Plans need frequent evaluation

June 13, 2009, 3:23AM

Q:In your most recent column you provided advice on where to find resources to prepare a good business plan. Now that I have one and have started up, what do I do with the plan?

A:You’ve put a lot of time and effort into your business plan. Think of it as a living document, and refer to it and review it often. Use your business plan as a tracking and evaluation tool, so that you can determine if your business is heading in the right direction or if it has wandered off course.

Schedule periodic checkups of your business. Many factors that affect your business are tied to an annual cycle. To ensure that your business plan continues to serve you well, make it a habit to update it annually. Set aside a block of time near the beginning of the calendar year, fiscal year or whenever is convenient.

Make this review a priority activity. Often small-business owners allow their time to get absorbed on the more urgent operational tasks and don’t allow time for vitally important management and planning activities.

Validate the assumptions used in your plan. Our business environment is always changing, so ensure that the basesused for your plan are still appropriate.

Assess your performance by reviewing the data in your plan. Compare your expected results against your actual results. Because your plan sets forth marketing, operational and financial milestones, you should carefully analyze actual operating results against the goals and objectives.

Fine-tune your plan. Parts of your business plan may feel very tight and others may still need some work. Look for ways to improve what you’ve done so far. Incorporate the experience you’ve gained as a business owner into your business plan. Anticipate future events — good and bad — that may affect your business. Take appropriate action if goals outlined in your plan haven’t been met.

Get help from others. After you change and update your business plan, share it with your advisers. SCORE, Counselors to America’s Small Business, is experienced in helping entrepreneurs create and revise business plans.

Strive to operate your business according to your plan. Your business plan will work for you if you use it to remind yourself and your team where you are going and how you will get there.

Whether you’re updating your business plan for the first time or the 20th, treating your business plan as a document that evolves over time proves that you understand your business and you know what is required to make it grow and prosper.

Business plan help is easy to find

May 30, 2009, 5:24PM

Q: The process of writing a business plan is daunting to me. How do I get started?

A: When this happens to aspiring entrepreneurs, the obstacle is often just knowing what information is needed and where to find it, and then actually putting it down on paper.

For starters, you’re not venturing into unknown territory. Millions of people have transformed their ideas into thriving enterprises. Putting together a business plan is a valuable learning experience, an opportunity to learn about your chosen new field, and yourself. The proverbial first step of this journey is relatively easy.

Many valuable resources are available that can guide you through the process from start to finish. These aids can’t do all the work for you. You still will need to invest a fair amount of time and effort in research, writing, revising and more research.

But once you do get started, you may well find yourself wondering why you waited so long.

To get a complete picture of how a business plan is structured, visit the Small Business Administration’s Web site, www.sba.gov/smallbusinessplanner. The pages outline the elements found in most business plans and provide a wide range of sample plans for various types of businesses.

The SBA’s basics page also offers helpful guides to financing, marketing, employee relations, taxes and other topics that entrepreneurs should consider as they shape their business plans and strategies. At SCORE’s Web site, www.scorehouston.org (click on free business resources), you’ll find many valuable tools and other information. Download the easy-to-follow templates directly to your computer and get started.

Each section of the business plan templates explains the type of information that’s needed, why it’s essential to the plan, and the questions you will need to answer when seeking financing.

Remember, however, that while these tools can provide a good start, they are by no means all-inclusive and you may need more guidance from experienced business counselors.

Take advantage of free and confidential business counseling at one of SCORE’s several Houston area locations or attend one of SCORE’s workshops or seminars on business planning. If the nature of your business or industry requires considering specific issues, go to www.score.org and request online assistance.

Credit crunch for small businesses may be easing

May 2, 2009, 5:23PM

Q: Is there any help on the way to encourage lending to small businesses including startups and acquisitions?

A: The American Recovery and Reinvestment Act passed by Congress in mid-February has a number of provisions to enhance the Small Business Administration’s loan programs, and three have already been implemented.

The first deals with the SBA’s 7(a) loan program, which guarantees a portion of bank loans to entrepreneurs looking to start, expand or acquire small businesses. The 7(a) serves as a credit enhancement to the lender and provides collateral to the borrower. Most 7(a) loan program guarantees are temporarily raised to 90 percent of the portion of the loan being insured against default through 2009 or until the funds are exhausted.

The increase in guarantee levels will help banks extend credit and make more capital available to small-business owners around the country.

The act also temporarily waives the guarantee fees passed on to borrowers on 7(a) loans.

On Friday, the SBA temporarily increased the 7(a) loan size standard making more businesses eligible for 7(a) loans. Also , the fees paid by borrowers in the SBA’s 504 loan program are temporarily waived.

This program provides SBA financing for long-term fixed assets such as land, buildings (occupied by the borrower) and substantial machinery and equipment.

Through the SBA’s Surety Bond Guarantee program, the SBA guarantees bid, payment and performance bonds that protect a project owner against financial loss if contractors default or fail to perform. The maximum amount for contracts that qualify for SBA surety bonds has been raised to $5 million or $10 million depending on the type of contract.

The Recovery Act also expands the SBA’s Microloan program, which provides loans up to $35,000 through participating microlenders. These are paired with technical assistance to startup or growing small businesses.

The director of the SBA Houston District, Manuel Gonzalez, says, “In our district, we have seen an increase in 7(a) loan volume of approximately 50 percent over the period just prior to passing the Recovery Act.”

Starting a business? Pick one that blooms in recession

March 28, 2009, 2:37AM

Q: I would like to start or buy a small business, but the economic news these days is so depressing that I’m wondering if there are any good opportunities in today’s environment. Do you know of any?

A: There are many small businesses in Houston that are doing quite well despite the economic slowdown we face. Some are types of businesses in markets that are weathering the storm better than most. Others have acted aggressively to stimulate sales, have adjusted their product or service mix in response to changing customer needs, or have increased their efficiency to improve their bottom line.

For example, when the conventional wisdom was to trim down and scrutinize costs, Veronica Millstid-Levine, the owner-manager of Bailey Connor Catering, hired a marketing consultant and additional salesperson to root out more customers.

It paid off with a 21 percent increase in sales in 2008, and the company is on course for a greater increase in 2009.

“Auto repair is an example of a sought-after business in these recessionary times,” said Rose Stabler, Managing Partner of Certified Business Brokers.

“With the car dealerships going out of business and their repair shops along with them, there will be more people looking for private auto repair shops. In addition, more people are keeping their cars instead of buying new ones. Therefore, more repairs!” Stabler said.

One of Stabler’s current listings for sale in Houston boosted its earnings last year by 65 percent by providing superior auto service to its local customers.

Debbie Beal, owner-manager of A2Z Educational Supplies in Humble, worked with SCORE business counselor Bob Galbreath.

She emphasizes quality service to her customers, who are mostly schools and teachers.

Her sales increased by 28 percent last year, despite Ike, and are showing about a 40 percent increase year-over-year in 2009.

Vic Bailey of One Voice, a business communication services company, has maintained his sales volume by “hitting the streets” and paying visits to current clients and potential clients.

Improved telecommunications is one way his clients can increase productivity.

So he proactively gets out there to advise them on those improvements.

Marketing your small business successfully

March 13, 2009, 9:50PM

Q: I work independently, performing services or doing projects for clients. What advice do you have for finding freelance work that keeps the revenue coming in?

 

A: When you’re a freelancer or solo independent contractor, you are your own marketing department. It’s up to you to make the contacts and generate the work that will enable you to expand your business.

Freelance newcomers and veterans alike need to continually broaden and update their work-finding and marketing skills, not only to sustain their current workloads, but also to stay ahead of the competition.

Two keys to being successful at this are consistency and dedication. The search for work is a constant part of your independent enterprise, so you’ll enjoy it more if you develop a passion for finding the next big project.

The best source of new business is current customers. Doing good work for them will keep them coming back, which is why you also need to be a stickler for client satisfaction. Always stand behind your work and try to exceed client expectations.

It’s also important to stay in touch with your clients, even if you already have a substantial backlog of work. Check in periodically to ask how things are going, what projects or initiatives may be in the works, and remind them that you’re ready to help out if the need arises. They’ll appreciate your proactive interest, and planting that seed may pay off immediately or in several months when things start to slow down on your end.

Also recognize that building your personal brand is important. As a sole operator, your brand is you, so focus on leveraging your special knowledge, style or expertise. But don’t lock yourself in too tightly. The most successful independent contractors try to build new skills and leverage existing ones to higher price levels.

A substantial number of Web sites specialize in matching freelancers with potential clients. Their approaches are as varied as the range of industries they cover. Some work on a bid system where employers post projects and freelancers bid on the work. These sites will likely take a cut of your proceeds.

Then there are job boards, where projects are posted and you respond with a pitch letter and ré sumé directly to the employer. You may need to pay a fee to access these resources, so it’s a good idea to find out whether the amount of work or contacts generated are worth the investment.

Chambers give a range of help to small businesses

Feb. 27, 2009, 11:50PM

Q. I read your recent article on networking and how to interact with potential business contacts. Are chambers of commerce good places to network and worthwhile to join?

A. Chambers offer companies a range of resources to support, develop and grow their businesses as well as the local economy. From regulatory and legislative issues to enhancement of the business environment of your community, the chambers of our region are quite often at the forefront of positive change.

With chamber membership, a small investment in time and dollars can help contribute to your marketing, public relations, networking and team-building efforts.

Chamber membership expands your information and networking resources dramatically. Networking with other businesspeople gives chamber members the opportunity to meet and exchange information with each other.

“Contributing to chamber of commerce community activities brings visibility to your business as a good corporate citizen,” says Ann Hodge, CEO of the Katy Area Chamber of Commerce.

The chambers’ involvement in local charities, community cleanups, crime prevention programs and more give your business an opportunity to participate in positive changes in your community, often at minimal cost.

Powerful endorsements

“Area chambers are proud to recognize and reward this activity,” Hodge said. A company’s efforts are often lauded for months by other businesses, the community and elected officials. These accolades and respect from other local businesses serve as powerful endorsements and publicity for any company.

Are you concerned about the regulatory climate in your area and want to assume a role toward effective change? Your local chamber is the voice of business in a myriad of issues.

The chambers work to influence the agendas of city, state and national elected officials, keeping the interests of our local businesses in front of decision makers.

In addition to numerous networking events and other resources, most chambers offer educational and business counseling services to help their members resolve issues and improve their businesses.

For instance, SCORE provides free and confidential counseling as members of the Katy Area, Houston Northwest and Houston West chambers of commerce.

Get help coping with the recession

Feb. 14, 2009, 12:34AM

Q: The economic slowdown is starting to hurt my small business. How can I get ideas and assistance for coping with the challenges that small businesses face today?

A: Small businesses shouldn’t have to face the recession alone. And in Houston, they don’t have to.

Capital One Bank and SCORE have formed the Small Business Development Alliance. Its aim is to help Houston-area small businesses survive and succeed during the tough times. Small-business owners are invited to attend free seminar and networking events planned throughout the year.

At these events, you will take home coping strategies for tough times, meet with lenders of alternative financing, network with other small businesses and enjoy a free lunch.

“We recognize the important role small businesses play in stimulating our economy and rebuilding our communities and the determination it takes to open your own business,” said Laurie Vignaud, a senior vice president at Capital One bank.

At the events, you’ll have the opportunity to meet one-on-one to discuss your situation with SCORE counselors, Capital One bankers and their strategic partners:

• SCORE SMART squad members will explain how they can work with you at your location to help resolve business issues.

• The Small Business Administration will explain the SBA Loan Guarantee programs.
• Acción Texas provides credit to small businesses that do not have access to loans from commercial sources.
• Houston Business Development can provide low-interest-rate loans
and an array of support services and management assistance.
• The Houston Minority Business Council actively involves its members to increase and expand business opportunities and business growth for minority business enterprises.
• The city of Houston One Stop Business Center provides information on city, county, state and federal regulations affecting your business.

The next seminar is at the Church At Bethel’s Family, 14442 Fonmeadow Drive, in Houston next Saturday from 9 a.m. to 3 p.m. and includes a free lunch. Visit www.scorehouston.org to register and see the schedule and locations of the other free seminars.