One of least mentioned areas of business is the time and energy spent creating a business report. This is a strange trend considering how important they are. All of the business reports I have put together were done to inform the reader of an area of business critical to its operations. It can be done in a number of different ways from internal external, technical, or non-technical.
I've always found that business report writing is an essential part of the business environment, especially in the communications part of it. As report writing grows in complexity, knowing how to properly collect relevant information and make that readable is becoming increasingly important in a rapidly developing business environment. Here are some tips to help you put an easy to understand and effective business report:
* You're first mission will be to define the purpose of the business report. I like to get it done early in case my time and energy need to be used on anything but the main goal. In order to put together a reliable report, you'll need all of the pertinent information together so gather that up. This doesn't require too much. All you will need is talking to people involved or conducting a research project.
* Gather up all information relevant to the report and organize in its importance. The only information in the report should be on the main goal or topic. Keep it focused and only discuss ideas within the scope of the report. For example, if you are writing this business report with the purpose of identifying potential new markets, only write about new market information.
* As with anything you plan on writing, knowing your audience is critical. You better know who you are writing to and for. After that, decide on how best to address your audience. Factors such as tone, attitude and emphasis should all be addressed so your message is geared towards them.
* The business report should be composed of strong, action verbs. You want your audience to be motivated from what you have to say. This includes the use of effective, well arranged sentences. I try to use scannable copy for certain sections of the report. You'll find that a good portion of your audience may only scan the report. Employ the use bulleted points, plenty of white space, good headlines and short paragraphs to catch their attention as much as possible.
* Finally, after everything is all said and done and you're close to completing the report, you're final step is proofing, editing, and distributing the report. I like to ask a colleague to read over the report for me as a second set of eyes. It helps to make sure your message is clear and focused. Leave yourself plenty of time in case anything in the report needs to be fixed or adjusted last minute. Ensure all documents and attachments are included.
Merit Capital Advance looks at the big picture by offering a financing program that provides small businesses with fast business cash It is the most convenient way to get a small business cash advance when you need it most. Visit Merit Capital Advance at http://www.meritcapitaladvance.com
Saturday, March 22, 2008
Guarantee a Successful Home Business by Creating a Sound Budget
Most small or home business owners get by day to day working with a small budget. It can be a frustrating time when you don't have the money or the ability to get the proper tools you need to run your business effectively. The truth is it takes a lot of hard work and some serious business skills in order to build a successful business without a large budget.
One of the reasons why I recommend a business create a budget is that they allow you to plan ahead. It lets you know how much money to save when looking to buy new inventory or how much to ask for as a loan. You need to know how much it will cost you to operate on a monthly basis as well as estimating your sales.
To do up a proper budget, you will need to spend some time thinking about everything your business will have to do. Here are some the best pieces of information I have on setting up a home business budget:
* The first step is to organize all of your home business's current bill statements. Get them in order in front of you by due date or bill amounts. It is easiest to organize if you create two separate categories for the budget. The first one includes all of the expenses you have incurred and the other one is the amount income generated.
* Time to get out the old calculator. You want the total amounts from each of those two categories. This helps you see if your home business is making a profit or not. If your expenditures are greater than your home business income, you need to come up with a plan to find out where all of your extra money is going. Just one simple change in your spending habits can increase your business cash flow.
* You're next step is to begin setting goals. This isn't a step to take lightly. What are the reasons why you started your business in the first place? By answering this question, you can best decide what will work for your business venture and what won't.
* Once, you've decided upon a budget, stick to it. What is the point in creating a budget if you don't plan on following it? Another reason why I like budgets for a home business, is that they can be a great indicator of your level of success. You'll quickly be able to see if your income is increasing and if it isn't you can change what you're doing to make it.
* Lastly, you want to stay organized. After you've completed all of the number crunching and put together some totals, put together a spreadsheet. This allows you to access of this information much easier than you normally would be able to. Say goodbye to the days of looking for long lost receipts come tax time. With a spreadsheet, all the information you need is right in front of you.
Merit Capital Advance looks at the big picture by offering a financing program that provides small businesses with fast business cash It is the most convenient way to get a small business cash advance when you need it most. Visit Merit Capital Advance at http://www.meritcapitaladvance.com
One of the reasons why I recommend a business create a budget is that they allow you to plan ahead. It lets you know how much money to save when looking to buy new inventory or how much to ask for as a loan. You need to know how much it will cost you to operate on a monthly basis as well as estimating your sales.
To do up a proper budget, you will need to spend some time thinking about everything your business will have to do. Here are some the best pieces of information I have on setting up a home business budget:
* The first step is to organize all of your home business's current bill statements. Get them in order in front of you by due date or bill amounts. It is easiest to organize if you create two separate categories for the budget. The first one includes all of the expenses you have incurred and the other one is the amount income generated.
* Time to get out the old calculator. You want the total amounts from each of those two categories. This helps you see if your home business is making a profit or not. If your expenditures are greater than your home business income, you need to come up with a plan to find out where all of your extra money is going. Just one simple change in your spending habits can increase your business cash flow.
* You're next step is to begin setting goals. This isn't a step to take lightly. What are the reasons why you started your business in the first place? By answering this question, you can best decide what will work for your business venture and what won't.
* Once, you've decided upon a budget, stick to it. What is the point in creating a budget if you don't plan on following it? Another reason why I like budgets for a home business, is that they can be a great indicator of your level of success. You'll quickly be able to see if your income is increasing and if it isn't you can change what you're doing to make it.
* Lastly, you want to stay organized. After you've completed all of the number crunching and put together some totals, put together a spreadsheet. This allows you to access of this information much easier than you normally would be able to. Say goodbye to the days of looking for long lost receipts come tax time. With a spreadsheet, all the information you need is right in front of you.
Merit Capital Advance looks at the big picture by offering a financing program that provides small businesses with fast business cash It is the most convenient way to get a small business cash advance when you need it most. Visit Merit Capital Advance at http://www.meritcapitaladvance.com
Tips for Staffing Your Small Business Through Recruiting Skills
As a successful small business owner, you can kiss your free time goodbye. You are forced work to long hours, forget about holidays off and expect to spend every weekend working. Sorry but that's the price you pay when becoming a small business owner. One way to get around it is by hiring qualified employees.
The current economic situation has created an increasing unemployment rate but also a growth in qualified candidates. This is a golden opportunity for a small business owner like yourself to find and hire a star employee.
Don't wait too long for this opportunity to pass you by. Finding and keeping employees is a demanding task for a small business and there are no real big secrets to hiring someone. To prove this, here are some of the steps I take to hiring through recruiting:
* My first piece of advice is to get out there and network. I found that this may be the most effective way to not only find new business opportunities but to also find workers. Ask around to friends and family members if they know anyone smart looking for a job, more specifically for your company. Another place to look are alumni groups. Search for recent college grads or even current students looking for a chance to break into the workforce.
* Don't be afraid to go after people that are looking for a change in the middle of another career. These people tend to be the hardest workers you'll find. They are often take their job much more seriously than a worker right out of college and it shows in their motivation.
* It's your company so don't be shy about promoting it the most you possibly can. Let the world know what makes your business different from anybody else's. If you don't care about the subject matter, then why should we? You're interest in the business shows. Don't forget about that.
* How much education is important or required for the position you are looking to fill? There are plenty of qualified potential employees out there that may not have a degree. Some of the most competent employees I ever had working for me had nothing more than a high school education. Often, I am more impressed by someone choosing to attend school later on as an adult than somebody who coasted through as a teen. It shows they took their education and their career seriously and worked their way through school.
* Post your job position online if it requires them to spend a lot of time working on the Internet. Not only is it a quick way to screen prospects but it's also the easiest. Just from one response you can see how that applicant knows how to work their email and attachments.
Merit Capital Advance looks at the big picture by offering a financing program that provides small businesses with fast business cash It is the most convenient way to get a small business cash advance when you need it most. Visit Merit Capital Advance at http://www.meritcapitaladvance.com
The current economic situation has created an increasing unemployment rate but also a growth in qualified candidates. This is a golden opportunity for a small business owner like yourself to find and hire a star employee.
Don't wait too long for this opportunity to pass you by. Finding and keeping employees is a demanding task for a small business and there are no real big secrets to hiring someone. To prove this, here are some of the steps I take to hiring through recruiting:
* My first piece of advice is to get out there and network. I found that this may be the most effective way to not only find new business opportunities but to also find workers. Ask around to friends and family members if they know anyone smart looking for a job, more specifically for your company. Another place to look are alumni groups. Search for recent college grads or even current students looking for a chance to break into the workforce.
* Don't be afraid to go after people that are looking for a change in the middle of another career. These people tend to be the hardest workers you'll find. They are often take their job much more seriously than a worker right out of college and it shows in their motivation.
* It's your company so don't be shy about promoting it the most you possibly can. Let the world know what makes your business different from anybody else's. If you don't care about the subject matter, then why should we? You're interest in the business shows. Don't forget about that.
* How much education is important or required for the position you are looking to fill? There are plenty of qualified potential employees out there that may not have a degree. Some of the most competent employees I ever had working for me had nothing more than a high school education. Often, I am more impressed by someone choosing to attend school later on as an adult than somebody who coasted through as a teen. It shows they took their education and their career seriously and worked their way through school.
* Post your job position online if it requires them to spend a lot of time working on the Internet. Not only is it a quick way to screen prospects but it's also the easiest. Just from one response you can see how that applicant knows how to work their email and attachments.
Merit Capital Advance looks at the big picture by offering a financing program that provides small businesses with fast business cash It is the most convenient way to get a small business cash advance when you need it most. Visit Merit Capital Advance at http://www.meritcapitaladvance.com
Monday, March 17, 2008
Small Business Finance Recently Uncovered - Determining Your Direct And Indirect Costs
There are two types of costs "direct" and "indirect." Direct costs are also called "variable costs" and refer to costs that are a direct result of producing, delivering, or returning your product/service. Examples of these are materials and labor needed to produce/deliver the product that only occur once you sell the product, transactions costs like visa commissions, sometimes shipping charges, etc.
Indirect costs are also called "fixed costs" and refer to expenses that your business will have regardless of sales volume. Examples of ithese are rent, utilities, wages that are not based upon commission, interest expense, advertising, automobile, etc. The tricky aspect of these are that a cost may increase with increased sales, e.g. an increase in sales may require overtime or the addition of staff but the relationship is not direct.
A good tool for managing direct and indirect costs is to monitor the costs on your monthly income statement using percent of sales. Divide the cost by total sales.
Direct costs as a percent of sales will remain within a narrow margin, e.g. materials costs if 30% of sales at $1,000 sales then materials should be right around 30% at the $5,000 sales level. The actual dollar amount of materials used to produce more products will go up but as a percent of sales, it will remain close to 30%. What would lower the percent is if you got a better deal from your supplier.
Your indirect costs when monitored as a percent of sales will respond differently. For example, rent equaling $500 per month remains $500 per month even if your sales increase to $5,000. $500 divided by $1,000 in sales equals 50%. $500 divided by $5,000 in sales equals 10%. (It is that old math axiom in action here: A numerator divided into a larger denominator produces a smaller fraction.)
So why is this important? Knowing the difference between direct and indirect costs provides you with a couple of valuable management tools, break-even analysis, and your contribution margin. Break-even analysis is a handy management tool for quickly determining if a solution is feasible. Contribution margin is the remaining profit after direct costs are taken out of a sale. For example, if you sell a bookcase for $250 and it cost you $75 to make your contribution margin is $175 or 70%. The contribution pays for all the Fixed expenses/overhead.
A good way of organizing these costs is to put all the direct costs in the "Cost of Goods" section and the indirect costs in the expense area of your income statement. By doing this Gross Profit equals Contribution Margin and is automatically calculated for you.
Another reason to identify your direct costs is when bidding in a competitive environment. Ever wonder how your competitor beat you on a bid??
Imagine a situation where you know you have covered your overhead expenses for the month with normally bid projects. A quick project comes up for bid around the 15th of the month and you have a crew available to work on it. You figure it will be very competitive and if you use your usual estimating process on it you will not get the project. Since you have already covered all your expenses for the month and any margin above your direct costs is profit. Plus you have a crew that it would be better to have working on a project and being paid by a client versus cleaning the shop being paid by your profits. You decide to aggressively go after the project with a bid slightly above your direct costs.
Bruce Hunter is the CEO of CORE Magazine in Denver Colorado CORE is the leading online source for small business startup. Visit our free online resource center now to get free access to information on small business finance
Indirect costs are also called "fixed costs" and refer to expenses that your business will have regardless of sales volume. Examples of ithese are rent, utilities, wages that are not based upon commission, interest expense, advertising, automobile, etc. The tricky aspect of these are that a cost may increase with increased sales, e.g. an increase in sales may require overtime or the addition of staff but the relationship is not direct.
A good tool for managing direct and indirect costs is to monitor the costs on your monthly income statement using percent of sales. Divide the cost by total sales.
Direct costs as a percent of sales will remain within a narrow margin, e.g. materials costs if 30% of sales at $1,000 sales then materials should be right around 30% at the $5,000 sales level. The actual dollar amount of materials used to produce more products will go up but as a percent of sales, it will remain close to 30%. What would lower the percent is if you got a better deal from your supplier.
Your indirect costs when monitored as a percent of sales will respond differently. For example, rent equaling $500 per month remains $500 per month even if your sales increase to $5,000. $500 divided by $1,000 in sales equals 50%. $500 divided by $5,000 in sales equals 10%. (It is that old math axiom in action here: A numerator divided into a larger denominator produces a smaller fraction.)
So why is this important? Knowing the difference between direct and indirect costs provides you with a couple of valuable management tools, break-even analysis, and your contribution margin. Break-even analysis is a handy management tool for quickly determining if a solution is feasible. Contribution margin is the remaining profit after direct costs are taken out of a sale. For example, if you sell a bookcase for $250 and it cost you $75 to make your contribution margin is $175 or 70%. The contribution pays for all the Fixed expenses/overhead.
A good way of organizing these costs is to put all the direct costs in the "Cost of Goods" section and the indirect costs in the expense area of your income statement. By doing this Gross Profit equals Contribution Margin and is automatically calculated for you.
Another reason to identify your direct costs is when bidding in a competitive environment. Ever wonder how your competitor beat you on a bid??
Imagine a situation where you know you have covered your overhead expenses for the month with normally bid projects. A quick project comes up for bid around the 15th of the month and you have a crew available to work on it. You figure it will be very competitive and if you use your usual estimating process on it you will not get the project. Since you have already covered all your expenses for the month and any margin above your direct costs is profit. Plus you have a crew that it would be better to have working on a project and being paid by a client versus cleaning the shop being paid by your profits. You decide to aggressively go after the project with a bid slightly above your direct costs.
Bruce Hunter is the CEO of CORE Magazine in Denver Colorado CORE is the leading online source for small business startup. Visit our free online resource center now to get free access to information on small business finance
Small Business Budgeting Tips - Perfecting the Plan That Keeps You On-Track
At the end of every fiscal year companies tallying up their scores to see how they've finished. Unlike the game of golf having the highest score is cause for celebration, being in the black you've done well and deserve some congratulations. If there isn't a soirée going on in your business maybe it's because you didn't plan for a year-end party, and that could be the direct result of your failure to budget.
To be successful in business, budget cannot be a taboo word in your company. One of the skill sets you as an owner or manager need to possess is the ability to plan ahead, this includes that ability to budget. If you're a visionary and lack budgeting skills, then stop reading and go find someone who is. So before we discuss budgeting tips, let's first discuss what a budget is and isn't.
What a Budget Is:
A budget is a proposed plan to monitor financial activity over a period of time. A budget is a planning tool an owner and/or manager should be using to measure trends over a fixed interval; this includes inflow, outflow, and asset/ liability growth. Finally a budget is a resource to forecast an assumed outcome.
What a Budget is NOT:
A budget is not the law; it is not to be used as a means of accountability and to ensure financial integrity. A budget is not to be used a ceiling to spending, and a method of absolute control. And finally a budget is not a guarantee so financial and business success.
So now that we have defined what a budget is, let us get to how to properly use and understand how a budget actually benefits a company.
The budget should be put together and approved at least 1-2 months prior to the start of the new fiscal year. This will allow for key employees to look at what the company is trying to accomplish and what is being aimed for. So for this to happen planning will need to take place approximately 3-6 months before the start of the new fiscal year, this of course depends on the complexity and size of the company.
The budget should reflect the direction that the company is headed in; this of course is handed down by the CEO and/or Board of Directors. Everything about the budget should point towards the strategic plan the company has adopted. The budget should also be multifaceted, not only should you include a Profit & Loss operating budget, but also a Balance Sheet budget to help track cash inflows and outflows.
Finally the budget should be realistic. An exponential increase in revenues without any foundational proof or purpose can lead to fiscal year failure. Again remember the budget is for mapping out trends in an attempt to forecast growth or decline. All the pieces must fit, in business there is usually a cause for increased revenues (hint: check for the reason in your expenses section!).
To summarize let's recap the key points:
1. Budget is not taboo
2. Budget is a proposed plan
3. Budget is not the law
4. Approval should allow for time to disseminate throughout the company
5. Reflects the strategic plan and heading of the company
6. The budget should be realistic, for all growth there should be a reason
Jayson Cardwell is the Founder and President of Serium Consulting, LLC a non-profit and church consultancy. Serium Consulting specializes in helping board members, directors, pastors, and leaders in the business aspects of running an organization. This is accomplished through consulting in the areas of Financial Management, Analysis, Strategic Planning, Executive Development, Organizational Development, and Management Consulting.
For more information about Serium Consulting and how they can help you visit them on the web at http://www.SeriumConsulting.com
To be successful in business, budget cannot be a taboo word in your company. One of the skill sets you as an owner or manager need to possess is the ability to plan ahead, this includes that ability to budget. If you're a visionary and lack budgeting skills, then stop reading and go find someone who is. So before we discuss budgeting tips, let's first discuss what a budget is and isn't.
What a Budget Is:
A budget is a proposed plan to monitor financial activity over a period of time. A budget is a planning tool an owner and/or manager should be using to measure trends over a fixed interval; this includes inflow, outflow, and asset/ liability growth. Finally a budget is a resource to forecast an assumed outcome.
What a Budget is NOT:
A budget is not the law; it is not to be used as a means of accountability and to ensure financial integrity. A budget is not to be used a ceiling to spending, and a method of absolute control. And finally a budget is not a guarantee so financial and business success.
So now that we have defined what a budget is, let us get to how to properly use and understand how a budget actually benefits a company.
The budget should be put together and approved at least 1-2 months prior to the start of the new fiscal year. This will allow for key employees to look at what the company is trying to accomplish and what is being aimed for. So for this to happen planning will need to take place approximately 3-6 months before the start of the new fiscal year, this of course depends on the complexity and size of the company.
The budget should reflect the direction that the company is headed in; this of course is handed down by the CEO and/or Board of Directors. Everything about the budget should point towards the strategic plan the company has adopted. The budget should also be multifaceted, not only should you include a Profit & Loss operating budget, but also a Balance Sheet budget to help track cash inflows and outflows.
Finally the budget should be realistic. An exponential increase in revenues without any foundational proof or purpose can lead to fiscal year failure. Again remember the budget is for mapping out trends in an attempt to forecast growth or decline. All the pieces must fit, in business there is usually a cause for increased revenues (hint: check for the reason in your expenses section!).
To summarize let's recap the key points:
1. Budget is not taboo
2. Budget is a proposed plan
3. Budget is not the law
4. Approval should allow for time to disseminate throughout the company
5. Reflects the strategic plan and heading of the company
6. The budget should be realistic, for all growth there should be a reason
Jayson Cardwell is the Founder and President of Serium Consulting, LLC a non-profit and church consultancy. Serium Consulting specializes in helping board members, directors, pastors, and leaders in the business aspects of running an organization. This is accomplished through consulting in the areas of Financial Management, Analysis, Strategic Planning, Executive Development, Organizational Development, and Management Consulting.
For more information about Serium Consulting and how they can help you visit them on the web at http://www.SeriumConsulting.com
Top 10 Reasons Small Businesses Fail
Every time a small business fails I get dismayed. The owners of a new business have often staked their entire capital on a new venture and they stand to lose a lot more than if a big company fails in their new venture. Before you start a new business familiarise yourself with the top 10 reasons why many new businesses fail.
1. The manager is incompetent
Most small businesses fail because the owner does not have the knowledge to run a business properly. It is advisable to do a basic business course before starting a new venture.
2. Finances are not in place
Many people start out in business without any idea of how much money is really required. If you do not know how to write a business plan get your accountant to help you. In any new start-up cash flow is king and without proper funding even the best idea will fail.
3. The Owner gives up too quickly
Any new business will be lucky to break even in their first year. Many people new to business often assume that they are going to make a fortune within 12 months. In reality less than 80% of new start-ups make a profit in their first year.
4. Advertising
There is zero point in doing a single leaflet drop to all your potential customers. There is no point in doing a single advertisement in your local newspaper. Advertising is all about repetition. Many of your potential customers will not buy your products until they have seen your marketing material at least half a dozen times.
5. Branding
Every single piece of your company has to scream out your brand including your brochures, websites, delivery vans and the uniforms that you and your staff wear.
6. Ability to close the sale
This is really an art form in itself. Some people are naturally good closers but others have to learn by reading and studying the art of closing a sell. The more you practice the better you will become.
7. Location
Location is very important to the chances of your businesses survival. Often you will have to pay more for a decent location but it can make the difference between just getting by and turning a decent profit.
8. Ability to get on with other people
We all know that we have to treat our customers with respect but what about our suppliers. If you do not pay your suppliers on time they will start quoting you higher prices. If you are rude to them they might stop doing business with you altogether.
9. Lady Luck
Some people are really unlucky; there is no getting away from this. Just hope and pray that Lady Luck smiles at you, especially in the first year.
10. Demand and USPs
Small businesses often overestimate the demand and usually have no unique selling proposition built in to their products. If people only ever need to buy one of your widgets and you make millions, chances are that you are heading for a point of no return.
Examine all the points above. If you feel that you have an answer to most of them then you are ready to take the plunge and start your own business.
Naz Daud is the founder of CityLocal. This Business Franchise Opportunity is for people who would like to work from home and be their own boss.
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