Business

Common Small Business Problems Hinder Success

One of the advantages of consulting is that you get to see others’ mistakes. And learn from them. I have made more than my fair share of mistakes. Yet, I still am surprised by how often the basics underlying how you run your operations are the most common small business problems.

Good administrative processes will support and enhance your ability to grow and succeed. Set them up early and properly to be effective. Boring work, probably. Critical, yes!

Financial literacy is quite low in the US.

Whether you are a financial whiz or barely understand cash flow, you need effective financial processes in your business. You need a system that is right for your size and work. But you also need to understand and use it. Get basic training. Or hire someone to help you set up your own chart of accounts and understand what your system can do for your business. Then add help to maintain it as needed.

Your ability to manage your cash flow is critical to your success. And your tax returns are far easier with a good system. So is your planning!

Yet… recently it was a long-time business owner whose bank account was overdrawn before he realized he had not seen his outside book-keeper in months and his employee was not entering everything correctly. Last fall it was a CEO who had not made payroll on time – again; but thought employees should understand good intentions!

And don’t even ask me what happens to firms which do not pay employee tax withholding on time – think locked doors, seized bank accounts, personal assets at risk.

How are you hiring and paying for services your business needs?

Do you have employees? Independent contractors? Contractors or consultants? Interns?

Tax and labor laws […]

Retire? Me?

Retire? That’s a discussion for others……… isn’t it?

A century ago, we worked until we died or became disabled. The Depression and WWIIgave us Social Security and pensions. Now we have folks fearing they will never be able to retire – while many losing their jobs in the recession are involuntarily doing so.

Personal capacity building

Have you actually thought much about retirement? Do you, like many, intend to get around to thinking about it …. sometime? Do you love your work so that you fool yourself into believing that you will never retire? That your circumstances will never change? The most common predictor of early retirement for men is illness or job loss. For married women: the disability or illness of their husband.

 
Retirement
Retirement has both financial and personal aspects. Many of us don’t plan for either. And real planning should begin early, at least five years out for both.

Do some personal ‘what-if’ planning. Studies show that women still are more likely to be the care-givers. And this may mean that you will, as I have, end up caring for several older relatives in their last years. Dealing with the medical, emotional, and housing issues is not easy. All these and others related to aging family take far more time and energy than you expect — even if you can afford good help. And this hits your business directly, often disastrously.

Retirement and disability issues are all more difficult if you are a business owner. You can stockpile large emergency funds, buy key-man insurance, have disability insurance and a retirement plan for yourself, take other steps, or do all of these. But you still need to discuss what might happen with your family, your partners, your lawyer and CPA and other advisors – and plan!

For those of us […]

By |December 11th, 2012|Business planning|0 Comments