Article of the Month - Belt tightening

Because of the wide variety of small businesses that read our Small Business News, this month's article can be read in a variety of contexts. However, regardless of whether your business suffered because of the Covid pandemic, or if your business has been booming during this health challenge, the exercise we are selecting in this month's article will surely work in your business.

Following the directions of the article, the exercise will take you but a few minutes and will easily show you what aspects of your business expenses should be the focus of your attention. And, because of your choices, it will show what areas of expenses are on "auto-pilot".

Who is visiting Small Business Conversations this month? - The SBDC

As we write this month's Small Business News, we are unable to confirm exactly who will be our guests. But safe to assume, our guest experts will be two from the state and national level of the Small Business Development Center.

You will be sure to learn how your partnering with the SBDC, and asking for an advisor to be appointed for your business will provide you with free, individual counseling for you. Whether you see an opportunity or a challenge for you and your business, this will place a highly qualified individual in your corner.

Book of the month - Never split the difference; negotiating as if your life depended on it by Chris Voss with Tahl Raz

We like a book that we can suggest for small business that comes from a non-related field. This is one of those books. Chris Voss is a former international hostage negotiator. His approach is field tested. Perhaps you are negotiating with a vendor, the purchase price of a vehicle or equipment for your business; this can work to your advantage.

Some people have that natural skill. Our son, Darren, is one of those people. The rest of us could use this book.

Internet Tool for Your Business - planning markdowns

The reason behind the creation of this month's Internet tool, the planned markdown calculator, came from an experience of my working with a select group of members of an international trade association.

The small audience was individuals who were to be the next generation of family management in the businesses. The lesson was about understanding how to buy; and perhaps "not to buy".

We utilized an example of inventory purchased that was to be sold with a 30% gross margin. As the group shared the experiences in their businesses, the consensus was they started with the inventory being sold at full margin and followed by three markdowns at varying points of time.

The group agreed how much their first, second and third markdowns would be, as well as at what point, based on inventory on hand, the markdowns would occur.

Putting this information into the calculator we are suggesting for this month, they found their overall margin was 16.67%. Definitely their businesses would not continue to exist if that process was continued throughout their business. Neither can you in your business.

Our solution in our example? If these businesses would have bought only enough inventory to make it through the first markdown, they would have kept a healthy margin.

Hence the expression; sometimes, less is more.

This is the example from one experience. You should use the calculator with your numbers. Then you will have the answer that is right for your business.

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.

Staff Incentive for Your Business - Group decisions

The staff incentive comes from a personal experience. Our business was making progress in building a strong team. We had created a staff education program which was showing great results. The business we had at that time had 15 employees working part and full time.

I don't remember where the idea came from, but we decided that those of us who were charged with the responsibility of being the supervisors, and myself as an owner, needed occasions to get together and make our plans as a group.

We decided we would meet once a month for breakfast an hour and a half before the business opened. One person volunteered to be the recording secretary and we took turns developing the agenda for each meeting.

What I remember as the strongest testimonial to the results of this breakfast meeting was a couple of part time employees who volunteered to open the store on the morning of these meetings. Their comment was, "We are loving the results of these meetings and we want to contribute".

The incentive? Involvement and the feeling that you are making decisions.