Of course, you have a plan to make money. That’s why you started a business. Actually, the question runs far deeper than that answer. You need a “pro forma income statement”. I know what you’re thinking,
“A pro forma income statement? Wow! Is it Christmas already?”
When running a new or existing business you always have to be thinking about money, particularly where is it coming from, whether it be from investors, profits, loans, or some combination. To be thinking and getting the money, you always have to be planning. There are often a number of red flags that frequently appear in business plans that tip off investors or users that you have not done your research, you are just guessing, or you are so enthusiastic about your idea you refuse to face reality. Some of the most common red flags include the following or similar terms: [Read more…]
Everyone talks about creating an environment that encourages innovation, change, openness, new ideas, etc. In many cases this enthusiasm for innovation, however, ignores a number of powerful practices:
There are lots of great tools, rules, and accountants to help businesses complete and analyze profits, sales, and costs. Unfortunately, this is an area where clients frequently throw out the baby with the bath water. They often fail to use Gross Margin Analysis. Most business people understand the basic rules surrounding Gross Margin. They just don’t execute them.
How come when I hear grandparents describe their grandchildren or parents post pictures of their kids on Facebook, the pride and descriptions are off the charts? For instance, a child’s first steps are frequently described or photographed as if it were ballet or a sports performance. When I read or listen to business plans, mission statements, or introductions to startup businesses, however, they frequently sound alike and do almost nothing to make the entrepreneur sound special. For example, what makes a business sound special when they use some of the following phrases: fair prices, well-constructed, trendy, top quality, and excellent customer service?
Being a successful business entrepreneur requires being able to maintain a healthy balance between passion and reality – between the emotional reasons why you’re in business and the realities of carrying out the day-to-day tasks in getting the business off the ground and keeping it afloat. To put the odds of success more in your favor, it helps to think like a journalist who is trained early on to use the five “w”s and a “how framework”.