Every business owner will face a liminal dimension—a doorway—either by choice or by necessity. Most of us expect or experience the doorway of adversity as we work toward the doorway of prosperity, likely with the sale of our company. But be honest. Haven’t you ever said or thought, “If I win the lottery, I’d quit this business!”? (more…) A Tale of Two Winners: The Lottery or the Purpose Driven Life See more on: American Business Advisors Small Business Consulting Firm via Blogger A Tale of Two Winners: The Lottery or the Purpose Driven Life
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This week's post is co-authored by Kevin Condon, an associate of JHA. Please see his bio below.When one buys or sells a firm, there are a number of key questions to consider. The “science” relies on clear cut questions with quantifiable, or at least unambiguous, answers. The “art” relies on fundamental relational skills like building trust, discernment and cultural sensitivity. Will my practice be better if I add to or join this specific practice with these demographics, this “feel,” this style? The following blog post The Science of Great Business Marriage: Foundation (Part 1) is republished from www.abadvisors.com via Blogger The Science of Great Business Marriage: Foundation (Part 1) In This Edition...
Having trouble viewing? Download PDF version. Featured ArticleDo You Want Your Profits in the Industry Top 25%?Part I: 12 Reasons Businesses UnderperformDid you know that*: 1) The SBA defines a small business as an enterprise having fewer than 500 employees 2) There are almost 7 million small businesses with employees 3) Over 50% of the working population (120 million individuals) works in a small business 4) Small businesses have generated over 65% of the net new jobs since 1995 5) Approximately 543,000 new businesses get started each month (but more employer businesses shut down than start up each month) 6) 7 out of 10 new employer firms survive at least 2 years, half at least 5 years, a third at least 10 years and a quarter stay in business 15 years or more 1) 77% of the wealth in the America came from owning a private business. 2) 5.25 million of these 7 million businesses are under performing and missing out on a huge amount of wealth accumulation opportunity. * Forbes Magazine 12 reasons privately held companies are underperforming As we reported last month, if your business is not in the top 25% of your industry then your business is underperforming and missing an opportunity to accumulate significant wealth for improving your quality of life, your family life, retirement, and the ability to give back. Following are twelve reasons these companies are underperforming: 1) Small business owners spend 99% of their time working on how well they run the day-to-day operations and 1% of their time on planning the business. Whereas 50% of the profit comes from how well you run the business every day and 50% comes from how you engineer business strategies (see last month’s issue). In the same way you can engineer components of building materials to get different buildings, business principles and strategies can be engineered to get different outcomes. 2) Leading a business when it is growing from 10 to 100 employees is extremely difficult and the operating environment is very turbulent during this time. As you grow from 10 to 50 employees it becomes greater and 5 times more difficult to manage people, money, and capital. 3) Between 50 and 100 employees the company becomes an organism and requires an understanding of how to manage an organism not just how to manage individuals. 4) The owner may not be a good money manager. If a person can’t manage their personal finances well they won’t manage the business finances well. There are only two principles of finance that work: 1. Make more than you spend or 2. Spend less then you make. 5) When the business gets past about $1 million in revenue, the money can no longer be managed like personal money. Managing a business requires an understanding of finance and how to manage more complex assets such as accounts receivable, inventory, work-in-process, and property and equipment. 6) Between $1 and $10 million in revenue, components of the business have to be reengineered about every $2 million. There are 14 major components that drive the success of a business that are dynamic (continuously changing). Priorities have to be set to focus on the appropriate dynamics at the right time. 7) Business owners do not get appropriate advice on what to do with the profits at the end of the year. This is what we call surplus management and how you manage surplus has everything to do with how you increase profits and accumulate wealth. 8) There is no clear direction, business plan, and action plan to accomplish the owner’s goals and objectives. 9) Between $10 and $100 million in revenue or 100 to 500 employees formal competitive positioning and strategic planning is critical to make your company more powerful in your industry, outwit the competition, and withstand economic and industry changes. “If your business’s profit is not in the top 25% of your industry, by definition it is underperforming, 10) Operating and communication systems are not adequate to take them to the next level. 11) Financial and management reports are not adequate to take them to the next level. 12) The company does not know how to hire or afford the right people to get to the next level. Millions of business owners believe they are doing a good job running the business and they don’t recognize the business is underperforming. They don’t believe it is possible for them to get into the top 25 and/or they believe they can’t afford to address challenges to get there. In Part II, I will address How to Move Into the Top 25% of your industry. On Page 4 is a chart demonstrating it can be done. ABA NewsbreakOn March 1 American Business Advisors will be entering its 33rd year in business! Thank you to our current and past clients and the many professionals, friends and acquaintances that have contributed to our success. WE APPRECIATE YOUR TRUST IN US AND ARE VERY GRATEFUL!!! Sincerely,
“Millions of business owners believe they are doing a good job running Success StoryABA 2015 Profit Improvement Engagements ChartNote: Only clients listed where profit improvement was the focus [minti_table style="1"]
[/minti_table] *After paying ABA fees Click here to see other client success stories on our website. The Strategic Edge newsletter is published monthly by American Business Advisors to provide business and financial planning information and ideas. All material is presented to provide general and broad information only. The information found in this publication does not constitute business, tax, financial, or legal advice and should not be acted upon without seeking the counsel of a professional advisor. Comments and questions can be directed to Robert C. Benson at [email protected]. This email is never sent unsolicited and American Business Advisors keeps all our subscribers’ information strictly confidential. You have received this special offer by voluntarily providing your email information to us personally or at our web site. We respect your right to privacy. If you have any questions about our Privacy Policy or this email, feel free to call us directly at 303-335-4218. Subscribers’ personal information will not be shared, sold or rented. American Business Advisors, Inc.
Do You Want Your Profits in the Industry Top 25%? Read more on: http://www.abadvisors.com via Blogger Do You Want Your Profits in the Industry Top 25%? The Ironman Triathlon is aptly named. The competition consists these back-to-back events, in this order: a 2.4 mile swim, a 112 mile bike ride, and a marathon (26.2 miles). To participate in this triathlon is to test the limits of both one’s inner and outer motivation, purpose and identity. As a fan of Iron Man movies, I am similarly struck at how Iron Man’s arc reactor is an analog for both triathlons and business ownership. Billionaire engineer Tony Stark, aka Iron Man, was near death from shrapnel threatening to pierce his heart; he created the arc reactor to power an electromagnet to keep the shrapnel at bay. Business owners who have a sense of purpose (or a calling) also protect their hearts. If Iron Man can’t survive without the arc reactor keeping shrapnel from piercing his heart—how can you ;-)? (more…)Are You an Iron Man? Part 1 is courtesy of American Business Advisors of Denver via Blogger Are You an Iron Man? Part 1 Most businesses choose some form of incorporation whether it’s a LLC or a C-corporation. Each has individual advantages from legal and tax perspectives. What you may not know about is the untapped benefit of any form of incorporation. This benefit will help both you and your employees (more…) The article Your MVP: You, Inc. Find more on: American Business Advisors via Blogger Your MVP: You, Inc. American Business Advisors® (ABA) is delighted to announce the hiring of new Associate Sarah Guay for the American Business Advisors' Hawaii office, headed by Jon Hokama, Senior Vice President. American Business Advisors® (ABA) is the nation’s leading strategic and management consulting firm specializing in Building Cash Cows® and Improving Quality of Life® services for mid-size and small companies, family businesses, and their owners. Sarah Guay has joined the Hawaii office as Senior Advisor. Ms. Guay is passionate about aligning people development, strategy and purpose to drive outstanding business results. She has extensive experience empowering organizations to achieve maximum productivity through processes designed to attract, develop, motivate and retain engaged employees. Ms. Guay’s proven track record of success in strategic HR includes growing strong cultures that cultivate maximized productivity for Fortune 500 companies and several of Hawaii’s Best Places to Work (including ProService and American Savings Bank). Ms. Guay helps business owners clarify their strategic direction and align their people’s strengths with that strategic direction. She is a member of American Association of University Women, a past Board Member of Big Brothers Big Sisters Hawaii and is a regular speaker on women’s leadership and development circuit. She takes great satisfaction in helping others discover their passions, develop their talents and realize their potential. ABA Hawaii is delighted to have Ms. Guay as a resource to serve Hawaii’s business owners and their teams. For more information, email [email protected] or call 808-383-1766. TOOLKIT:SPECIAL OFFER for our "Insider" readers: What sets your company apart from the competition? ITR Economics is offering a new webinar, "Leveraging Your Competitive Advantage. " Date: Thursday, April 27th, 2017 at 2:00 pm - 3:00 pm EST Cost: $75 [ABA Insider readers: use the code ABA to get a $10 discount] Click here to visit and sign up for ITR Economics webinar This webinar will provide you the tools to differentiate yourself from the competition based on ITR's Business Cycle methodology.
American Business Advisors Announces New Hire for ABA Hawaii Office is republished from American Business Advisors of Denver via Blogger American Business Advisors Announces New Hire for ABA Hawaii Office Over the last two weeks, we’ve learned from the impact life purpose has in undergirding the lives of two “business” owners. This is the time of year when successful business owners are planning for 2015. It’s a great time to review how closely your own life purpose aligns with your business. But, could you imagine having a life purpose so compelling that you’d have a plan for the next 9,000 years? It would take a powerful purpose to do so! Allow me to share with you the story of one business owner who had the kind of purposefulness that built a little start-up into a worldwide brand over 250 years later. (more…) Planning for 2015? Check Out This 9,000-Year Purpose See more on: American Business Advisors in Denver via Blogger Planning for 2015? Check Out This 9,000-Year Purpose 360 Workshop Invitation was first published on http://www.abadvisors.com/ via Blogger 360 Workshop Invitation What is a BMD?My wife and have always been big on ceremony, on ways of marking significant events in our lives. Birthdays, anniversaries, and graduations, certainly. Add to that “Nazarite” vows, a vasectomy, and rites-of-passage for our daughters. So, when I learned about something called a BMD—a Business Maturity Date—I was intrigued. It is truly a rite of passage. While it is a date any business owner can pick, typically three to five years out, it marks a time the business will be creating both money AND time for the owner. Think of it as a graduation from business “high school.” Is the business fully mature? Certainly not: if you meet a fully “grown-up” business owner, please introduce me! Is there more the business can become?Absolutely. Like our 18 year-old high school graduates, our businesses can stand on their own (sort of), but they are also prone to moving violations, calls home to mom and dad for money and the like. How did you choose your BMD?Achieving my BMD of Sept. 21, 2013: a Q & A is available on American Business Advisors of Denver via Blogger Achieving my BMD of Sept. 21, 2013: a Q & A This week I’d like you to recall Hans Christian Andersen’s fairy tale, The Emperor’s New Clothes. This story has a lesson that every business owner needs to consider. The tale tells of two weavers who promise an emperor a new suit of clothes. But what makes this suit unusual is that it is invisible to those who are unfit for their positions, stupid, or incompetent. When the weavers complete his suit and pantomime putting it on him, the Emperor parades before his subjects in his new clothes. The nobility see nothing but play along with the charade, not wanting to be shown unfit for their position. The commoners say nothing because they don’t want to be found stupid. No one dares to say that he doesn't see any suit of clothes. At last a child cries out, "But he isn't wearing anything at all!" The shocked emperor regains his composure and continues to walk through the crowd as though nothing has changed. After hearing more than one executive speech, several of us would comment, “This emperor has no clothes.” But not wanting to appear disloyal (or lose our jobs), we feign a certain disingenuous level of support of the latest executive pronouncements. How might business owners not get caught in this trap? The blog post Leadership: Are You Letting Your Firm Be the Emperor Who Has No Clothes? is available on American Business Advisors via Blogger Leadership: Are You Letting Your Firm Be the Emperor Who Has No Clothes? |
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