February 2020
Volume #21 Issue #3

When it is time to leave; What is your plan?

There are few things I enjoy more than attending a trade show. It started with my memories as a child; getting up early and traveling to Little Rock. The trade shows were held in two hotels. Different from today's shows, the manufacturers and wholesalers would use the traditional hotel rooms; sleep in the room at night and use it as a showroom during the day. Today as I visit trade shows I thrill at seeing all the product and service offerings, with the exception of one type of exhibitor. Nothing against these exhibitors as they are fulfilling what they are asked for. These exhibitors, I will put in a group, are liquidators with the purpose of helping a business sell off their assets generally because the business owner has decided to close their business. This makes me sad for multiple reasons. The first is not wanting to see the loss of a locally owned business. Surely the business owner did not get into business with the intent to just close it some day. The second is the concern for their not getting the most out of their business when they are leaving. I am thinking of this today because of a trade association that is being proactive and helping members by providing what they need. This association is offering a service of advisors to help the owner prepare. It starts with a Certified Public Accountant who examines the business to determine if the current legal entity of the business is the right one for the owner as they transition out of the business. The second Certified Public Accountant is a specialist in business valuation. How much can the owner get for the business? The last person who should have input is the business broker who has the listing because they have a financial interest in the outcome. Persuading a business owner to lower a price by $100,000 is likely to affect the broker by only $5,000 while it is a $95,000 difference to the business owner! The next specialist is similar to the person that does the staging when a home is being sold. What can be done to make the building, other assets, and all of the business to look its best to a perspective buyer? A third Certified Public Account looks at how the information moves from the point of sale system to QuickBooks or other accounting software program. Many times this transfer of information is not set up correctly. The fifth person looks at the point of sale system. Is what the owner currently has antiquated? You know Windows 7 no longer receives support. Is there family involved in the business as owners, managers or employees? Another specialist helps with that concern. After all, today you may be in business together but after the business is sold you are still family. Specialist number seven deals with the service side of the business. Too many businesses that offer service have an owner who is the best service person. This owner will get more for the business if the next owner does not have to come in as a qualified service person. The eighth specialist looks at how the business works; the marketing, the business strategy,and the employees. This specialist also helps the business owner to understand financials so they can actively and intelligently participate in the conversation with the financial advisors and business broker. The time of a person transitioning out of the business is one of the most important periods of time. It is when a person is setting up for the rest of their life. Calling a business broker, or some local real estate business, to ask what you can get from selling your business is not the way to start that next chapter of your life.

Article of the Month - Extended Service

Keeping in line with some of the information shared above, the article of the month is about a business that services products. Far too many businesses see service as something they have to provide because they made the sale of the product to the customer. Instead, service should be seen as a profit center for any business. And as we mentioned, a business with a service department should not have the owner as the focal point of the service department.

Article of the Month

Who is visiting Small Business Converations this month? Joe Baer

One of the eight experts we described above, Joe Baer will visit with us in February. Joe's business, ZenGenius, is a group of merchandising experts in the true sense of the word. Unlike the many this writer has seen at trade shows and conferences who claim to be merchandising experts because they once worked for a chain store or tell us they can "read" the store to tell us what to do, Joe and his staff attend the leading world events such as EuroShop. Their degrees and certifications come from their work in the field of merchandising. Joe is the real deal.

Joe's firm has a service call, Visual 911, which we will ask him to explain to tell us how we can make changes that can improve the impression our business makes on customers.

Watch your email for the invitation to join us for a free one hour counseling session with one of the premiere experts on merchandising.

Book of the Month - Meet the HENRYs by Pamela Danziger

We are fascinated by the study of niche groups of people who can be our customers. One of our previous guests on Small Business Conversations, Pamela Danziger, has a book that deals with one of those groups; the HENRYs which is an acronym for High Earner Not Rich Yet.

We get the concept. This individual has a high paying job, but as they are young, they are just starting to amass wealth. You can see that over the next decade, this customer is likely to be building up some wealth.

Sound like a customer you want to know? Read Meet the HENRYs by Pamela Danziger to get an insight of how to attract and sell to this new customer.

Book of the Month

Internet Tool for Your Business - Days Sales Outstanding

We have a friend in Canada who is a part of a major wholesaler and frequently speaks with many of the business owners selling the products his company sells.

Clearly I remember the number of times as we have visited and he has talked about "days sales outstanding". It amazes him how much the business owner wants to be proud of the sales he and his staff make.

However, as he looks at their financial information my friend notices how long it takes this business owner to collect on those sales. The overwhelming majority of sales are made on credit terms for which his business sends a statement at the end of the month.

It takes most of the businesses he calls on much too long to collect those funds.

This calculator will show you how long those receivables are on your books and the money is not in your checking account. Look at it this way; when you are not collecting these funds, your business becomes a bank that gives interest free loans. Unfortunately, your vendors are not giving you interest free loans meaning this is costing you money.

Each month we highlight one of the 47 free tools on the Profits Plus website; we call them "calculators". While some provide analysis by numbers and ratios, some are assessments and others are self-examination questions. Many are downloadable while others, because of the complexity of the calculations going on behind the scene, are a part of the website and allow you to print your answers. None of them require you to give any personal information nor are there any "cookies" tracking you or your information.

Internet Tool for Your Business

Staff Incentive for Your Business - This pizza gives me an idea

Do you know Dale Lamoureux? World's fastest pizza box maker. How about Dennis Tran? World's fastest pizza maker.

Perhaps neither are the fastest, but according to Domino's they are as both are Domino's employees and are featured in television advertising.

What about the people that work for you? What can you say about them? We expect that Dale and Dennis are local celebrities. You could make your employees into celebrities in the eyes of your customers.

One of the basic principles of human need is that of recognition and the esteem of others which leads to having self esteem. All this requires is a bit of creativity on your part.

We want to recognize A Carrot A Day by Adrian Gostick and Chester Elton, whose book provides the basis for each month's incentive idea.

What's coming up that you can promote? - April 2020

The weather should be warming up for most of us in April. Here is a chance to warm up your customers by doing some things other than traditional advertising to get their attention.

Putting these together can be quick and easy, but should be planned in advance. As this is February 1, we are sharing ideas of what you can do in April.

Examples of April events include:
 
April  1 - April Fool's Day
April  1 - National One Cent Day
April  4 - National Handmade Day
April  5 - National Deep Dish Pizza Day
April  5 - Palm Sunday
April  9 - National Unicorn Day
April 10 - National Siblings Day
April 12 - Easter
April 15 - National Tax Day (USA)
April 20 - National Look Alike Day
April 23 - National Take Our Daughters and Sons To Work Day
April 24 - National Teach Children To Save Day
April 25 - National Pool Opening Day
April 26 - National Kids and Pets Day
April 30 - National Honesty Day

The month of April is:
National Canine Health Month
International Guitar Month
National Jazz Appreciation Month
National Volunteer Month
National Straw Hat Month
Keep America Beautiful Month

We want to thank National Day Calendar for this information. National Day Calendar -  Where the world gathers to celebrate every day.