Now that the holidays are over, many of us feel the need to take a deep breath and let it out as we pause and reflect on the year behind us while also looking to the year ahead. The beginning of a new year is a great time to create a vision for the coming days and to get clear about goals for your business. Business owners would benefit from taking the time to map out a plan for the future before the year gets away, even if it seems difficult to invest the time. You can save time for yourself and your employees down the road by getting your year started with purpose and focus. So what is a business to do in planning for the future?
As you sketch out your plan, consider the broader vision questions, such as What do I want my business to be known for? How do I want people to talk about my business when it comes up in conversation? Reconnecting with your original intention for starting the business in the first place is also helpful in realigning goals. As you do so, remember to consider what sets your business apart from all others. If you sense this distinction hasn’t yet taken hold in the public mind, use this knowledge as a springboard for your goals moving forward. Though it can be uncomfortable for a business owner to consider areas of weakness in the business, the reality is that no business is perfect. What sets apart an excellent business from a mediocre one is the courage and willingness to be real about areas that need improvement and to then move forward with purpose and clarity in addressing those weaknesses and turning them into strengths.
After you’ve spent some time considering the big picture questions, it’s time to get down to the brass tacks of running your business and improving your processes, spending, advertising, etc. While every business is unique and has varying needs, good practice is good practice, and certain tools and habits are beneficial no matter what a business’s specialty is.
We talked with local experts to get some tips about areas in which businesses can benefit from planning as well as an understanding of the services these experts offer to help you in setting goals for 2020.
Perfect Your Business Processes and Operations
One way that any business can bump efficiency and success to the next level is by refining the business’s processes and operations. Jethro Hopkins, co-founder of No Coast Business Advisors, offered advice to business owners on this topic:
“The most important item is getting your processes in order. Everyone working in a business should know how it runs whether or not the manager is present. If processes and expectations are clear and in place, goals will naturally fall into place as well,” he said. “One goal that every business owner would do well to define is creating an exit strategy for the day the business owner plans to hand off the reins to someone else, and a plan for owner loss. It should be simple for someone else to step in and see how everything works.
Unfortunately, many people don’t think about this ahead of time. Businesses with no exit plans in place get a lot less money and pay more in taxes. These businesses only end up taking home about 78% of the sale price on average. For businesses worth more than $5 million, the statistics look very different. This is because eight out of 10 of these business owners have an exit plan in place ahead of time. Consequently, they end up taking home an average of 110% of the sale value for their businesses, which also tend to sell more quickly and with less of a headache.
At No Coast Business Advisors, we help get your processes and operations in order and create a clear exit strategy so you can easily pass the torch to someone else and become part of the percentage that takes home the value of your business or more when you sell, and as painlessly as possible.”
Create an Exit Strategy and Keep the End in Sight
Whether or not you’re nearing retirement, creating an exit strategy isn’t only a good idea, it’s highly-advisable. If a business owner spends large amounts of time and resources building and growing a business, it is only natural to want a return on the business once it is time to retire. Having an exit strategy can make this possible.
Lutz Consulting and M&A Shareholder, Bill Kenedy, gave us more insight into the importance of business owners looking toward the future of selling a business.
“Be forward-thinking. Spend some time gaining knowledge of what drives the value of your business and how you can improve the business’s transferability,” he said. “Lutz M&A can assist business owners in understanding the best long-term business transition options for them, including the value of their business, given the desired transition structure.
Too often, business owners focus only on short term goals without giving proper attention to their eventual exit from their business. A successful business transition typically requires several years of planning. We see business owners with misconceptions about the value of their business and the difficulty of selling their business, whether it is to family, employees, partners, or outside third parties.
We advise business owners against procrastinating on exit planning and believe it should be a high priority for every business owner due to the fact the value of their business is typically the majority of their net worth.”
Bill and the rest of the team at Lutz are willing and ready to help anyone create an exit plan and ensure top return on their business investments.
“The time is here! Baby boomer business owners are beginning to reach the point where they need to exit their businesses. We have seen a significant increase in business owners contacting us for assistance with developing transition plans.”
Refine Your Budget and Financial Plans
No matter the industry, one thing every business has in common is the need to budget. Especially at the outset of a new year, it is important to define your budget so that it aligns with your primary business goals. We spoke to Mark Nave with SP Group, P.C. about tips on budgeting for success.
“At this time of year when business owners are busy setting goals for 2020, it is important that the goals they set are specific and relevant goals that are key to the success of their business,” he said. “I believe one of the most important tools for setting and attaining those goals each year is preparing and setting a budget for your business. Many business owners often overlook this important planning tool, but it can be a guide to improving and growing your business while also helping quantify any other specific goals.”
Mark outlined some of the reasons budgeting is so important for businesses.
- “Budget planning can be an important tool for any business,” he said. “Some of the benefits a budget can provide include:
- Accounting for growth in your business and determining the appropriate staffing to fulfill expected growth and customer needs.
- Predicting the company’s cash flow, for future capital needs, or setting aside additional emergency funds.
- Identifying potential financing needs of the business.
- Identifying areas of spending that may be in excess of need, or areas where margins should be increased.”
Through S.P. Group’s accounting and advisory services, businesses looking for extra help with budgeting, tax prep and planning, and other financial services can find peace and confidence about their business’s future. S.P. Group’s focus is providing their clients with the services they need in order to achieve success.
If you have a budget in place but feel you need additional help with financial advising, Bethany Arnold with Edward Jones is a great person to talk to. Bethany partners with business owners and their team members, including their CPA and/or lawyer, to ensure that the business entity is structured in the most tax-efficient way.
“It’s important for me to find out from my clients what is important to them and what their goals and desires are for their business,” said Bethany. “Through an established five-step process, we partner together to find out where the business owner is at today, where they see themselves in five, 10, 15+ years, and how they plan to get there, especially if they have big growth plans.
Here at Edward Jones, we will sit down with you and find out what’s important to you in order to help you reach your goals, whether it be cash flow, taking advantage of the gifts and opportunities the government has to offer you for being a business owner, or simply being a sounding board for you,” explained Bethany. “We want to help you achieve those goals, watch you grow, and celebrate when you succeed!”
Bethany understands how vital financial planning is for businesses.
“I often see people who don’t have a plan,” Bethany shared. “They have great ideas and great products, but no plan. It’s important to know that you will hit hurdles and there will be days you don’t want to move forward, but if you have a plan and stick with it, you will prosper.”
Clinton Hlavaty with CS Accounting offered advice on devising a plan to reach goals for your business: “It’s really important to have goals,” he said. “If you don’t have an aim, you can’t hit it. I recommend using the SMART method to devise goals that are specific, measurable, attainable, relevant, and time-based. At CS Accounting, we are all about sitting down with our clients to learn more about their work and their desires so we can come up with a plan together. It’s all about the relationship! While we certainly believe in making money and having a clear plan to maximize income, we understand that it all starts and ends with good relationships. We really listen to our clients and establish trust, and then we create a plan together to help them succeed.
We offer bookkeeping services and bring our knowledge of new tax laws so our clients can focus on their business instead of trying to keep up with changing policies. We also advise clients to work with us in coming up with multiple scenarios for the future, because the future is unknown. 2020 is an election year, and none of us knows what that will bring. We can help you do your due diligence so you are prepared for whatever comes. It is important to have a reserve in place for unexpected situations and emergencies. If you feel overwhelmed with the thought of making these plans, let us help!”
In addition to bookkeeping services, CS Accounting offers individual tax return preparation, accounting, and consulting. Whatever they do, they do it with a smile, and their clients can’t help but smile in return for the excellent services they receive.
“I love to help my clients get organized,” Clinton said. “It’s always a good idea to hold onto receipts for accountability. CS Accounting can help you keep track of your expenses so you can see where your money is really going and stay in-check with your budget.”
As you review your budget, you may find that certain seemingly small expenses are taking a toll on your finances. Many businesses find credit card processing fees to be particularly burdensome. Clearent Intelligent Processing offers solutions to this problem.
At their core, Clearent is a credit card processing company that takes a hard stand against hidden fees and pricing tricks. Their commitment to quality, transparency, and unwavering customer service are the basis for everything they do because they are a payment processor committed to doing the right thing. Clearent is tenacious when it comes to the pursuit of making things better so their clients can be their most profitable. Humble innovators, the Clearent team built their payment technology – Horizon™ Processing Engine, Quest™ Payment Gateway and Compass® Reporting Tool – from the ground up. They are passionate about providing the kind of service that people don’t really expect anymore. They love to show their clients that different is better while helping them save money.
CurrencyPay helps you unlock your business potential as the first payment platform designed for buying and selling large-ticket items. With CurrencyPay’s services, you can optimize large-ticket transactions with ease through multiple payment options so your customers always have a way to pay for larger purchases. In addition to traditional payment methods such as credit, debit, and ACH, CurrencyPay allows you to offer your customers flexible financing at the point of sales. There are no long-term commitments with CurrencyPay—you can process payments on your terms so you can focus on growing your business.
Finally, CurrencyPay provides exclusive inventory finance programs for you, allowing you to take advantage of a custom-tailored experience, including 0% interest for 90 days and more. CurrencyPay also offers exclusive benefits for LIBA members, like free processing and fee rebates.
Select a Location That Aligns with Your Business Goals
As you formulate your plan for your business, you may find that your current location does not serve you in achieving your most important business goals. As they say, location, location, location is so key for the success of any business, though finding that perfect location can be a challenge.
The best location is, obviously, one that minimizes expenses and maximizes income. An ideal location is conveniently placed and easy to find, with adequate parking. Also important are maintenance factors—is the building old and constantly in need of repairs and upgrades? Is the building newer with great features and amenities yet outlandishly expensive? Does the location draw the right population for your services and help you achieve your business goals? Such questions can plague and overwhelm an already busy business owner. Fortunately there are experts who help business owners solve these problems every day.
Cathy Kottwitz with Guiderock Commercial Realty shared her experience of helping business owners find a location that can help the business grow and prosper.
“I primarily work with business owners who are looking to open a new location or move their existing business,” she said. “I help clients select a site that aligns with their current needs and future goals, whether that’s finding a flexible space, upgrading to a better location, or moving from a leased space to one the business owns.
One of the most common issues I see is not having enough time to find a location. I typically recommend getting some general ideas for locations and costs about a year in advance of when a business needs to be up and running in a new location and planning to start actively looking six months in advance. This allows time to assess options, negotiate terms, and remodel a space if needed. That may seem like a long lead time, but it goes by quickly and is necessary to get the right place on the best terms.”
When looking into available commercial space, John Linscott with Greenleaf Properties suggests that one of the most important services a real estate agent can provide a client is representing the tenant’s interests during lease negotiations.
“Because of the intricacies of leasing a space, you certainly have to understand what you are getting into,” John cautioned. “A commercial real estate agent will represent the tenant and help them with site selection and lease negotiation.”
Real estate agents can help locate the best options available on the market, and by comparing properties, they can ensure they are being leased at a fair market rate.
“One of the most important things is the details of the lease concerning maintenance and repairs,” John informed us. “This is the kind of thing, unless you deal with leases all the time, you might not pay attention to. For example, you may not realize when you sign up that you are responsible for equipment replacement, which can be a $5,000 to $6,000 bill.”
Greenleaf Properties is a team-driven commercial real estate firm assisting clients throughout Nebraska by offering a full cycle of services and forward-thinking strategies. Greenleaf provides professional services in the areas of brokerage sales and leasing, asset and property management, facility maintenance, and land development. They are a great resource for anyone seeking the perfect new location for a business.
If the kind of change you’re looking for is one that gives you an established office away from home but does not lock you into the responsibility of paying for and maintaining an entire facility or building, Michael Holroyd with Holroyd Investment Properties (HIP Realty) has experience assisting clients who aren’t necessarily looking for a traditional office space but desire something that is more flexible and suited to the modern business scene.
“There’s been a shift away from working at home or in coffee shops to designated spaces to conduct business that promote creativity and the exchange of ideas with others, which has also been shown to increase productivity,” Michael said. “As a result, there are more ‘middle of the road’ options for office space that fall between the two extremes of working from home or having a standalone place of business and singlehandedly shouldering all of the costs that come along with it.
HIP OffiCenters can assist any new or established business by not only leasing them office space but helping with all of the other services that come along with it as a package deal that provides significant value for our clients.
At HIP OffiCenters, we staff a professional receptionist in a comfortable lobby to greet all of our tenants’ customers. We professionally answer incoming phone calls for our tenants, which allows them to focus on taking care of their existing clients and building their businesses. Perception is important, and we strive to help you make every experience for every customer the best that it can be. The Executive Office Suites are easy to find and offer free parking next to the building. Our large, spacious offices give the professional atmosphere our clients are looking for, with a host of amenities that further enhance the experience for both tenants and their clients.”
Improve Your Marketing Approach
In laying out an updated business plan, weak points may become apparent in your current business strategy. Perhaps you will find that your business has not received the recognition and positioning in the industry that you desire. While investing in marketing and advertising may seem costly and unnecessary to some, smart business owners recognize that marketing is key to positioning a business at the top of its industry. One important aspect of marketing is keeping up with trends and changing policies, especially when a business owner is looking to contract with government agencies.
Taylor Law, Procurement Technical Assistance Center (PTAC) Consultant with Nebraska Business Development Center (NBDC) offered insight and advice for businesses looking to land top-paying contracts with the government.
“When dealing with government contracting, it takes time to market and build those relationships, especially when the sales cycle is much longer in B2G lines,” he said. “With the PTAC program at NBDC, we offer significant value with helping businesses understand and navigate the complexities of selling to the government, whether it is to a federal, state, or local agency. Our services help businesses register in the right places to be able to do business with the government. We also help businesses get certifications that may help them be more competitive. On top of these services, we help businesses put together their marketing materials that are specific to government contracting, like their capability statement or their Dynamic Small Business Search (DSBS) profile.
There are a few misconceptions that are common. The first one is that once you register in the correct places or are certified for one of the set-aside designations like HUBZone, the 8(a) business development program, or as a woman-owned small business, that contracts are just going to fall into your lap. The government market is no different from any other sales process in that the government also wants to do business with who they know and who they trust. A business needs to put in the work to actively market themselves to agencies and to build those relationships. This will also help you in the end as you may start to hear about opportunities while they are in the planning stage or before it hits beta.sam.gov as a solicitation. The more time you have to work on a proposal, the more likely it is to be successful.
The second misconception is for a business owner to think that, for example, because they do not sell guns, ammunition, or missiles that the Department of Defense is not going to want to talk to them. The Department of Defense buys much more than just weapons, and with a budget of over $600 billion, they are one of the largest customers in the world. They do construction projects, they need computers and janitorial services. Just about anything else you can think of that a person uses in their day-to-day life, the Department of Defense needs as well.
One service we offer that I feel makes the largest impact with businesses, especially if they are new to government contracting, is the market research piece. The ability to gain an understanding of which agencies buy what you are selling, which businesses are winning contracts, and which contract vehicles are being used to procure what you sell is paramount. This information is vital to understanding and formulating a sales strategy. It allows businesses to understand there may be more agencies that buy what you sell than you realize and helps you to become the business they choose to turn to for services.”
Business planning for the future, whether it’s planning for the next year or for the next five years, is a great way to get a laser-like focus on where you are and where you’re going. A plan can help you identify what expert services you may be missing that can take your business to the next level. We look forward to seeing your business soar and hope 2020 is your most successful year yet!