Posts Tagged ‘entrepreneurs’
Wednesday, January 25th, 2012
Most economists that I’ve heard speak (well, two, to be exact) provide their services to major financial institutions and associations. Marc Faber is such an economist and he spoke to the local Chartered Financial Analysts (CFA) last night where a banker friend (yes, I’ll admit that publicly) treated me to dinner.
Dr. Faber has extensive global experience, having lived and worked in many interesting countries. His best credential wass that he visited Saskatchewan in January.
Here are the lessons for entrepreneurs.
- There are many investment alternatives including bonds, equities, real estate, cash and precious metals. These alternatives become more complicated when you factor in which industry sectors, countries and foreign currencies provide the best upside with the lowest risk. You need the help of a good professional to navigate all of this.
- Remember when our parents invested in Canada Savings Bonds? Life is definitely more complicated now.
- Interest rates will go up.
- Deficits in major economies such as the United States will continue to increase financial risk globally.
- Spending-and by that I mean government supported programs-on consumption is a short-term band aid solution that isn’t sustainable. Spending on capital such as equipment or research and development knowledge can create long-term value.
- Countries that print money, and that’s most of them, to try and stimulate the economy, end up creating long-term problems because they can’t control where the new money is being spent.
- A business that’s losing money won’t fix its problems by borrowing more money. You have to stop the bleeding first.
- The key difference between economists and entrepreneurs is that economists measure things with charts spanning decades and entrepreneurs measure cash today.
In my opinion, it appears that the best investment is in your own business! You know the customers, the suppliers, and the industry. You are in the best position to grow your business. Are you generating a healthy 10% or 20% return on investment in your business? You should be.
You must be proactive, know your numbers and act decisively. Otherwise, there is a factory in some foreign country that is using government funding to create jobs, doesn’t have a profit motive and is trying to enter your market with a ridiculous price. Sound familiar? Are you competing with five dollar an hour wages somewhere?
Here is my economic prediction: the experts still won’t be able to predict the future. No one can. That’s why you have to use your common sense. And, invest in yourself.
Copyright 2012. Phil Symchych. All rights reserved.
Tags: entrepreneurs, entrepreneurs and economists, Marc Faber, Phil Symchych, profitable growth, Strategy, Symchych, Symco, Symco & Co.
Posted in The Economy | No Comments »
Monday, January 16th, 2012
The best managers, running the most profitable businesses, know their numbers. Do you know yours?
Here are several key questions that, when answered, will give you a powerful insight into your company’s profits.
- What are your top three products or services, as a percentage of your total revenues?
- What are your gross margin percentages for these top products and your company average?
- How much of your total gross profits do these top products contribute? Remember, the 80/20 principle can apply here.
- What is your overhead rate by hour or person or unit of production?
- What is your break-even sales figure each day, week or month?
- Who are your most profitable customers?
- How much time and resources do you spend building relationships and selling to your most profitable customers compared to other customers or non-customers?
- What percentage of your revenues come from proactive selling vs. reactive order-taking?
- Which customers pay the fastest or the slowest?
- What is your days to cash? That is, how fast do you collect your cash. To calculate: Divide your accounts receivable into your annualized sales and then multiply by 365. The lower the number, the faster you’re getting paid.
- Are you actively promoting your most profitable products and services to your most profitable customers?
Knowing your numbers can reduce your risk from guessing and improve the probability of producing profits.
Copyright 2012. Phil Symchych. All rights reserved.
Tags: business, Business Growth, business owner, Business Success For Life, entrepreneurs, how to grow your business, how to improve cash flow, how to improve profits, Phil Symchych, profit, profitable growth, small business, small business consulting, Symchych, Symco, Symco & Co., SYMCO profit immersion, SYMCO profit matrix, SYMCO profit plan
Posted in Financial Management | No Comments »
Friday, January 13th, 2012
SUMMARY: Aim high. Encourage risk taking and support failure. Hold people accountable for results. Provide constant feedback. Banish excuses. Pay for performance.
If you want to achieve success, you have to aim for success. That means that you need a marketing plan and a budget that push your people to achieve more. You won’t replicate last year’s success because the market keeps changing so don’t aim for yesterday. You need to aim higher and then innovate and implement your way to success.
Never tolerate a break-even scenario. There’s no such thing in the entrepreneurial world. If you’re not gaining, you’re losing.
Employees think and act differently from entrepreneurs and owners, as we all know. They are scared to fail. Give them permission to fail! They will learn that failure isn’t fatal and that you will support them. This is how they learn and how they will eventually start hitting home runs for you.
Constantly challenge your people to perform more, better and faster. They’re not motivated by a paycheque (but some can be, see below for more). They need challenges and feedback on their progress in order to raise the bar.
Listen for excuses and then observe your own behaviour. Are you tolerating, or even encouraging, excuses? Your business value, profit and performance are all your responsibility. No excuses!
Once you’ve got them focused on raising performance, as determined by measurable outputs and business results, then align this behaviour with performance based compensation. Don’t give them an annual raise because the price of eggs and milk went up, start adding performance compensation to their base. If they are in sales, most if not all of their compensation should be variable. After all, as a business owner, all of your compensation is ultimately variable, based on your business performance.
You will achieve more success by trying to win instead of trying not to lose.
Copyright 2012. Phil Symchych. All rights reserved.
Tags: Business Growth, business owners, Business Success For Life, Customer Service, don't tolerate excuses, entrepreneurs, leadership, Phil Symchych, Phil's Profit Points, profit, profitable growth, small business, small business consulting, Strategy, Symchych, Symco, Symco & Co.
Posted in Business Growth | No Comments »
Monday, January 9th, 2012
There are two kinds of business start-ups: sprinters and marathoners.
Both have courage. Both want to control their destinies and both want to be successful. However, there are some key differences.
Sprinters
- Have experience and expertise in their business and industry
- Have learned the ropes on someone else’s dime
- Have good relationships with customers or prospects
- Generate sales and cash flow quickly
- Develop their operating policies and procedures on the fly, but get them on paper
- Focus on their core strengths and competencies, in other words, their ’sweet spot’
- Are comfortable saying “No” to requests or opportunities that don’t fit their sweet spot
- Have a culture of performance, accountability and success
- Attract great people and customers because of their positive attitude
- Are focused on a couple of key strategic goals; especially generating revenues and providing a great customer experience (quality, service, consistency, breadth, convenience)
- Can generate positive cash flow from zero to 60 days
Marathoners
- Have diverse experience but don’t have expertise in their new venture
- Are learning the ropes on their savings, investor’s or banker’s dime
- Think that their management skills are transferable to any industry or business
- Have good relationships with referral sources or prospects
- Generate sales slowly and steadily
- Are too busy marketing and selling to develop operating policies and procedures
- Try to keep everyone happy and will do just about anything for cash flow
- Have a culture of sales and customer focus
- Try to minimize their wage expense until they can afford to hire great talent
- Are focused on growth for growth’s sake
I’ve played lots of sports including hockey, tennis, golf (well, some people think golf is a sport, especially golfers), and participated in endurance sports such as triathlons. As soon as I was in a triathlon race, I was figuring out how to conserve my energy so that I could finish the race. My strength in cycling didn’t make-up for my swimming and running.
It’s the same in a start-up. You can’t think about endurance, the long-term or trying to do everything yourself. You have to focus your team on creating short-term success, like a hockey shift or a tennis rally or a hundred yard (meter) dash, in order to grow your business.
The critical success factor in start-up success is speed: attracting customers, generating sales, converting sales to positive cash flow, reinvesting in your business, achieving profitable growth. These are a series of sprints. If it feels like a marathon, something is wrong.
Can you see the finish line or are you climbing yet another hill with no end in sight?
Copyright 2012. Phil Symchych. All rights reserved.
Tags: Business Growth, business owner, business owners, Business Success For Life, business wealth accumulator, Cash flow, create your own wealth, Customer Service, entrepreneurs, leadership, Phil Symchych, Phil's Profit Points, profit, profitable growth, small business, small business consulting, small business growth, Start-up, Strategy, Symchych, Symco, Symco & Co.
Posted in Start-up | No Comments »
Wednesday, October 26th, 2011
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Tags: business, Business Growth, business owner, business owners, Business Success For Life, Coaching, competition, continual learning, entrepreneurs, how to improve profit, leadership, Life Balance, medium business, Phil Symchych, Phil's Profit Points, profit, profitable growth, small business, small business consulting, Strategy, Symchych, Symco, Symco & Co.
Posted in Phil's Profit Points, Podcast Series: Profit Points | No Comments »
Wednesday, October 19th, 2011
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Tags: business, Business Growth, business owner, business owners, Business Success For Life, Cash flow, continual learning, entrepreneurs, how to improve profit, leadership, marketing, medium business, Phil Symchych, Phil's Profit Points, profit, profitable growth, Sales, sales training, small business, small business consulting, Strategy, Symchych, Symco, Symco & Co.
Posted in Podcast Series: Profit Points | No Comments »
Friday, October 14th, 2011
A good friend was explaining the daily challenges of growing his business.
“Why does it feel like my face is in a fire hose?” he asked.
“Well, there are people running multi-billion dollar companies, with the same 24 hours in a day we have,” I replied, not sure if he was asking for advice or venting.
“Yes, and they have people they can delegate to,” was his response, and then he heard the wisdom of his own words.
“So, there’s your answer,” I suggested, realizing it was simple but not easy.
The key factors in growing your business are resources: time, people and money.
Money, which comes from profit, allows you to hire great talent, to whom you can delegate. The critical path starts with having a profitable business model. If your business isn’t as profitable as it could be or should be, then you need to evaluate your business model from the customer’s perspective.
How much value are you providing to your customers?
Another entrepreneur asked “when should I hire extra help around the house while I’m juggling parenting, running the house and building a business?” As soon as possible!
It comes down to the opportunity cost of our time. If we can delegate or outsource tasks that we don’t like, that we don’t need to do and that aren’t important to our roles and relationships, then we should do so. This applies to both our professional and personal lives.
What can you delegate, outsource or stop doing in order to create more capacity for important things in your life?
Copyright Phil Symchych 2011. All rights reserved.
Tags: Business Growth, business owner, business owners, Business Success For Life, entrepreneurs, Phil Symchych, profit, profitable growth, small business, Symchych, Symco, Symco & Co.
Posted in Life Balance | No Comments »
Wednesday, October 12th, 2011
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Tags: business, Business Growth, business owner, business owners, Business Success For Life, Cash flow, entrepreneurs, how to improve profit, leadership, medium business, Phil Symchych, Phil's Profit Points, profit, profitable growth, small business, small business consulting, Strategy, Symchych, Symco, Symco & Co.
Posted in Podcast Series: Profit Points | No Comments »
Monday, October 10th, 2011
I recently spoke to a business owner who wanted to maximize short-term profits and increase long-term capacity in the business. It’s very difficult, if not impossible, to do both at the same time because they are in conflict. However, I hear the question often, and here’s why: The person isn’t thinking clearly, they are thinking like the owner/manager.
The worst job in the world, in fact, is ‘Owner/Manager’ because the two roles are always in conflict with each other.
Are you the owner, trying to achieve a return on investment from what should be a passive investment?
Or, are you the manager, trying to maximize revenues, profits and growth while consuming resources and spending money on training, advertising and other things that may not have an immediate payback-things that reduce short-term returns desired by owners?
Are you in conflict with yourself?
Just imagine what your role looks like to your employees? Are we maximizing profits today by cutting expenses because the owner is worried about a dividend or are we building for the long-term by increasing expenses and investments?
To help you sort out your roles, here are questions to think about.
Questions for owners:
- What is my return on investment?
- What is my return on equity?
- How can I build equity in the company?
- How can I protect my equity?
- How can I position my investment for eventual sale?
Questions for managers:
- How do we make our customers happier, improve our competitive position and grow revenues?
- How do we beat our budget and forecast (you have one, right?)?
- How do we allocate resources to increase our capacity and speed?
- How do I attract and retain key talent, regardless of what the economy is doing?
- How do I develop my people to replace me so that I can move up in the organization?
If you’re thinking about your wealth, you’re thinking like an owner. If you’re thinking about growing the company, you’re probably thinking like a manager.
Which hat are you wearing? Which hat should you be wearing?
If you’re not sure, here’s my recommendation: “You’re fired!”
Fire yourself as manager, build a management team, and give the team your performance targets that will meet your ownership returns of investment and equity. Then, get out of the managers’ way.
Copyright Phil Symchych 2011. All rights reserved.
Tags: business owner, business owners, Business Success For Life, entrepreneurs, owner/manager in conflicting roles, Phil Symchych, profit, profitable growth, small business, small business consulting, small business leadership, small business management, small business owners, SME, Symchych, Symco, Symco & Co., the roles of owner/manager
Posted in Business Growth | No Comments »
Wednesday, October 5th, 2011
Podcast: Play in new window
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And now also on iTunes
Tags: business, Business Growth, business owner, business owners, Business Success For Life, Cash flow, contingency planning, entrepreneurs, how to improve profit, leadership, medium business, Phil Symchych, Phil's Profit Points, profit, profitable growth, small business, small business consulting, Strategy, Symchych, Symco, Symco & Co.
Posted in Podcast Series: Profit Points | No Comments »
