There are key action steps that you, as a small business owner, should take in your quest to not only survive, but thrive, as you guide your organization into the “new normal” world of business.
Build and cultivate your “A” team
“As we look ahead into the next century, leaders will be those that empower others.” – Bill Gates
• Now is the right time to right-size and right-fit your organization. Think about developing a network of recruiters to hire the best. Be deliberate and fully vet your candidates. Be patient. The time you invest should pay off in the long run.
• Give recognition; be transparent and communicate frequently to share the “Good, Bad and Ugly.” Solicit input; listen and respond appropriately.
• Empower your employees with meaningful tasks that inspire growth. These individuals may well be the successors of your business.
It’s all about the numbers
“If you don’t know your numbers, you don’t know your business; it’s that simple” – Marcus Lemonis
• Know your numbers! If you don’t understand them, reach out to your professional advisors. They will help you benchmark and provide you with an objective picture of the health of your business
• Understand what the key metrics are for your industry. Develop a plan to monitor and react to these metrics on an ongoing basis.
• Plan for raising capital well ahead of time; the worst time to ask for money from your lender is when you need it.
• Know where and how you make your money by product line, service, location, division, etc. Be decisive and make changes when needed.
• Start tax planning now for 2020. Don’t forget that expenses associated with loans forgiven under the Payroll Protection Program are currently not tax deductible. Your taxable income may be higher than you think!
Keep it legal
“Risk comes from not knowing what you are doing” – Warren Buffet
• Insist on a buy-sell agreement. This is the equivalent of a pre-nuptial contract for businesses. It is nearly impossible to unwind businesses peacefully without this written understanding.
• Protect vital business assets (trade secrets/key employees) with confidentiality agreements. Consider key-person insurance and non-compete agreements. Realize that your most important business assets (human capital) walk out of your door every day (literally or figuratively).
• Have your attorney conduct an annual legal audit to review contracts, purchase orders, customer, vendor, employee and contractor agreements.
Look to the future
“Begin with the end in mind.” – Steven Covey
• Develop exit strategies. Prepare your business to continue and succeed without you.
• Know what your business is worth; it is likely your largest asset.
• Identify, grow and train qualified successors. These may be family members or employees. The stronger your team, the more your business is worth.
• Join, network and be active in your industry associations and with other similar businesses. You never know if you might find your next growth opportunity within this group.
As a small business owner, it is up to you to lead. Take the initiative to protect your business and help it reach its full potential. For more action steps see the May/June issue of Corp! Magazine.
“To map out a course of action and follow it to an end requires courage.” – Ralph Waldo Emerson
