Tag Archive for 'small business planning'

What the Tour de France and small business have in common

With 21 stages ridden over 23 days-some almost 150 miles long-navigating cobblestones, assaulting at least two mountain ranges and dealing with thousands of over-enthusiastic crowds, the Tour de France bicycle race is arguably the most grueling of all sporting competitions.

Here are four reasons why competing in the Tour is like running a small business.

1. Team structure
Tour participants are part of 22 sponsored teams of about 25 members, and each have individual roles to play. Some members are supportive non-riders and some are riders whose primary role is to protect and push their leader. But all work together to meet team performance goals, including getting their leader on the podium at the end of the day or the end of the race. Sounds a lot like a small business, doesn’t it?

Since every day in a small business can be like a mountain stage on the Tour-peaks and valleys-success requires the ability to motivate your team to work together effectively. A smart leader knows that sustaining successful teamwork requires sharing the recognition so the team doesn’t mind if you’re the one on the podium.

2. Communication
Competing in the Tour is like running 21 marathons in 23 days while simultaneously playing a chess match. So each team member has to understand his role in the overall strategy.

Even if you have the best business strategy in the world it must be communicated to your small business team so every member understands their role in the organization’s plan to achieve success.

3. Preparation
All you have to do is watch a Tour de France cyclist in a mountain stage to see successful preparation. These guys have turned their bodies into human spring steel as they become one with their bikes.

The small business equivalent is to learn as much as you can about operating your business, your industry, the competition, and especially, your customers. Since your team also needs to know these things, prepare them by investing in training and practice.

4. Technology
Tour de France teams certainly leverage technology, including high-tech bikes, customized chase vehicles, on-course communication tools, etc.

One of the keys to success for small businesses in the 21st century is leveraging technology.  If you want to stand in the winner’s circle you MUST find ways to use technology to make existing systems more efficient as well as help you take advantage of new opportunities.

Write this on a rock … Small businesses can learn a lot from the Tour de France teams.

Success is not measured only by money and stuff

Believe it or not, much of the potential for success in your small business depends upon two things:

1.  Your ability to effectively function physically, mentally, and emotionally.

2.  How well you balance where the business stops and your personal life starts.

"The best way to be successful AND happy is to be able to define success in many ways, including having a life that’s balanced with richness outside of the business."There actually are times when being one with your business is not only a good thing, it’s essential. But extreme commitment weaves a fine seam between business and owner. And unfortunately, entrepreneurial single-mindedness will often result in the opposite of what is intended: a business in jeopardy run by an unhappy human.

The best way to be successful AND happy is to be able to define success in many ways, including having a life that’s balanced with richness outside of the business. Getting that new customer on board is an essential part of your business’s future. But making the time to attend a child’s activity in the middle of the day is also important to the long-term well-being of your business.

A small business is more like a patchwork quilt than a gilded security blanket. Some patches represent good things and some not so good. Some patches are about the business, others are about the owner, and some are hard to tell. Happiness will be found by those owners who can feel successful regardless of which patch is in front of them.

Having multiple touchstones of success, not just money and stuff, helps keep the rough patches in business and life in proper perspective. If you became a small business owner to find financial success, good for you; as a capitalist I admire that motivation. But if you think being rich will make you happy get your umbrella out, because I’m going to rain on that parade with these two truths:

1.  Wealth only provides options, not a guarantee of happiness.

2.  If you can’t be happy without money and stuff, you aren’t likely to be happy with it.

Now let’s talk about fun.

The most successful business owners I know are those who have learned that one of the keys to their success is to run a tight ship while encouraging their people to laugh and find joy in their work. Every day that goes by without some kind of joy is a precious opportunity lost.

Two final thoughts:

1.      Think of happiness as a business best practice and a success fundamental.

Write this on a rock —

Learn how to define success in more ways than just money and stuff. And don’t forget to have fun.

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Jim Blasingame is the author of the new book, “The Age of the Customer: Prepare for the Moment of Relevance.”

How to know when to change your business’ DNA

In nature, all life comes in two forms: plant and animal.

In the marketplace, all business entities are found in two forms: human and non-human.  But unlike plants and animals, a human business can morph into a non-human entity.

The human businesses are sole proprietorships and partnerships. Of the non-human entities, there are three: C Corporation, S Corporation and the Limited Liability Company (LLC).

So why should your human business morph to non-human?

There are three excellent reasons:

1.  To acquire certain tax advantages. Talk with your accountant about this.

2.  The “corporate veil” provided by a corporation or LLC can shield personal assets from legal obligations or claims on the business. Talk with your attorney about this.

3.  Many larger customer prospects won’t take your business seriously as a vendor unless you are a corporation or LLC.

When should you morph? If your business is very small, you might be able to spend the incorporating expense—$500 to $1,000—on something more immediately critical, like a computer or marketing. But one concern is that you might wait until it’s too late.

Here are three organizational and operating triggers that should help you decide when to morph from a human to a non-human entity.

- When you hire the first employee.

- When you enter into contracts on behalf of the business.

- When you establish any credit, including with vendors.

Non-human entities do require maintenance to be able to sustain the benefits against outside interests. Here are a few critical maintenance tips:

- Tell EVERYONE that your business is formed as a non-human entity.

- Identify the legal ownership designation (like Inc., or LLC) on all documents, signage, etc.

- Operate the legal entity’s finances completely separate from personal activity, especially checking accounts.

- Maintain proper corporate documentation, like shareholder and annual meeting minutes.

Remember that corporate veil? Think of it as you do your roof: Maintaining both will protect you from dangerous things that fall from the sky, like hail and attorneys.

And finally:

-  Don’t forget the triggers.

-  Be proactive, not reactive, about your entity.

-  Keep up the maintenance on your non-human entity.

-  Business entity laws vary by state.

Write this on a rock … Your business is not a plant; you can change its DNA.

Tim Berry’s Top 10 reasons small business start-ups fail

In 1998, the SBA reported that 50% of small businesses fail in the first five years. That wasn’t good news but, sadly, it got worse. By 2008, the mortality of small businesses actually increased by 20% when it was reported that 50% of small businesses were now failing in the first FOUR years.

There are as many reasons why a business fails as there are business failures, but over the years it has become clear that all of those micro-reasons can be conveyed up into a smaller number of macro-reasons, including being under-capitalized, bad management, bad idea, failure to plan, etc.

Recently, on my small business radio program, The Small Business Advocate Show, I talked with someone who knows a lot about why some small business fail and why some succeed. Tim Berry is the founder of Palo Alto Software, the publisher of Business Plan Pro, the #1-rated software for developing a business plan and the author of two great books on business planning, The Plan as You go Business Plan and the business planning bible, Hurdle: The Book of Business Planning.  Tim is also one of the founding members of my Brain Trust.

Take a few minutes to listen to our conversation on why businesses fail so you can avoid making these mistakes and land in the survive and succeed category. And, as always, leave your own story and/or comments. Listen Live! Download, Too!




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