In spite of hiring a new coach a little over a couple of years ago (Coach Jeremy Pruitt) from the SEC King himself, Nick Saban, there came a time of refreshing and hope. Hey, maybe we would live up to our legacy of being in the top tier of SEC football and no longer being bottom feeders... at least I thought. After watching yesterday's beating and thinking about the why and how business's fail, something became crystal clear to me.
Jericho Business Advisors
Jericho Business Advisors provides value added consultation and advisory services for small businesses in the areas of sales, operations, management, accounting, and financing
Sunday, October 25, 2020
How the Tennessee - Alabama Game Proves that Management Failure is Business Failure
Thursday, October 1, 2020
How to Avoid Chaos as a Small Business Owner
After watching the Lakers completely destroy the Heat in Game 1 of the NBA Finals, I was laying in bed before dozing off thinking about some of the small business owners that I've worked with in the past and how I could see that there were two very distinct types of owners: doers and thinkers. Very rarely have I encountered individuals that can both do and think at high levels. Let me clean this up a bit because I don't profess to be a high functioning doer AND thinker myself. You let my wife tell you, she'd say all I do is think and don't DO ENOUGH. And yes, I'd agree with her for the most part.
Oddly, when we're coming up in age, the difference in being a doer and thinker impacts us in a sneaky way and before you know it, you're either labeled a doer or thinker but rarely both. In the arena of being a small business owner, you will often discover that you need to be both a doer and thinker or at least have the wherewithal to grow into these skill sets if you desire to have a business worth having.
Action With A Purpose
While playing college basketball, my coach would often tell me to practice 'at game speed'. I was like, what do you mean, Coach? It wasn't until after my playing days were over (and after 2 ruptured patella tendons!!!) that I realized the deeper meaning of Coach's encouragement: don't just practice just to practice, practice with a purpose!!! In other words, I failed to realize at the time that I was practicing with the purpose of doing my role to help the team achieve our short and long term goals. It wasn't only about me and the improvement of my game only, but ultimately it was about the bigger picture. Again, I've observed over the last 20 years how the small business owners that worked with a purpose, with a bigger picture mindset, were the ones that not only survived, but thrived.
When you first get into running a business, you have no choice but to be a doer. Things have to get done and usually, you as the owner are the only person available to do them. As your business grows though you'll begin noticing that you have to start thinking things through before just jumping in to do them. This is when strategy and planning become important (asking yourself, why am I doing what I'm doing and to what end am I doing it?) and the charge of getting things done soon follows.
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Wednesday, September 30, 2020
Fighting the Good Fight as a Small Business Owner
Last evening, I was looking up YouTube videos on "Top Business Ideas Post Pandemic" and I was able to find some great info... truly material content. I've had the privilege to work with small businesses in many industries over the last 20 years, and there's a certain kind of energy I get when working with small business owners to help improve and make their business better. Well, there's no shortage of helping small business owners during this pandemic because most are suffering in some way whether that's from a disruption in sales, the need for advice on financing, or maybe even being able to help provide some strategic consulting on both short and long term business plans.
During this time, though, I've been intrigued by the small business owner's 'WHY"... in terms of starting and operating the business in the first place. I'm sure there're a lot of small business owners that have pondered this question over the last few months. I wanted to write a quick post to help those individuals that are thinking about jumping into the small business ownership arena either willingly or even for those that have been forced due to the pandemic. I hope this guide helps in making this choice a thoughtful yet actionable one.
Know Your Why
First things first... you have to be clear on your "WHY". Before the pandemic, most of us were looking to jump into the small business ownership arena as an option rather than being the only choice you have to feeding your family, sustaining a certain way of life, or just plain ol' survival. In spite of these different reasons for starting a business, you still have to know your WHY. What do I mean? Simply, you must have a deeper purpose other than just saying I need more more or I want to buy a shiny, new toy such as a bigger home or luxury car. You have to tap into the deeper levels of yourself and implant a purpose that transcends both time such as operating a small business for not only the well being of my family, but for future generations once I'm worm food. Or maybe even founding a business to sustain the welfare of a family member or community that suffers from mental illness ailments that render these individuals unable to care for themselves and your business provides the resources necessary to take care of these individuals. Here's the lowdown: the purpose you have for starting an operating a small business has to be BIGGER THAN YOU!!!
Who Are You Serving?
What will keep you going once you realize that running a small business is really hard and time consuming? Or what keeps you motivated to keep pushing when you have a string of bad sales days or maybe even weeks to the point that you don't get paid let alone having to worry about paying your employees? Or how about this one: you have to have a hard conversation with your spouse or partner about not being able to make the mortgage or car payment this month because you weren't able to close enough sales or maybe even had to refund an irate customer that threatened suit because your product or service delivery did not meet their expectations? What's keeps you going during this moments of absolute horror and shame as a small business owner? Quite simply, the customer, client, member, etc. Remember, you didn't get into business to serve yourself. Now, you may have came up with your product or service because of a personal dissatisfaction, but ultimately your small business exists to serve others and to serve them well. Thus, when you do encounter a day , week, month, or hell, maybe even a year like this, get outside of your own selfishness and remember who you're serving and to what end (hint here... it has to be more than just a transaction where you do just enough to get the customer's $$$). For more insight on the selflessness of business, check out an article I wrote CLICK HERE.
What's the Solution?
Tuesday, April 28, 2020
How Small Business Owners Should Use a Profit and Loss Report - Gross Margins
I'm Making Sales, But I'm Not Making Any Money???
Let's Hit the Bull's Eye!!!
Gross margins quite simply let you know if you're making money over and above the cost of sales for the products and / or services that your small business markets and sales. Of course, this assumes that you've done a decent job in understanding the cost of sales for your small business. What is it that makes the gross margin section so important, though? This section of the profit and loss report earns its weight in gold when you apply a minimum standard for achievement based on industry or market norms. Here's what I mean. You don't want to shoot in the dark for setting a minimum standard for gross margins because there's no significant basis to it other than your 'wishful thinking' For example, if you're operating a restaurant, you should know on average that overall gross margins should fall no lower than 50% to 60%. From here, you can continue to get specific with various product and service offerings to really discover the gross margins for each and every offering that your small business provides. Now here come's the magic. Once you've experienced a period of operations and have a pretty good set of data to generate projections (no less than a month factoring in seasonality, if it pertains to your industry) in combination to the minimum standards based on industry or market norms, you can gain a pretty solid picture of the cash reserves you'll be able to generate for up to a month or two. Here's the other key observation of conducting this type of gross margin analysis: you'll understand that you're in control (aside from the macro market factors that you or anybody can't control) of DRIVING THE ACTIVITIES that will manifest the increase in cash reserves by MONITORING GROSS MARGINS. Don't you see it now? By taking an active approach to managing and monitoring the gross margin section of the profit and loss report, you are able to drive both the sales and cost of sales sections with a eagle's eye approach. Remember, the devil is always in the details my friend.I hope that this series on using a profit and loss report to help your small business become more profitable and sustainable has been more than helpful because we're pushing on to the next section, putting to use the information found in the operating expenses of the profit and loss report. Till then, stay tuned...
Sunday, April 26, 2020
How Small Business Owners Should Use a Profit and Loss Report - Cost of Sales
We Made A Sale... That's A Good Thing, Right?
What's All This Talk About Margin?
So, How Do You I Use the Cost of Sales Section to Operate My Business More Efficiently
Saturday, April 25, 2020
How Small Business Owners Should Use a Profit and Loss Report
Work Smarter... Not Harder
During my time in consulting with small businesses, I've observed that many very rarely use the information available to them by way of a profit and loss report. Often, these owners are too busy looking after employees or contractors; taking care of clients or customers; or taking time to produce products and / or services for delivery. Often, they are working just to survive. It's the American Way, right? An honest day's work for an honest day's pay. I still believe there's some merit to this blue collar working philosophy, but it largely fails to help the small business owner progress in achieving the ultimate goal of sustainable profits and growing cash reserves that are unrestricted. What's the one management tool needed to help these small business owners achieve these profits that lead to robust cash reserves? It's putting to use the information available in the profit and loss report to operate the business in the most efficient and focused manner possible But, how does one go about doing this?Nothing Happens Until a Sale is Made
Thursday, April 23, 2020
Why Profit and Loss Reports Are A Small Business Owners Best Tool In Running A Business
A little over six months ago, I attempted to record a webinar series called, 'Small Business Financial Literacy 101' and it was an epic fail. Don't get me wrong, I was rather encouraged that I had the wherewithal to discipline myself to screen record 3 videos and upload them to my LinkedIn page. Damn proud because I had been thinking about doing it for AT LEAST 2 YEARS. Yep... procrastination is a mother for sure. The reason I considered it an epic fail is that the response I expected did not happen.... and what response was that you ask? I wasn't looking to gain numerous likes or even shares; my aim was to connect to those small business owners that struggle to understand the operations of their business from a numbers perspective.