Bolster Credibility with Investors–Avoid These Phrases in Your Business Plan
October 10, 2008
Remember Papa John’s commercial on TV with the slogan “Better Ingredients, Better Pizza”? Well its nothing more than puffery: general, non-provable, inane claims. The problem is puffery is not only acceptable it’s often expected. Phrases like "the biggest," "the best," "the cheapest," and so forth are so over used most people simply ignore them.
If you’re guilty of using puffery in your business plan, you risk filling your plan with circumstantial evidence and bold claims that won’t do a thing to market your business. These frivolous claims add nothing to help an investor decide whether your business venture is truly any different from the other ventures they are evaluating. To weed out general, non-provable, inane claims, you need a plain and simple puffery sensor. And, here it is: whenever you make a claim in your business plan ask yourself this question, “Will investors really believe this?”
Let’s take as an example a business plan for a car dealership that included these claims:
- “We’ve got the largest selection of Ford cars and trucks in the entire city.”
- "We’re the largest volume Ford dealer in the southwest.”
- “We sell more Fords than anyone else in the state.”
If You Build It, Investors Will Come
October 4, 2008
When you begin to write your business plan or a section within it, you probably ask yourself, “What should I talk about? What key points should I bring out that are important to potential investors?”
The best way to answer these questions is to put your business plan trial. That’s right. Think of your potential investors as the jury and you as the defense attorney. You must prove to the jury ? beyond a reasonable doubt ? why they should invest in your business plan. At stake is a life or death sentence for your business venture. Your job is to come up with all the evidence and present it in a way the jury believes you.
Yet, if you look at the way most business owners and entrepreneurs prepare their business plans, they build no case at all. Instead, they mindlessly throw information down on paper, most of which is the same stuff all of their competitors are saying, just to say they have a business plan.
The typical business plan doesn’t build a case
Selecting a Business Broker or Intermediary to Help You Sell Your Business
September 26, 2008
As crazy as it seems, some people spend more time choosing a coffee machine than they do selecting the business broker or intermediary that will sell their business. This can be a fatal mistake that can cost time, money, and sometimes the ability to sell the business at all.
How do you choose the right business broker or intermediary?
What follows is a list of questions to ask any intermediary when interviewing them. We also explain what to look for in the answers given.
No one is going to have every qualification listed. But the person you retain must be trustworthy, knowledgeable, experienced, organized, and compatible with you.
Questions to help you determine if the intermediary trustworthy:
Does the intermediary have written references? Can you call the references? References indicate a job well done. They indicate that the intermediary had the dedication to complete the transaction and provide follow-up. You should be able to call any reference given. Pick two or three to call and ask the following questions.
***Were you pleased with the results?
***Was the initial evaluation consistent with the sales price?
***Did the intermediary follow his plan?
Are You Ready to Sell Your Business
September 21, 2008
Make Sure You Understand Your Motivation for Selling
Are you thinking about selling your business?
This simple one-question quiz will help you to better understand your motivations behind this thought. A better understanding of your underlying motivations will help you make the right decision.
Select the answer closest to your actual reason for thinking about selling your business.
A. “I’m selling my business because of the money I will make on the sale”. B. “I’m just tired and it’s not fun anymore.” C. “I have too many irons in the fire and can’t keep up”. D. “I’m ready to retire from owning my business”.
A. “I’m selling my business because of the money I will make on the sale”.
This is rarely a good answer if it is the primary answer. Most small businesses sell for 1 to 3 times yearly cash flow after adding back all owner salary, benefits, fringes, interest and amortization/ depreciation.
Larger mid-sized businesses generally sell for to 3 to 7 times cash flow after deducting for the cost of executive management. While this sum can be significant, it is usually only a few times what you will make this year.
Meetings and Road Trips
September 14, 2008
Managing a meeting is like setting off on a long car trip with friends or family. You need to plan your route, pay attention to the rules of the road, consider what will keep your passengers engaged and occupied, and always remember you have to get back home at the end.
Just as adults and children consider car trips to be tolerable as the only way to get to certain places, so too do business people view meetings as necessary evils.
Here are three ways to make an enormous difference in your meetings.
1. KNOW WHERE YOU’RE GOING
Most of us wouldn’t start a trip through unfamiliar territory without looking at a map beforehand so we don’t get lost. Preparation may be just ten minutes, but a little preparation goes a long way toward making a meeting successful. You want your time to be productive and efficient. Whether your meeting is with a five-person project team, 100 worldwide sales people, or an online multi-location group, you need to consider a few key items ahead of time.
Vampire Meetings and How To Slay Them
September 6, 2008
Meetings can be like mythical vampires ? sucking the life out of intelligent and creative people. And sucking the funds out of businesses. Unfortunately, there are too many of these meetings in business today.
A UCLA study said the "typical" meeting includes nine people. If you have nine people in a meeting room for one hour, you have consumed one entire workday ? plus some.
What about the dollars associated with this? Say the average salary of meeting attendees is $40,000. Their hourly pay is about $20.00. Nine people for one hour costs $180.00. Not bad, right?
But consider the implications. People don’t spend just one hour a year in meetings. In a 3-M online survey in 1998, people reported spending between one and 1.5 days per week in meetings. They also said 25% to 50% of those meetings was wasted. Being conservative, let’s think 25% of one day’s worth of meetings?that’s two hours. Per week. Times nine people. 18 hours a week. Times $20.00 an hour. 18 times 20 times 48 weeks = $17,280.00.
Work Priorities: Where Can You Spend Your Time Most Effectively?
August 31, 2008
Understanding where you can spend time most effectively requires concentration in three areas:
1. Doing what you enjoy 2. Concentrating on your strengths 3. Understanding Job Excellence
Let’s start with doing what you enjoy. Your quality of life is in many ways dependant on how much (or little) you enjoy your job. While every job has aspects that you may not enjoy as much as others, overall your job satisfaction should be high. The higher your job enjoyment, the more effectively you will be in getting things done.
If you are working in a job that you don’t enjoy, you have two choices. The first is to minimize those things you don’t care for. This does not mean you no longer do them, but you look for the positive things about those individual components you don’t like. Over time you should be able to reduce the number of negatives and increase the positive aspects. This will automatically increase job enjoyment.
If you are certain you will never be able to enjoy your job, it’s time to consider option 2, changing jobs. This is a drastic measure and should not be done without careful thought. However studies continually show that people who do make a decision to change from jobs they don’t enjoy to jobs they like almost immediately experience a better life with less stress.
Cross Cultural Solutions for International Business
August 23, 2008
Globalisation, the expansion of intercontinental trade, technological advances and the increase in the number of companies dealing on the international stage have brought about a dramatic change in the frequency, context and means by which people from different cultural backgrounds interact.
Cross cultural solutions to international business demands are increasingly being viewed as a valid and necessary method in enhancing communication and interaction in and between companies, between companies and customers and between colleagues.
Cross cultural consultancies are involved in aiding companies to find solutions to the challenges cross cultural differences carry.
International and national businesses are ultimately the result of people. As with incompatible software, if people are running on different cultural coding, problems can occur. Cross cultural consultancies therefore concentrate their efforts on interpersonal communication.
Different cultures and cultural backgrounds between a highly diverse staff base brings with it obstacles, challenges and difficulties. Cross cultural differences manifest in general areas such as in behaviour, etiquette, norms, values, expressions, group mechanics and non-verbal communication. These cross cultural differences then follow on through to high level areas such as management styles, corporate culture, marketing, HR and PR.
Results of Poor Cross Cultural Awareness
August 17, 2008
Results of Poor Cross Cultural Awareness. Having a poor understanding of the influence of cross cultural differences in areas such as management, PR, advertising and negotiations can eventually lead to blunders that can have damaging consequences.
It is crucial for today’s business personnel to understand the impact of cross cultural differences on business, trade and internal company organisation. The success or failure of a company, venture, merger or acquisition is essentially in the hands of people. If these people are not cross culturally aware then misunderstandings, offence and a break down in communication can occur.
The need for greater cross cultural awareness is heightened in our global economies. Cross cultural differences in matters such as language, etiquette, non-verbal communication, norms and values can, do and will lead to cross cultural blunders.
To illustrate this we have provided a few examples of cross cultural blunders that could have been avoided with appropriate cross cultural awareness training:
An American oil rig supervisor in Indonesia shouted at an employee to take a boat to shore. Since it is no-one berates an Indonesian in public, a mob of outraged workers chased the supervisor with axes.
Writing and Revising Your Life Story
August 8, 2008
Change is not simple. Why do we repeat behavior that doesn’t work? Those actions that lead to stifling debt, disappointing careers, or stuck relationships? Then do it harder, yet expect a different result? Why is it not obvious that trying to exit an old story by simply writing a "better ending" only recreates the same story, and ensures that we remain in it? That a thousand better endings to an old story don’t create a new story? That the past cannot be changed and is a settled matter? That too often, we see ourselves as the victims of the stories that we author and the feelings we create?
We actively construct what we think, feel, and experience.
How surprised we are to learn that our fears are not in the dim shadows of the past’s unknown, but in the hopeful light of this moment’s change.
The only thing more difficult than changing and growing is not doing it. It is never too late to become what you might have been. Or too soon to become who you want to be.
