1. Business Plan

Every Business, large or small, old or new, should have an up-to-date Business Plan. And you should refer to it frequently.

You would normally think of the Business Plan as a tool for securing financing. That might be true, but its BEST use is as a Planning Tool. Duh!

If you have followed most Business Plan guidelines, you have done some major research and thinking about your market, your product, and how you intend to make money. That research is invaluable, and if you simply do it and then let it sit on the shelf, you have lost the value of your efforts.

Keep referring to the Plan as you do business. You’ll remember your market, your customers, your intent. You’ll keep focus and reach those financial projections you made. Without the foundation of a good business plan, you’ll drift into places where you can get lost and never recover.

Keep the Plan current and visible.

2. Accounting Records

Oh No! More Bookkeeping! Haven’t we had enough???

No. These are the most important records you have. A good set of books will help you pinpoint profits and losses, good customers and markets, suppliers, and profit leaks. Keeping Books is fundamental, and vital for not just taxes, but for your entire business operations.

I have counseled plenty of failing businesses who did not know they were failing, or did not know why. Good books could have prevented the tragedy and the pain of business failure.

Essential records are Cash Journal, Sales Journal, General Ledger, Inventory Records, Customer Records, and Accounts Payable and Receivable Journals. Most computerized bookkeeping programs have these and more.

Spend the money. Consult your accountant. Get a good program. Keep them current.

3. Standard Operating Procedures (SOP)

Every business has things to do and ways to do them. An SOP manual helps you get and keep organized for those routine tasks, and those rare but essential ones. It will also make it easier to train when you add employees.

Get a loose-leaf binder and some dividers. You’ll want to document your days, weeks, and months as you go along. Use the documentation to examine and improve those processes so you will always be moving forward.

Be especially alert to documenting those rare events. How to do a Backup of your computer. (Shouldn’t be rare, but should be documented just the same.) How to file various tax returns and payroll reports. As you learn how to do something, make an SOP for it so you won’t have to learn it again.

4. Your Daily Action Plan

This should drive your every day. You should never go to work without knowing Exactly what your goals for today are, and what you are going to do to reach them. This is more than a simple To-Do List. It is a well-considered Plan of what you intend to do and when.

Don’t let random events de-rail you from achieving your goals. Don’t think that you can spontaneously do what is right. You won’t. You will end your day without accomplishing much of anything, and a week’s worth of that will stretch into eventual failure.

Conclusion

Every Tool Box has a unique mix of tools and supplies. It is vital that you stock yours well, and that you keep those tools sharp and all oiled up for best use. The Right Tool for the job makes the work so much more effective.

And it’s Effective that you want to be.

John Larson

So it is with your business.

The 3 legs of your business are:

1. Production
2. Marketing
3. Administration

Your business will ultimately fail if these legs aren’t strong and of similar length.

Production

Production is getting your product or service completed and in the hands of the customer – on-time and on-budget. This is what your customers are paying you for.

This is your talent or skill. This is what you were good at when you decided to become a business owner. You are a good carpenter, web-designer, programmer, mechanic, typist, baby-sitter, dog-washer, card payer, musician, writer, butcher, baker, or candlestick maker… You KNOW how to DO the nuts and bolts of what your business does for others.

You have to be good in this area or else your reputation will precede you and you will eventually go out of business because you can’t find any more customers who are willing to pay for your mediocrity. Keep getting better. Practice, Read the Latest, Go to Seminars or School. Spend some time each day or week learning and practicing what you do so you will eventually be the best there is at what you do.

Remember to learn from every job or transaction.

Marketing

Marketing is everything you do to bring yourself new business. Without marketing, you will not have customers.

The best marketing is done according to choice, not chance.

Advertising is a large part of how to get new business, but who are you advertising to? EVERYBODY really does not need your product or service, so who, REALLY, would be your ideal customer? How would be the best way to get their attention? Spend plenty of time tuning up your advertising to make the most bang for your buck. Test the copy, test the channel, test the results.

Marketing also includes the “package” your product or service comes in. What little extras do you throw into the bag? How do you followup to be sure the customer is satisfied with their interactions with you? How do you get new leads from existing customers? Do you have an upsell or addon plan for each transactions?

Marketing is being thoughtful and consistent about generating new business. I had a client that taught me his dilemma. He had no business, so he’d “Market, market, market”. Then he’d have so much business he’d be buried for weeks trying to catch up – “Work, work, work.” Then, he’d run out of business and have to go back to “Market, market, market”. We taught him how to balance his time investments and “Market, Work, Market, Work, Market, Work…” His business and life became far less harried.

Build a Marketing Plan to keep you on track attracting more business for your business.

Administration

Someone has to keep all the wheels on the bus. Administration is that guy. You need to know how to or hire it done, but done it must be.

1. Planning
2. Money Management
3. Project Management
4. Time Management
5. Employees
6. Rules & Regulations
7. Taxes
8. Records and Organization
9. Maintenance
10. ??? What Else Do You NEED to DO to Stay On Course?

Without keeping these areas up and running, without backlogs, up-to-date, and active, you’ll eventually drown in the backwash.

Most of the clients I’ve consulted with have root troubles in this area. They don’t keep their bookkeeping up-to-date and they miss tax deadlines, don’t see that they are losing money on every job, and can’t stay ahead of the creditors. They run their business on scraps of paper or notes in their cellphone. They save it all up for a marathon session that never happens. Sometimes, they aren’t even aware of what needs to be done in these areas.

When you put together your Business Plan, include a BIG chapter on these topics.

When you go to do business, DO these Administrative tasks as well as you do your Production tasks.

Conclusion

Be sure to build all three legs into your business. It will fall over without paying attention to all these areas – in a balanced way. If you aren’t good at some of this stuff, hire it, out-source it, but get it done. Be a stable business for the long-haul.