Tag: start up business

Do you Have an Exit Strategy?

What's your business exit strategy?As an entrepreneur, you had to create a business plan for your business when you started up. It included an executive summary, financials, marketing plan and some forecasting. But how far into the future did you go? 1 year? 5 years? 10 years?

A question you need to ask yourself — and many business owners overlook this — is What’s Your Exit Strategy?

  • How long are YOU planning to run your business?
  • When do you see yourself exiting the business?
  • What happens when you retire or can no longer run it?
  • Does it go to your children? Would they want it?
  • Are you going to sell it?

In this video from Lynda.com, author David Crenshaw explains some of the options you have. Watch it, then look at your options below…..


This probably got you thinking and you have more questions than answers. So, attend…

The Integration of Financial Planning with Business Management for the Entrepreneur

Thursday, October 15, 2015, 1-4 pm at Greater Phoenix SCORE. $25. Click here to register and for details.

If you need a business coach, a Greater Phoenix SCORE mentor can help you for free! Click here to schedule an appointment.

Who Needs A Business Plan?

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Do You Want 60% More Revenue in Your New Business? Join a Franchise System

Then Join a Franchise System

Do You Want 60% More Revenue in Your New Business?Some prospective business owners may ask, “Why should I invest in a franchise business when I can open my own independent business in the same industry?” The implication is that the first time business owner can do just as good a job opening their independent business as the franchise system does in opening its new outlets. And, since an independent business doesn’t pay royalties the novice independent business owner will put more money in their own pocket.

If we check the data, this turns out not to be true in almost all cases. Actual data shows that in those industries in which franchise systems operate, franchised establishments produce 60% more revenue than independent establishments. Do you want 60% more revenue in your new business?

There are many, many factors that work together to give these results. Let’s look at just two of these factors today. Franchised business establishments end up hiring about 30% more employees than independent business establishments. More importantly, each of the franchise employees produces about 24% more revenue per employee than employees of independent business establishments. These two factors multiplied together (1.30 employees x 1.24 revenue/employee = 1.60 revenue) gives the 60% higher revenue.

The franchise employees are more productive than the independent business employees. Again, there are many, many factors that work together to make this so. Among them typically are better recruiting programs, better training programs, better operating systems and economies of scale.

But does all this put more money in the first time business owner’s pocket?

That is the key question. In addition to franchise businesses having higher revenue they also tend to have lower expenses expressed as a percentage of revenue. One of the biggest expense line items in many industries is labor. Labor is frequently expressed as a percentage of revenue in a profit and loss statement.

Since franchised business have more productive employees their cost of labor expressed as a percentage of revenue is much lower than independent businesses. For those who like math, a 24% increase in revenue per employee translates to a 19% reduction in cost of labor as a percentage of revenue. Would you like a 19% labor reduction to go with your 60% higher revenue? And, would you like an apple pie to go with your cheeseburger?

A well-run franchise system will help reduce the cost of every other line item expense on the P & L Statement as well.

As a percentage of revenue, the franchised establishment will have lower cost of goods, lower overhead cost, lower selling, general & administrative (SG & A) costs, lower cost of debt service (assuming a first time independent business owner can even get financing) than the independent business owner trying to compete with them.

These are some of the reasons why astute business owners choose to wisely invest in a well-run franchise system. With higher revenue and lower costs, after paying a royalty, they end up with more money in their own pocket.

Not sure what type of business you should start? A SCORE mentor can help you with this. Schedule a free mentoring session here.

About the Author:

Kent Craven with FranNetKent Craven is the longest tenured office owner in FranNet. FranNet has worked with SCORE Chapters nationwide since 1987 to help educate prospective business owners about franchising. Contact him at www.frannet.com/kcraven or by phone at 602-224-9333 ext. – 2.

 

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The Perfect Pitch for Startups [Infographic]

You only have one chance to make a first impression!

Start-upThat still holds true for everything even more so for when you’re pitching your fabulous business idea to potential investors – if you’re looking to go the crowdfunding route. The infographic below gives a step-by-step outline for creating your slide presentation and the whole pitch.

  1. Use quality graphics
  2. Explain your business is 10 words / 30 seconds
  3. Explain the opportunity – what problem are you solving
  4. What makes you unique?
  5. Time to do a demo in less than 10 minutes
  6. How will you achieve critical mass?
  7. What makes you different from the competition? Do you even have competition?
  8. What’s your business model?
  9. Show them the money! Forecast.
  10. Who’s involved?
  11. Final – current status, what’s next?

Need to run the pitch by someone who’s been there? Need help coming up with forecast numbers or any of the other elements of the pitch?

A Greater Phoenix SCORE mentor can help you for free! Click here to schedule your meeting at various places in the Phoenix Valley.

The Perfect Pitch for Startups

 

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SCORE Success Story: AZ Social Media Wiz

I have a unique relationship with Greater Phoenix SCORE. I am a volunteer as I manage their social media and teach a workshop at least once a month. I’m also a vendor – they pay me monthly to manage this very blog site and to send out the weekly email newsletter and email promotions for their seminars. But I wouldn’t be where I am today, with out the free mentoring. And since I spend so much time there, I get to pick their brains every whenever I have a question.

I’ve been doing Internet marketing in one form or another since 1995. I moved to Phoenix 10 years ago and was working in various sales and marketing jobs till September 2008 when I got laid off. I was unemployed for 2 years. When I lost my job, I started a blog, “Internet Marketing Tips” and became active on LinkedIn. Those two efforts got me a job doing online marketing and events for a financial planner. I got laid off after a year and I saw it as a blessing in disguise. Having learned all about blogging and social media marketing on-the-job, I gave a presentation on blogging and Twitter for a group of writers and I saw that there was a huge opportunity training small business owners, over 40, on how to use social media marketing to promote themselves.

SCORE Success Story: AZ Social Media WizHence, I took the leap of faith and started AZ Social Media Wiz, providing 1:1 training, set-ups, strategic plans and implementation. I went first to the AZ Small Business Development Council (AZSBDC) (a sister organization to SCORE) to get help with my business plan.

I first encountered SCORE at a NetworkingPhoenix.com event and asked them, “who do I need to talk to about holding classes for SCORE.” That started it. My first class was a joint seminar with SCORE and the Ahwatukee Chamber of Commerce.

I was about 3 months into my start-up when I attended the free SCORE’s ABCs of Starting a New Business at the Phoenix Public Library that they present every first Saturday. (You can see their schedule here.)

A few months later, I was contacted by Scott Schreiber, now retired, about writing a couple of blog posts a month. In the summer of 2013, Scott asked me to help promote their upcoming Symposium on social media. I informed him that you can’t just start doing social media and stop after an event. People will think you fell of the face of the earth. It’s an on-going effort. That’s how I became a volunteer managing their social media. (My post, “11 LinkedIn Reputation Killers“, is the most popular post in their blog!)

Besides doing the 1:1 training and providing the social media services, I thought of recording training videos and offering them online. The challenge is that social media changes constantly and as soon as something is published — book or video — it’s obsolete. The other challenge was taking the time to record the videos. I remodeled my business plan in attempts to get some funding so I can take 3 months off to record the videos. I met with several SCORE mentors, Rod Houston, Andy Beran regarding my “pitch” for an Indigogo crowdfunding campaign and I also picked the brain of Tom FitzSimons when I thought of bringing on a business partner.

My problem – no collateral and lousy credit history. Crowdfunding didn’t work for me.

I ditched the video idea and decided to hold more local classes for the Phoenix-area entrepreneurs. I searched for the right space, rented a room at a computer school for a while, but I felt the best way to go was to find my own retail space. Problem came back to: no funding.

At the annual SCORE volunteer appreciation dinner, I sat next to Mike Levy. Not wanting to miss the opportunity of picking his brain, I started, “I’ve been growing my business with just the income – no funding or investors.”

SCORE Success Story: AZ Social Media Wiz“You’ve been bootstrapping,” he said.

“Yes, I want to open a training center in a retail location, but I have to buy tables, chairs and equipment. Any ideas?”

He said, “Try ACCION. They’re here in the Southwest and they help minority business owners with loans – and you cover 2 minority – Hispanic woman.”

I ran with it. The next day, I applied and I got an $8,000 loan. The SCORE dinner was a Wednesday night, the money was in my bank account Friday. Wow!

July 28, 2015, I signed a lease for a 1250 sq. ft. space in North Phoenix and opened the AZ Social Media Wiz Training Center. It’s a dream come true!

If you’re a business, no matter what stage you’re in: just thinking about it, starting-up, growing or established, you can benefit from either the free mentoring sessions and/or the local workshops and even online webinars! They also have free templates and tools to help you put together your business and marketing plans, budget, financial statements, etc.

Thank you, SCORE for all your continued help! Oh, and you’ll all get an invite to the grand opening!

Giselle Aguiar
Owner, AZ Social Media Wiz

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SCORE Success Story: Heartsweet Cakes

Heartsweet Cakes, a SCORE Success Story“When starting your business, you are going to need a plan A, B, C, and D,” said my SCORE mentor Roger Robinson, at one of our first meetings together. I left this meeting frustrated and discouraged because I only had a plan A.

Upon graduating college with a degree in business, I moved to Chicago and began working downtown at a marketing research firm, working only the left side of my brain in a cubicle for three years. From day one, I yearned for something more. I knew I wanted a career that I was passionate about and fulfilling. I went back to my love of art and design and began searching for cake decorating programs at culinary schools. I enrolled at the prestigious French Pastry School and I never looked back.

A couple of internships later, I worked my way up and managed the top cake shop in the city. I honed my skills and learned as much as I could about the industry and cake design. It was at this shop where my vision and dream for Heartsweet Cakes began to take shape. I drafted a 40-page business plan, complete with a 600+ item inventory list with prices and suppliers, and I estimated all of my start-up costs.

I moved to Arizona with a plan, a single plan, a plan A. I knew what I wanted my business to become and I was confident that I had the skills and talent to achieve it, but I reached a point in the process where I needed some help. Specifically, I was looking for advice in finding a commercial property and financing support/advice. I reached out to the local SCORE office in Phoenix and both Roger Robinson and Bill Robinson were assigned as my mentors.

Haley Cairns of HeartSweet Cakes - a SCORE Success StoryOnce Roger and Bill had a chance to review my business plan, we dove into some in-depth discussions and analysis of my financials. This was when my plan A started to seem like something that may be too risky financially. They asked me, “Is there a less risky way to start your business but still produce the same product to the same client market?” The answer was “yes”, and I truly feel like they both guided me into a less risky start of my company.  I decided to begin my business out of my home and I installed all of my commercial equipment into a spare room with a separate entrance. I am able to produce the same quality product that my clientele expects from me with less overhead and minimal construction costs. I was able to invest my startup capital into my branding, website, high-quality equipment and materials. I now have room to steadily grow my business with less pressure and financial risk and I will have a lot more control over my work-life balance.

I owe a big thank you to SCORE and the mentors that devoted their time, knowledge, advice, and support to me with my journey of making Heartsweet Cakes a reality. I believed that I could start my business with my plan A but, along the way, I was guided into a plan B, which was the smarter way to achieve my dream and I can attribute this to my experience with SCORE. Thank you to my mentors, Roger and Bill, and all of the other SCORE mentors who support entrepreneurs like me, who are willing to work hard to turn their dreams into a reality.

Haley Cairns
Owner of Heartsweet Cakes – Phoenix, AZ

You can be a SCORE success story! Get free business mentoring no matter where you are in your business: thinking of starting, start-up, growing or established. Click here to schedule a mentoring session with a mentor in one of our many Phoenix Valley locations.

Are you a SCORE Success? We’d love to feature you here in our blog and in our newsletter! Contact your SCORE mentor or the SCORE office with your story.

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Smart Goals – Recipe for Success

Smart Goals - Recipe for SuccssA company’s vision and mission are broad and far reaching statements about business objectives and what you want the business to look like in the future. They can seem overwhelming and difficult to achieve. Think about answering the question, “how do you eat an elephant?”.   The answer is “one bite at a time.”

Developing, prioritizing, and writing specific goals are key to successful business startups, continuous improvement and success of existing businesses. The idea is to capture the stepping stones essential to business achievement. Goals create the road map, the bite size pieces that make the vision and mission a reality.

The best goals are “SMART” goals. They are Specific, Measurable, Attainable, Relevant, Timely.SMART Goals - Recipe for Success

The best goals:

  • Address the most important and urgent issues first.
  • Contribute to using time wisely.
  • Provide a management tool to measure employee performance.
  • Help us overcome distractions and procrastination.
  • Increase productivity.
  • Provide motivation and positive feedback as the goals are achieved.
  • Are key to maintaining enthusiasm and continued progress.

Measure your goal setting IQ by answering these questions:

  • Does your business have a written operational plan?
  • Do individual business owners and employees have individual goals for the year?
  • Does the business owner meet regularly with the team and individual employees to review goal progress and re-set goals, if necessary?
  • Are business goals set by all the key people, not just the owner?
  • Are goal successes celebrated and rewarded?

It is clear that business success is greatly enhanced by creating a culture of developing and writing specific, measurable goals.

A SCORE mentor can help you with your goal setting. Click here to schedule a free mentoring session in a Phoenix Valley location near you!

About the Author:

George Obst, Certified SCORE MentorGeorge Obst is a Certified SCORE mentor with more than 30 years experience profitably managing and growing businesses, including start-ups, purchasing, financing and selling businesses.

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