KLC Newsletter

Biz Sense Media

Featured Articles

Newsletter: November 2009

So you want to be an Entrepreneur?
Six Key Considerations for Readiness

In this economy, many people are looking for jobs. Some are corporate refugees (either voluntary or involuntary) who are considering starting their own business. Challenging times can create great opportunities. If you are pondering entrepreneurialism, or are a new entrepreneur, one thing is clear: Know what you are getting into. We offer six key considerations for readiness in starting your business.

  1. A business plan which considers the following components:
    1. Description of the business/service
    2. Customers/Clients and Competition
      1. Who are your customers — the ones most likely to use your services
      2. What makes you believe they will buy your product or service
      3. Who are you competing against
        1. if there are no competitors or perhaps 1 or 2, you will get the question of whether there is a need for the service — so you need to be prepared with an answer
    3. Marketing strategy
      1. Challenges you will face
      2. Opportunities you see and anticipate
      3. Pricing strategy
      4. Preliminary pricing and margins
    4. Sales Strategy, Sales Plan, Results expected
    5. Management Team / Owners
      1. Who and roles/accountabilities
      2. A focus on the skills you have to make this work
      3. An understanding of the skills you do not have but need to make this work (i.e. collaborators, employees, accountant, lawyer, insurance broker)
    6. Funding Requirements
      1. How much money will you need to start the business
        1. Working capital requirements
      2. Sources and uses of funds
    7. Financial Projections
      1. Pro Forma Income Statement — funding sources will want to know when you will breakeven and what cash flow looks like after that — reason, they want to be sure they get their money back
      2. Balance Sheet and a Cash Flow statements — your accountant will help you with this
      3. It is important to understand what these statements are telling you. If you do not have the financial skills necessary to understand them and the implications, ask a trusted advisor (i.e. your accountant).
  2. It is very important to put together at least a Pro Forma Income Statement. Without this it will be very difficult to catch the attention of a funding source. You will also be entering into a business venture "financially blind", which is reckless behavior. Here's what it should include:
    1. Revenue — By revenue category (example, Dog Grooming Company)
      1. self wash
      2. products sold
      3. grooming services
      4. Other services — identify (you want to know the ways you can make money)
    2. Expenses
      1. Salaries
      2. Subcontractor payments
      3. Insurance
      4. Payroll taxes
      5. Rent
      6. Advertising and marketing
      7. Bank charges
      8. Communications (i.e. phone, fax, internet)
      9. Dues and subscriptions
      10. Interest payments
      11. Legal and accounting
      12. Licenses required (if any)
      13. Office and computer supplies
      14. Postage and delivery
      15. Repairs and maintenance
      16. Payroll and 401(k) — if you choose to use an outside service
      17. Taxes
      18. Utilities
      19. Other
    3. Net Profit — is the difference between Revenue and Expense
  3. If eligible, consider applying for 8A status — peruse http://www.fedaccess.com/8a-certification-de.htm
  4. Incorporate the business — an LLC should do it. Cost is in the neighborhood of $1,000. It is roughly $500 per year for state business licenses. This varies depending on the State in which you are incorporated.
  5. Lenders will want to see the above information — it's standard.
  6. Potential lending sources:
    1. Banks — they will want collateral (i.e. your house)
    2. SBA
    3. Family and friends
    4. Call
      1. The Economic Development Corporation or similar in your community and tell them what you are doing and ask for their help
        1. they may be able to identify funding sources and what you need to do / prepare to catch their attention
      2. SBA — call and see if / how they can help
      3. Check with your local University, many have an entrepreneurs program (although it may focus on high tech companies)
      4. SCORE

Becoming an entrepreneur is one of the most challenging and rewarding experiences we know. To be successful, and not stress-filled, requires thoughtful planning, honest assessment of your readiness and consistent action to move you forward. While the above list does not include all of the requirements, it is our best list to help you understand the requisites and the resources available to help you be successful — sooner than later. Why waste time as it is one of our precious and un-renewable resources?

Tony and Sara are now Certified in Hogan Assessment Systems — a premier online personality and job performance assessment system to help organizations hire high potential employees and develop current and future business leaders.
Hogan Assessment Systems
www.hoganassessments.com


Differentiating Yourself

Many people unknowingly practice self-sabotaging behaviors that deselects them in interviews or greatly limits their business growth. There are five common and subtle self-sabotaging behavioral characteristics, which in this competitive market with less good jobs available, employers are wising up to, and so should you.

Be aware of what NOT to do:

  1. Not providing value to another but expect value from them first and/or regularly
    • Asking for help finding a job, then not returning calls or emails once you're settled in
    • Not thanking others for their help and advice
    • Treating vendors poorly rather than as potential partners
  2. Being a jerk
    • Treating employees poorly (read: disrespectfully and negatively)
    • Treating customers poorly
    • Treating acquaintances poorly
    • Treating most people who you feel can't help you now poorly
  3. Not taking the time to build and maintain real (read: mutually beneficial) relationships
  4. Showing a feeling of entitlement — people should be reverential to you but you feel no obligation to be respectful in return
  5. Hubris, (read: egotistical and arrogant in style and behavior)

Start doing now:

  1. Understand that building meaningful relationships is important, now more than ever. Begin now by adopting this philosophy.
  2. Decide who it is important to stay in contact with and stay in contact with them. Make a list and reach out.
  3. When you get a new position, acknowledge everyone who helped you by sending a quick note thanking them (whether they were instrumental in helping you get that position or not). You called them for help and they returned your call
  4. If someone you reached out to in the past calls or emails you — return the call or email. You do not have to be their best friend, nor even meet with them, but a gracious reply is remembered
  5. Always find a way to provide value first—simply ask and act on, how can I add value and improve this situation?

Challenging times can create great opportunities. One clear opportunity is to differentiate yourself using the recommendations we provided above. Someone will get the job. Why shouldn't it be you?

New Resources & Media

We've earned Expert Author status on Ezine! "Maximizing Healthcare Department Performance" — EzineArticles.com: http://EzineArticles.com/?id=3169227

Along with 15 other world class consultants, we recently completed the Million Dollar Consulting® Grad School with Dr. Alan Weiss.

Our article, Hiring for Fast-Growing Departments or Companies, originally published on ERE (http://www.ere.net/2009/09/11/hiring-for-fast-growing-departments-or-companies/) was retweeted 24 times and republished in Canada, the UK, and Japan. Read our newest article published on ERE, "Internal Talent Integration", by clicking here: http://www.ere.net/2009/11/15/internal-talent-integration/

Hogan Assessment Systems
We are HOGAN certified, a premier assessment tool for selection and development of high potential talent and emerging leaders.
Insight Health Solutions
Need an executive dashboard? Click on: http://www.insighthealthsolutions.com/