Tuesday, February 28, 2017

Structuring your Partnership

One of the most common entity structures in Washington State is a Limited Liability Company (LLC). As a business advisor we work with some startup businesses just forming their entity.  In these cases we can give them some guidance as to the type of issues they should consider and questions they should ask their partner when forming their entity and a list of business attorneys who they can consult to help draft the LLC agreement.  Other times, and far too often, we work with businesses in turmoil. In these situations it’s common that there are partnership issues at the root.

When the entity is formed everyone is friendly, on the same page, excited about the new business and ready to work hard.  Then business and life happen and somewhere along the lines things are not as rosy anymore.  One partner is burning the midnight oil while the other is leaving at noon on Fridays to play golf.  Commonly one partner thinks they are carrying all the load. Other times the entity was structured as a 50/50 partnership and there was never any consideration on decision making, roles and responsibilities or how to deal with a disagreement and how to exit the partnership is needed.

Many times a partnership will eventually work itself out, but only after much stress and expense for all parties involved.  Businesses close because of the inability to reach common agreement. 

Recently we came across an article written by Dick Bartram of HenkeBartram PLLC.  In this article he addresses some mistakes commonly made when forming or joining an LLC.  Please spend a few minutes and review his article.  Hopefully you are reading this in time to save yourself and your partners significant heartache.

Company Counsel by Dick Bartram

Written by Rich Shockley, CBA, CGBP

Monday, November 14, 2016

How to Wrap Up Your Year for Small Businesses

As we approach the end of the year, it is time to take stock of what we've accomplished and of what we need to do in the coming year to reach our goals. Here is a quick Top Ten List of things you should be evaluating:

  1. Walk in your front door as a customer. See through their eyes, as if you've never been there before. Does your store/office/warehouse seem orderly? Is it clean, inviting, and safe?  Now is the time to take inventory of anything that may need replacing and put it in the budget!
  2. Look over your marketing plan from this past year. Did you run all of the campaigns you intended to? Why or why not? Can any of them be salvaged or reworked? Take a look at the upcoming year and begin to plan your outreach. Need help? See your Advisor.
  3. Take a look at the price trending for your Cost of Goods Sold.  Do the costs seem reasonable? Are you getting discounts for buying in bulk, and if so, are you accounting for storage costs and waste? It may be time to renegotiate with your major suppliers, and it is definitely time to express your thanks. Having a good relationship with your vendors is key.
  4. How does your pricing compare with the market? Are your competitors offering anything that you aren't but should be? When pricing your products and services, be sure to keep your profit margins where they need to be and compete on quality, reliability, and timeliness rather than price alone.
  5. Take a look at your lease rate as a percentage of your gross revenue.  Even if you are locked in, being aware of this is important as it is typically one of the larger expenses. If you had to move, where would you go? Always keep alternate locations in mind.
  6. Measure your employee satisfaction rating. There are many free tools to do an anonymous survey or questionnaire. Your staff can be the most valuable part of your operations, so it's important to keep the lines of communication open. Schedule regular performance evaluations to make sure that they feel their voices are heard.
  7. Re-visit your job descriptions, employee handbook, and company policies. Has anything changed that needs to be updated? Is everyone clear on their responsibilities? Do you have processes in place to deal with violations? If you're unsure of what to do, there are many free resources available online for Human Resource questions.
  8. Check with your accountant about any changes to the law regarding employees, taxes, minimum wage, etc. that could affect your bottom line. Also check with regards to their fees or payroll service fees. Will there be increases in the coming year that you need to plan for? Little things can add up quickly.
  9. Stay involved in your community so you can be aware of any changes to zoning regulations, utility rates, transportation issues, or city events that could be good marketing opportunities. If you aren't networking with your Chamber of Commerce, service club (Lions, Kiwanis, Rotary) or Business Networking groups, you should consider this an investment of your time and money that could make a big difference to your company's reputation and brand.
  10. Have you taken a vacation?  Entrepreneurs are chronically overworked! Keeping the work-life balance is imperative to a healthy and prosperous business.  Be sure to schedule some down-time and consider a retreat to give you time to plan your coming year. If you need help setting goals, seek out an advisor or mentor that will help hold you accountable.
There are so many considerations to running a small business, it can be overwhelming.  At year-end it is important to take stock in what you did well, what you can do better, and whether or not you are heading in the direction you planned.  If you haven't set concrete goals, you can't reach them. "If you fail to plan, you plan to fail". Let us help you with your dreams for the coming year. Contact us at sbdc@highline.edu.

Thursday, September 15, 2016

How to Market to Actually Make Money

I was recently honored to speak at the Federal Way Library's Small Business Workshop series, and I wanted to share portions of my presentation and some of the great questions and answers with you.

The entire presentation slide deck can be accessed here:

One of the things I've discovered in speaking  with my clients re: marketing is that they often fall into the trap of buying marketing and promotional materials without looking closely at WHO it is that they are trying to attract, WHERE is the best place to reach them, WHAT it is exactly that they are trying to sell or promote, HOW to best reach them (through which media), WHEN is the ideal time to schedule their promotion or contact, and, most importantly - WHY they are marketing in the first place!

There are many free or low cost resources out there that should be your first go-to when you are a small business with a limited marketing budget. I will cover many of them here, but remember that you can always make an appointment with an SBDC advisor to go over your specific situation.

WHO - Whenever we begin a marketing campaign, knowing who you are trying to reach is paramount.  Unlike the past, when we had to blanket-market to everyone, we are now able to target a specific audience to make better use of our time and money.  Creating a customer Avatar is a great exercise to help you understand your ideal prospect. You should include their age, gender, interests, affiliations, profession, education, and buying behavior.  Both Facebook and Google have great ad tools to help you market directly to your ideal customer once you have defined them.

WHERE:  Do you want to reach your customers at their home, place of business, online, via mobile, or all of the above?  Understanding where they will be most likely to notice your marketing is crucial. For example, if you own a landscaping business, it may be that lawn signs would be more effective than flyers.  If you are a graphic designer, an online presence will better showcase your work than a door-hanger.  If you are selling personal products, you may not have much luck marketing in the workplace, etc.

WHAT:  Are you marketing to expand your brand presence, to drive customers to your website, to increase engagement? Or are you promoting a specific event or new product? Your efforts will be more effective if you are clear on the goal of your campaign.  One example of how this can backfire is if you are giving a special promotion or discount to your new customers and it reaches your existing customers. They will not be happy.  Having distinct campaigns that are designed to reach only certain audiences can eliminate this predicament.

HOW:  Each campaign should have its own media platform(s) and this will depend on the WHY of your campaign.  Want to increase traffic to your website?  Google My Business or AdWords may be your best bet. Want to increase customer engagement? Social media such as Facebook or Twitter allow customers to reach you directly.  Want to drive your reputation? Consider review sites such as Yelp, Angie's List or Thumbtack. Looking to just bring awareness around your neighborhood? Old-fashioned methods such as flyers, door-hangers, or shopping cart ads may work best. VistaPrint has some wonderful, affordable printing and promotional items. Do you need to improve your community engagement? Consider joining your local Chamber of Commerce, civic organizations, or BNI group. Need to improve your retention and stay in touch with your customers? Using email marketing tools like Constant Contact or Mail Chimp will save you time and effort.

WHY:  Understanding why to market is easy, but making it a priority is difficult for many small business owners.  I wish I had a nickel for every time I heard "But I'm not a salesperson". Yes, you are!  You are the only one with a passion and vision for your business and there is no one better suited to promote it than you!

If you are uncomfortable with marketing, get a coach, mentor or advisor to help you with the basics. Did you know that there are 3.5 Billion internet users and 3.8 Billion mobile users worldwide? We have the ability to reach customers more easily and more affordably than ever before!  At the SBDC, we have a great tool called the Digital Analyzer that will show you what your company needs to be digitally ready to reach this e-commerce market. If you don't yet have a website, or Facebook page, we can help you build one on your own or direct you to a professional designer.

I hope this article has got you excited and thinking about how to best market your business.  If you have questions or need help, visit www.wsbdc.org and set up a no-cost appointment with an advisor in your area.

Friday, July 8, 2016

Three Trees Yoga - Highline SBDC Success Story

A long term client of Highline SBDC, Three Trees Yoga has partnered with the City of Federal Way to offer Yoga and Tai Chi as part of the celebrated opening of Town Square Park. “Peace in the Park” classes will be offered August 2nd – September 29th. http://www.threetreesyoga.com/upcoming_events/workshops.html#peace.

Three Trees Yoga expands on their mission:

“Our primary intention before opening the doors of Three Trees Yoga was that it would be a place of community connection, and a resource for people looking to enhance well-being…”

After ten years of offering yoga and yoga teacher certification, Three Trees Yoga sees another opportunity to serve their members and community in a broader way. Observing how yoga improved the overall physical and mental health of their members, the founders still felt there was more that could be done. They began to explore a clinically proven method to improve one’s ability to cope with and decrease work-related stress and burnout. That’s when they reached out to the SBDC.

“The SBDC has been an integral part of the growth and development of Three Trees Yoga over the past 11 years. The majority of decisions effecting our business were first discussed in the Highline SBDC office”, said Suzy Green - one of the three partners of Three Trees Yoga. “So it was only natural to seek guidance and support of the advisors from the SBDC as we launched the new corporate wellness business, Work Well NW.”

Work Well NW is a corporate wellness business focused on the restoration and prevention of clinical burnout in the medical and professional fields. Strategy sessions with the SBDC resulted in some key actions to move the company toward being a fully integrated Health and Wellness company. Recommendations included setting up a Board of Advisors familiar with the demands and need of medical professionals, sales and marketing for this new market sector, and to seek accreditation for their program through Physicians Insurance, thus allowing nurses and doctors to use this training for their required CE credits.

Today, Work Well NW is actively working with St. Francis Hospital in Federal Way Washington; a division of CFI Franciscan Health, Physicians Health Insurance, other regional hospitals and corporations in their wellness programs. 

Attorneys are seeing a similar need as they are witnessing depression and suicide rates increase among their practitioners.  Also of concern is the high turnover of female attorneys who are leaving the profession.  As companies see this growing trend of burnout and stress they are acting to counter the situation through assisting their staff to recognize and deal with the daily stresses. Work Well NW is perfectly positioned to fill this market need.

For more information about Three Trees Yoga and Work Well Northwest contact Suzy, Jeni or Karen at 253-815 YOGA(9642) or visit http://www.threetreesyoga.com/about_us/contact_us.html.

Article written by:
Rich Shockley, Certified Business Advisor

Tuesday, July 5, 2016

Getting Things Done

As small business owners, we often do the job of three or more people. We are our own salesperson, customer service team, and we produce the service or product that we are marketing.  Then there’s the bookkeeping, tax preparation, community networking, you know the drill.  But how can we decide how to prioritize?  How do we make the next thing the next thing?  Below are several sources that I have found helpful through the years so I wanted to share them with you:

1.     David Allen “Getting Things Done  The GTD Methodology is as follows:
·        Capture – collect what has your attention – use an notepad, digital list such as Evernote, Trello, or Outlook to capture everything that has your attention; all your To Do’s, projects and things to handle or finish. What is keeping you up at night?
·        Clarify – Ask if it is actionable.  If not, than archive it or trash it.  If yes, decide the very next action required. If it will take less than two minutes Do It Now.  Move, delegate, or set a time frame and pencil it in your calendar.
·        Organize – Put action reminders on the right list. For example; Calls to Make, Errands to Run, Emails to Send, etc.
·        Reflect – Review your list carefully. Get clear, get current, get creative.
·        Engage – Use your system to take appropriate actions with confidence. Simply Do!

2.      Check out 27 ways to get more Sh!t Done:

My favorite tips are:
·        #8 Silence the Phone – this is tough, but critical!  Work without distractions, and that includes social media on your smart phone.  Put it on the charger in another room. Or, if you are a techie, check out the app Focus
·        #9 Make a To Don’t List – Know and understand the things you are wasting time on.
·        #16 Eat the Frogs - Do your least favorite thing first so that you don’t keep putting it off. It will feel good to have gotten something accomplished and you won’t dread it anymore.
·        #18 Track time – Do you know the average length of time it takes you to go through your inbox?  If there are tasks that you must complete every day, be aware of how long they take so you can budget your time accordingly.  Then put it on your calendar! 

3.      Mary Kay Ash – Six Most ImportantThings – the reasons there are only six?
·        The list is made the night before so you don’t have to re-think what your goals were
·        You begin your day with a focus on accomplishment
·        You get the satisfaction of having a list completed
·        You practice discipline daily and reinforce a good habit
·        You set work standards for yourself and your team to follow
                 “Is What I’m Doing Right Now Taking Me Where I Want to Go?”

4.    James Altucher – Become an Idea Machine
  • “Ideas are the currency of life. Not money. Money gets depleted until you go broke. But good ideas buy you good experiences, buy you better ideas, buy you better experiences, buy you more time, save your life. Financial wealth is a side effect of the “runner’s high” of your idea muscle.” Carry a small notepad, like a waiter’s pad with you at all times and try to come up with 10 ideas a day. About anything. Just to keep your brain working.
I hope you found this post interesting.  If you would like to make an appointment for one-on-one, no-cost advising at the Small Business Development Center at Highline College, please click HERE.