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Five Ways to Learn Business Management Skills

Many small business owners are experts in their business service or product - whether it’s bookkeeping, designing dog products, or delivering fitness programs. But they’re not experts at business management, and this lack is the reason for at least some of the large number of failures among small businesses.

So what can small business owners do to improve business management skills? Here are five of the most convenient ways to upgrade your skills and become more knowledgeable about managing your business.

Teleseminars -  There are dozens of free business teleseminars and webinars that you can sign up for. Become a continuous learner and in the space of just a few months you can learn valuable information that will be useful in your business.

Networking Events - Keep an eye on business networking events in your town which may feature guest speakers on a variety of business-related topics. These events can include business groups, presentations, workshops, and other gatherings. For the price of a lunch or dinner you can learn more about the featured speaker’s area of expertise. You may even land a new customer by networking with others who are attending the event.

Mastermind Group - Napoleon Hill, in “Think and Grow Rich”, described a Mastermind Group as “the coordination of knowledge and effort of two or more people, who work toward a definite purpose, in the spirit of harmony.” Working with other small business owners will help you uncover your existing management skills and learn new ones. You will build on your current level of knowledge and success through the magic of multiple heads creating something much bigger than any one individual.

Coaching - Hiring a business coach is another way to learn management skills, as well as to have someone to hold you accountable. You can develop your business quicker by working from your strengths (your product or service) and hiring people to help you with what you’re weak at (business management).

Night School -  If you’re committed to learning business management skills, your local school board or college may be of help. Many night schools offer small business education courses that teach entrepreneurs about the management side of their business. For the price of the course and a time investment, you can attend classes filled with other entrepreneurs, and learn from your classmates as well as your instructor. Some instructors will provide additional training as well.

These are some of the ways that you can work towards strengthening your business management skills.  Becoming more knowledgeable about managing your venture will greatly improve the chances that your business will succeed.

Business Plan Guide – 7 Mistakes to Avoid When Writing a Business Plan

A business plan guide is a great place to start when you are getting ready to start a new business venture. Perhaps you have found a book about writing business plans, or are following a template, but chances are, these materials will only focus on the steps necessary to create your written report and will fail to point out the critical mistakes that most new business owners make. So let’s ignore the step-by-step tutorial for a moment and focus on the real world mistakes you need to avoid.

1. Don’t Put it Off.

Yes, writing a business plan can be a monumental chore. It’s easy to procrastinate while you focus on the more exciting processes of your business. Many new business owners will wait until the day before their scheduled meeting with the bank — and then frantically try to write a plan overnight. You can imagine the results.

Don’t wait until you have more time. There will never be more time. You need to clear your calendar for a week and make your planning a top priority. Or if that isn’t feasible, schedule a certain period of time each day to work specifically on planning. No doubt you have heard the old saying: “If you fail to plan, you are planning to fail”.

2. Don’t Confuse Profit With Cash Flow.

Unless you have an accounting background, you are very likely to define the success of your business in terms of profits. A simple definition of Profit would be Sales minus Expenses equals Profit. But in the business world, profits do not equate to cash. Your profit formula does not take into account the amount of cash you have tied up in production costs for products that have not yet sold, or the customers who still owe you money for sales that have already been made. Your business can look quite “profitable” while your bank account is over-drawn.

In your written plan, make sure you include a table that addresses cash flow. Ideally, you should detail the monthly cash flow for the first two years of the business and annually thereafter.

3. Don’t Fall in Love With Your Idea. Too many business plans blabber on for pages about the “newness” and “uniqueness” of the idea. But the truth is, investors want to invest in people, not ideas. It is only the people who can execute the systems necessary to bring the idea to life.

Instead of waxing poetically about your business idea, focus your energy, and your reader’s eyes, on the ways you plan to implement this great business idea.

4. Don’t Succumb to Fear and Dread.

If you have never written a business plan, the process may loom like Mount Everest. But, like most new challenges, writing your plan isn’t as hard as you have imagined it to be. You aren’t writing a doctoral thesis or the next great novel. If you have invested in a business plan guide, use it. You can easily find helpful resources such as books, software programs and templates. Remember, you eat an elephant one bite at a time, so start chewing.

5. Don’t Over Sell.

Skip the vague and meaningless business phrases such as “best ever”, “highest quality” and “unsurpassed customer service”. You will lose your reader’s interest and respect if you engage in hyperbole that isn’t supported by measurable facts. Remember that the objective of a plan is its results, which require tracking and follow up. Focus your goals on specific dates, management responsibilities, budgets, and measurable milestones. Think fewer words and more numbers.

6. Don’t Engage in One-Size-Fits-All

Business plans can have many different purposes and they should be written to reflect the specific purpose at hand. You may be using your plan to start a business, or just run a business better. Your purpose may be simply to sell an idea for a new business to one particular business partner. Your plan may be intended to secure a small business loan, or it may be needed to secure millions of dollars of venture capital. Each of these purposes would require different information, presented in different ways to meet the needs of different readers. Keep a picture of your intended reader firmly in your mind and your business plan will stay focused as well.

7. Take Off the Rose Colored Glasses

Optimism is a wonderful resource. Without it, a business owner would find it difficult to summon the energy necessary to launch a new venture. However, this is not the time to engage in unbridled projections. If your company’s growth chart is based on an “industry average” of fifteen-percent annual growth, you should certainly be prepared to prove that assumption. Provide supporting data and, when in doubt, be less optimistic.

By using a good business plan guide, and avoiding these common mistakes, you can prepare a plan that almost guarantees your business success. Best of luck!

Is Bad Business Worse Than No Business For the Small Business Owner?

What do you mean by this strange statement? The meaning is that is it not better to turn business away than get into business dealings that are bad? On the face of it, surely some business is better than none at all? And what is meant by bad?

Bad business is business that costs you the small business owner more than it is worth. This could mean business that ends up costing you more financially than you expected to bring in on that transaction. If a job costs you more in materials, labor, time and money than the actual money you received for that job, then you have lost money on that job. Basically by taking on that work, you incurred more cost than the money you actually received.

Many times the small business owner takes on work that he does not feel comfortable about from the very outset. He has a bad feeling about the job. He may know that the job is pretty much borderline from a profit perspective. He may suspect that he will not receive payment or the customer has expectations that he knows will be tough to meet.

The small business owner should make every effort to ensure that whatever transaction is, the deal is planned to be profitable and the terms and conditions are made very clear and understood by all parties involved and everyone is happy with them. Naturally one cannot avoid bad business transactions from ever happening. Life is too unpredictable, to avoid all unfortunate events.

Although today we are all going through tough times, the idea that doing even bad business to keep busy is not a good one. Some may argue that although you may have lost money on a particular job, your name is still out on the street and although you lost money on the job, the advertising mileage through having done the job was worth taking the loss. Loss leaders to get other business are one strategy that large corporations do use to generate other profitable business. Generally they have pretty deep pockets to do this and they normally make up the loss by selling the same customer something else that is profitable. This can be a very expensive way of doing business, an expense that most small business owners cannot afford.

Often bad business comes out of a breakdown in the relationship between you, the small business owner and the customer. Somehow through a misunderstanding or an expectation that was not met, the deal goes bad. These types of situations are a lot more common than one realizes and often expensive lawsuits result from this. The time and money wasted through bad business makes it very obvious that no business is preferable to bad business. Bad business can be far more costly, time consuming and the bad publicity through word of mouth is just as bad for business.

With enough diligence on the part of the small business owner leaving no detail left to chance, and all parties being in full agreement, these unfortunate dealings can be minimized as much as possible.