By Mark Lerner and Ryan Rouille
You know how to assess and address your clients’ needs; however, it’s easy to neglect your own.
In challenging times, when business decisions have considerable personal and economic impact, it helps to have knowledgeable advice from a network of professionals who can help owners overcome challenges and lay the groundwork for future success. Consider the following 10 tips to help small and family business owners in challenging times.
1. Have a thoughtful, well-written business plan and stick to it.
Rather than getting caught up in daily operations of your business, set clear, realistic goals and objectives. Consider strategies that address the long-term plans of your business and how you plan to retire.
2. Seek out a network of business advisors.
By pulling together an informal board of directors made up of business owners in similarly-sized companies dealing with similar short- and long-term issues, owners can realize opportunities within their businesses that they may not have been able to see themselves, and they can work together to solve one another’s most pressing issues.
3. Find a financial professional with experience in serving small businesses.
Choose an experienced, local financial professional, trained to meet business owner needs, who you trust with your business and personal aspirations and who will help you with your plan for reaching your short- and long-term goals.
4. Know your core customers and delight them.
Understand your customers. Segment them and know where profitable business comes from. Make the extra effort to know how you can keep and grow your base of recurring customers.
5. Define and communicate your unique value in the market.
What do you do that no one else is doing? How is your service better than other services? Why should customers see you instead of your competition? Take a look at the competition; some may have changed their approach or exited the business. Develop a message that articulates your unique value proposition.
6. Hire better and offer good benefits.
Typically, the pool of talented, highly-trained, and educated people grows in a down economy as more and more people lose jobs. Find and hire strong talent. Offer voluntary benefits – those that you, as owner, offer to employees at a typically lower cost than they could obtain themselves. Voluntary benefits can be provided at no direct cost to you and reward people.
7. Revisit your overhead expenses and trim the fat.
Which overhead expenses can be reduced or eliminated? Can you reduce credit card fees? Discuss a reduction with your current provider.
8. Consider tapping your whole life insurance policy’s cash value, if stuck for credit.
Businesses hold whole life insurance policies for key person insurance, succession planning, and buy-sell arrangements. Whole life insurance builds cash value, guaranteed. A business can take a loan from its whole life insurance policy. The policy continues to receive dividends, which – although not guaranteed – can increase the policy’s death benefit and cash value or provide a source of income to pay some or all of the premiums due.*
9. Diversify into a complementary business.
A bad economy may cause business owners to retreat to their core business, but in doing so you might miss a chance to leverage your existing infrastructure. This is a time to understand the profitability of each line of your business. Ask yourself if there is a complementary option that might bring in more profits or heighten the visibility of the company overall. For example, an owner of a coffee shop could expand into some light catering for area business functions.
10. Develop an exit strategy and succession plan.
Are you approaching retirement and intending to sell your business for retirement income? An experienced financial professional can help you put a succession plan in place.
Your customers depend on your business. Your business depends on you. In challenging times, or anytime, an experienced local financial professional can help you and your business interests.
*Access to cash values through borrowing or partial surrenders will reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.
Mark Lerner and Ryan Rouille are financial representatives with Capstone Financial, a MassMutual Agency; courtesy of Massachusetts Mutual Life Insurance Company (MassMutual).
RELATED ARTICLE: 6 tips to help improve customer service in the dental practice
RELATED ARTICLE: How core values drive performance