEAN techniques, EHS supportive programs, and our unique, proactive process, employers achieve their business goals faster and in a cost-effective manner. Our techniques have been proven successful when implemented in all business environments, from Fortune 500 companies to local, family-owned businesses. One example that comes to mind is a medical manufacturing client who brought us in to resolve the high rate of compensable injuries they were experiencing. We took their initial recordable rate of 7.0 and reduced it to 0.73, which has been maintained for the past 5 years. During the process, we also assisted their engineering team in increasing productivity by 800%, maintained current headcount, and have saved them $110,000 per month on average in health and safety costs through our program to date.”
Regarding these focus points, Tiedemann offers the following advice to business owners: “When planning, consider what you are doing to ensure a productive and healthy workforce. Your employees are your most valuable resource, and so many things are often missed when evaluating the needs of your business when it comes to your employees. This is our area of expertise; we evaluate, identify the key areas and then develop a comprehensive plan to achieve your goals and measure the results for long-term sustainability.
Above all, for anything related to business planning, my advice is to bring in a fresh set of eyes. You will quickly realize that you only know what you don’t know, which could be limiting your business and your employees.
We have several strategic partners when it relates to technology for health-wellness. The good thing is we know what really works and what is just a fad tied to a good sales pitch. Let us help you decipher what you really need and save you a lot of money.”
In the vast tech space, there’s always something new being introduced that you can use to your advantage. Looking into options for upgrading, whether it’s adding something new or a better, more advanced version of existing technology you’re already using, has become an integral part of a business’s planning process in modern times. Infrastructure, internet speeds, networks, data storage, equipment, and software, the online landscape in general – it can seem as though all of these are in a constant state of change because for the most part, they are and that’s a good thing. There are exciting things coming to the Lincoln area to check out, and it also doesn’t hurt to have an expert come in and evaluate where you’re at currently so that they can make recommendations about key areas of improvement for the coming year. Due to the fact that there’s so much out there to explore, targeting where the most potential for improvement lies is a great starting point. With more breakthrough technology being introduced than most of us who are busy running our businesses can keep up with, but at the same time, shouldn’t be without, along with budget constraints that prevent us from investing in it all (even though we might want to), it’s only wise to do so.
“Small businesses should especially be looking toward the cloud to gain efficiency in their processes, reduce costs, and add new technologies to foster their businesses growth,” advises Jay Krull, Chief Technical Officer of Panology Tech Solutions. “The multitude of cloud-based offerings in the market today have driven the costs within reach. The value those offerings provide allow businesses to spend less time on routine efforts and focus more time on what makes them great.
In our line of work, we see many small businesses fail to budget for the replacement or upgrade of their aging technology. This can include computers, servers, printers, copiers, routers, firewalls, etc. Allocating even a small amount of your budget to replace these items before they break down can save you money and precious time.
We provide a technology assessment to ensure those leading an organization are aware of any areas that are in need of improvement. This allows time and budget for these areas to be included in planning. Our goal is to enable our business clients to be proactive rather than reactive when it comes to the technology they use.”
Establishing a Presence in the Marketplace
Last, but CERTAINLY not least, you’ll want to plan for how you’ll be marketing your business in 2017. This too will largely depend on your evaluation of the successes and shortcomings from the past year, goals for your business in the future, and your plans in other key areas. In this area, as with many of the others we’ve explored, no two business will have the same planning outcomes. As each business is a unique entity all its own, so is the plan that’s tailored to meet the strategic objectives laid out for branding and promotion across a calendar year. For some businesses, marketing efforts will be planned out a year or more in advance, while for others, decisions are actively made and new projects are embarked upon throughout the year, which still requires forethought and a timeline.
Andrew Tuzson, owner of Evol Empire Creative, offers the following tips based on his chief areas of expertise:
Depending on where you’re at in your business cycle and what your goals are, I’d advise any business owner to consider the following when doing strategic planning for the coming year:
- Do you have a user-friendly website that’s set up for conversion? (Now that you have their attention, what do you want them to do?)
- Are you dominating the top search engines like Google/Bing/Yahoo? (By that I mean appearing at the top of the first page of search results.)
- Are you doing anything to optimize your social media presence and grow your following? Have you created an engaging and hyper-focused experience in this space?
During the planning process, these questions will help you identify what needs to happen moving forward so that you’re leveraging all of these valuable tools to reinforce your message.
When I meet with a client to gain an understanding of where they fall within these three objectives currently and what their goals are for the future, I always lead with the website. You can drive traffic anywhere with your promotional efforts, but it’s a waste to spend money on getting people to that place if you’re not presenting your offerings online in a way that’s engaging, captivating and user-friendly. We live in a society of instant gratification. Thanks to platforms like social media, we have immediate access to more information than ever before and have become acclimated to skimming through it quickly. We’ve also trained ourselves as to what we ignore and how much time we spend in any one place.
It takes a lot to get people to slow down and engage when it’s so easy, and almost an instant response, to go from one thing to the next. As such, you’ve got to create a user experience that tells a story. When you’ve clearly identified what your conversion points are and have that factored into the story that you’re telling, that’s when you’re ready to market your website.
If that’s already been achieved, and you’re looking at your spend for the best ROI, dependent on your industry, it’s then all about creating consistency everywhere you’re at in the marketplace.
For the majority of businesses, it will come down to two different platforms or digital landscapes.
First, if your company does not hold a coveted spot on the first page of Google, your lost opportunity cost is through the roof. Years ago, before the Internet was a thing, if you wanted the most business, you set up shop in a high visibility location. This included your office or place of business, the yellow pages, billboards, etc. Now that location is online. Companies that don’t want to face that fact and adapt are dead in the water – it’s not a matter of if, but when.
Just to throw some rough numbers out there, upwards of 90% of Google searches will end on page one, and of that group, approximately 80% will select a result in the top three displayed. Statistics prove that it’s incredibly rare for people to go past the first page and on to the second or third, and if they do, it’s generally out of desperation because they have yet to find a solution to the problem. The vast majority of problems are solved much sooner. For those whose offerings address a common problem, you’ll need to rank high in order to get people to your website so that you have the opportunity to differentiate yourself from your competition. If you’re investing dollars in getting people to your site or in the door, search engine optimization or SEO is key.
The other key piece is social media. This is much more than a place where people post about politics, movies, and their problems. If used correctly, it can have a dramatic impact on a business’s success. No matter what product or service you provide, it all comes down to using the social space to humanize your company. When you cater to the human need for social interaction, you’re golden.
The most effective companies are now selling in a conversation, not a pitch. By focusing on creating experiences that reinforce you as the expert in your craft, you’ll attract attention organically. Combined with the visibility factor, you’ll be unstoppable in 2017.”
Tyler Horsley, Executive Director of Nuclear Networking, expands further on the topic of digital marketing:
“While you’ve probably heard the term ‘SEO’ thrown around, you might still be wondering what that actually means. My answer, in short, is that I’ve found it tends to mean something different to everyone. As such, we focus on educating our clients about what it means to us, and how we plan to achieve it for our clients. As certified Google partners, we focus on onsite SEO algorithmic compliance – How does Google see you? Is your site healthy? Is it loading fast? And so on. We’ve made a point to incorporate aspects of every version of what SEO is that we’ve come across thus far, addressing it from all angles online.
In fact, education is a key piece of what we do. It’s important to us that our clients are able to make educated and empowered decisions.
I often refer to the three things every business needs to address as the “three-legged stool”: Search Engine Optimization (SEO), Search Engine Marketing (SEM), and Local Citation Building and Optimization (Citations are core industry platforms that Google deems necessary for a strong foundation in SEO, local brand awareness, and function like microsites on each major platform). The union of the three is what will support your objectives for digital marketing, allowing you to succeed at capturing the attention of your target audience.
The majority of millennials are using the Internet exclusively to find services, that’s now a well-documented fact. Although in the Midwest, and Nebraska in particular, business remains very relationship and referral driven, you’re still missing a huge segment of the population, and therefore will have a significant missed opportunity cost, by neglecting your online presence. Being able to market effectively to this booming population will be critical to the success and longevity of businesses here in Nebraska.
Nuclear Networking began in the government sector, and then branched out to work with large, high-profile business clients nationwide, but we felt strongly that SMBs were the segment in the most need of our digital marketing services. We’re able to ‘bring a cannon to a stick fight’ when it comes to digital marketing for local businesses, bringing a level of expertise that can really make a difference where it’s needed most. At Nuclear Networking, we consider ourselves to be a business partner, not a third party contracting service. Our approach is to come alongside and educate through the entire process, to be a consultant, and to really help grow the business as a whole.
We pride ourselves on being very clear about what we can do and what we are going to do. A lot of times with other companies you’ll find in this space, the message is delivered as ‘Pay us X amount of dollars and we’ll increase your rank.’ Do you really know what you’re buying, though, or are you just relegated to ‘I hope it works, here’s my money?’ My job is to take my client’s/partner’s investment and multiply it through online and digital platforms. We create a customized competitive analysis that maps everything out – if you’re interested in competing in this space, here’s what your financial investment will be and the return you can expect. Most business decisions are made based on metrics and knowledge as opposed to what you hope to happen, and this is no different. We also customize three different strategies that you could go to market with as our recommended course of action moving forward. This is all provided at no cost, as is a lot of the education we provide, mainly because we want to be clear about what a partnership would entail to find out if it will be a good fit for both parties. Check us out at nuclearnetworking.com to learn more, and feel free to contact us at email@example.com.
It’s very important to at the very least get educated on your options. And to do that now, because although it’s not really affecting this market here as much as others across the U.S. at the moment, you can be sure it will hit here soon in a big wave and you’ll want to be the one who is prepared for that to happen.”
The topic of business planning is an enormous one and can include a number of different aspects, some of which are vitally important to your business and others that are not so critical but still be well worth exploring. The key is to focus on those areas that will have the most impact on your business’s success and growth over the next year and to partner with the professionals who can help you put the processes in place to move forward.