By Suzi Dafnis, Australian Businesswomen’s Network

When I first started my business, I was 26-years-old and didn’t have a lot of business experience. I was lucky enough to have a one-on-one, face-to-face business mentor. At the Australian Businesswomen’s Network, we have taken the traditional business mentor model and brought it into the 21st century.

We offer a six-month mentoring program, MentorNet. Our program has won awards due to the way we use technology to facilitate collaboration. We have one mentor who could be situated anywhere in Australia (or anywhere in the world) and a mentoree who can similarly be in a small country town in Australia in a rural area or in a big city. Each mentor mentors a small pod of mentorees.

The program delivers not only mentoring

…but training in key business areas — and we use online collaborative tools in order to do that. Over six months, participants learn how to put together a business plan that includes finances, marketing, HR and all the core elements of a solid business plan. Further, we have an online, closed-door community that’s hosted in the cloud, where they go to read case studies, answer questions and post on their own blog about their findings.

Every two weeks, we conduct a web-based seminar using GoToWebinar by Citrix — we have an expert presenter who delivers information and interacts with the other people on the call. For example, when we enter the marketing module of the MentorNet program, the expert presenter asks participants to share their key marketing strategies.

Information exchanged in real-time

The Citrix GoToWebinar tool allows users to exchange information in real-time, link to their business websites and even share desktops. The chat function lets other participants give their impression of websites and other marketing materials. In this collaborative, interactive environment, participants can tell each other, “I’m lost when I arrive at your home page” or “The wording in this section is really complex and hard to understand.” The ability to get the input of other successful and aspiring businesswomen has been very helpful and made our MentorNet program a success.

The 2012 MentorNet program begins on 12 June. Learn more about the program. Registration is now open.

MORE GREAT BLOG POSTS BY SUZI DAFNIS

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• How Guy Kawasaki Enchanted Me
• Make Telephone Interviews Work: Tips for Preparing and Conducting Virtual Interviews

“I think financials are fun because having money is fun,” said Rhondalynn Korolak, author of Financial Foreplay, during a recent interview at Kochie’s Business Builders Boot Camp.

Not everyone shares her view. Finances are often left last after marketing, networking, social media, etc.

“I’ve noticed that everyone’s afraid of their financials, or they just hate them,” continued Rhondalynn. So I thought, ‘What I’m going to do here is help people move their business forward. I’ve got to make financials fun. I’ve got to make it easy and practical, and to do that, I’ve just created this concept of sexiness in business and relationships to tell the story”.

Some of Rhondalynn’s ideas may sound counterintuitive at first: “I’ve noticed that everyone wants to spend money on social media. What I’m saying is this: stop spending money on social media. I know this is controversial. Stop spending money on chasing customers. Learn how to unlock the insights in your financials, and you’ll learn how to make more money that way.

“Essentially, if you’ve got a cash flow issue in your business, there’s no point in chasing customers. You’re actually hurting yourself financially by doing that. What I’m advocating is to take a look and figure out where you’ve gone wrong. Perhaps you have stale or old inventory that you need to get rid of. That’s a good way to get cash flow in. Another way is to collect your debt. None of us like to ask for money, but I love asking for money because when it comes in, it goes straight into your back pocket.

Some people are afraid to ask others for money. I say, when you complete the work, you collect the money right then and there without any debt collection.

“Another way is to not allow debt in the first place. Some people are afraid to ask others for money. I say, when you complete the work, you collect the money right then and there without any debt collection. Another way could be to offer a simple discount for early payment, but be smart about it. Don’t just say, ‘If you pay early, you get 2 percent off or 3 percent off.’ Calculate what that means to your business financially before you offer it, because sometimes it’s actually not good for you”.

Rhondalynn pointed out that many businesses could save money by not wasting money on a vehicle they don’t really need: “Regardless of whether the government says you’ll get a 50 percent tax rebate, if you don’t have cash flow in your business and you don’t need that asset to produce income in your business, then you shouldn’t be buying it.”

“It’s simple things like that,” Rhondalynn concluded. “You can actually save money, and then you’ll have more money to advertise and do all the things you want to do that are more fun.”

Kochie’s Business Builder’s Boot Camp was supported by the Australian Businesswomen’s Network.

Related Links

Visit Rhondalynn’s website - Imagineering Unlimited.

Financial Foreplay: Whip Your Business into Shape and Take Home More Cash By Rhondalynn Korolak Order your copy of Financial Foreplay from Booktopia today and save.

By Cat Matson, Alito

I know, I know.  Technically, we’ve just ‘closed the books’ on the end of the financial year and started a new one.  But if you’re anything like me, the end of the financial year isn’t anywhere as significant a ‘line in the sand’ as the Christmas/New Year break. For me, 30 June represents the ‘half-way’ mark in the year.

And what does any good coach do at half-time? Delivers a rousing half-time address.

Here it goes …

How are you traveling in this game called your business?  Two quarters played for 2010 … are you happy with your score?  The ground has been rougher (for some) than first expected, and well-thought-out strategies may have given way to rough-and-ready (scrappy) tactics.  But that’s OK, you play the best game you can with the players you have in the conditions of the day.

How does your game plan need to change for the second-half?  Do you need to rotate players or change your plan of attack?  Is it time to stop playing defense?  Remember, the second half of the calendar year always goes faster than the first (much, much faster), so if you need to change strategies, you need to change NOW.

We entered this business year amongst a bit of nervous confidence (we were supposedly coming out the other side of the GFC), and we’ve been playing in that context now for more than 6-months … we know the state of play.  The question is, are you playing the best game you can in that context, or are you still using last year’s plays?

Now is a great time to take stock, review your business performance and chart your course of action for the next six-months.  The end of the financial year is a great opportunity to look at the financial score (resist the temptation to *not* do your numbers until tax deadlines or your accountant requires them). While you’re at it, look at other key indicators in your business, and determine if you’re on track to reach the targets you set for yourself at the beginning of the year.

Do you need to adjust the targets? Do you need to change the tactics? Does the overall strategy need some work?

Tell me, what will you be saying to yourself/your team in *your* half-time address?

MORE GREAT POSTS BY CAT MATSON

• No. The shortest word to write; the hardest word to say
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By Julie Wise, The SilverOwl

As I’m writing this on 1 July, it’s the very first day of the new financial year, yet, I feel like I have been living in it for at least six months. Budgets and plans for 2010 were formulated long ago, and sales pipelines already stretch to the middle of the financial year.  Last week, a client was even talking about his Christmas party! FY11 feels like an old friend, not a new acquaintance.

Business is a life led in the future, but I do think that it’s important & essential to occasionally spend an afternoon in the past.   In fact, I believe that the best thing you can do for your business right now is to cast your mind back over the last year and reflect.

You may say that there is nothing particularly revolutionary about that. After all, many people have asked you how the year has gone.  In truth, when someone such as a supplier, customer, financier, accountant, or school Mum asks you about your business, the likelihood is that you are measured in what you say.   Many of us, with great dexterity, weave a tale of cautious optimism, a little bravado, and a modicum of humility.  The real trouble is that we start to believe our own story.

This year it is even more important than ever to reflect on the year just gone, because we are still believing that we have been peculiarly blessed with a great alibi.  I am sorry, but you cannot use the GFC  as the excuse for a “less-than” performance.  If we simply put our performance, or lack of it, solely down to the GFC, we will miss out on the opportunity of using the other learnings from FY10 to build a great FY11.   Many people I hear talk fairly laissez faire  that “..things will come back..” when the GFC is over.

NO, things will not go back!   The world economy has been stretched to breaking point. Just like the rubber band thats been stretched, the economies will not return to their previous shapes. Instead, they will evolve to new plateaus.   Without honest reflection, most of us will  not reshape our businesses sufficiently to meet the new world order.

Recently, I have been helping a number of companies to reflect on the year just gone.  With an emphasis on reflection and a factual look at events and results, rather than a process to attribute blame or express regret, we have been working through questions such as these:

• Could we have done better?
• Was an increase in sales of x % enough?
• How could we have better dealt with the GFC?
• Did we push our use of technology ahead enough?
• Did we develop our products and enhance our service enough?
• How could we have delivered better on our brand promise?
• How did we make our profits?
• Did we give people what they wanted?
• What did our people contribute?
• What shape were we in on 1 July 2009?
• What shape are we in now?
• What did we do to improve skills?
• What do we need to stop / start / continue?

Of course, the most important part of this exercise is then deciding to take action and do some things differently in FY11. Fortunately, and despite my feelings to the contrary, I still have 364 days to do just that.

MORE GREAT BLOG POSTS BY JULIE WISE

• Unleash The Plan In Your Head
• Customer Service Tip #1 – Hug your customers!
• Get Ready! The financial year end is on the horizon.

By Alycia Edgar, Coastal Accounting Services

So it’s nearly end of financial year and you start to think, goodness I need to set a budget for next year. But, where to start? It’s quite easy really. The basic template you start with is your current year results. Simply, run a current year profit and loss by month report, export to Excel and you have the beginnings of a new relationship with a budget. Why do I suggest monthly? It is often easier for you to determine next year’s results monthly than a large annual figure. So these current year results are the base of your figures.

Now it’s time to analyse each line to determine whether that figure or higher/lower can be achieved this year. Remember your numbers are determined by the organic nature of your business as well as the strategies you put in place to grow your business.

Here are few questions you can ask yourself, to kick start your analysis:

Sales – So, what is your marketing plan for 2011 financial year?

• What do you predict will happen to sales because of this?
• Do you have any new product or service launches?
• Are you withdrawing products or services from the market?
• Are their client contracts in place that will cease and not be renewed?
• Will you be opening a new store?
• What marketing expenses will be incurred from this plan?

Cost of Sales – Depending on your business structure, your costs of sales (direct costs associated with achieving sales) will move along with any sale increases or decreases.

Expenses – People (salaries and wages)

• Will you require any additional resources to support growth?
• Will there be pay rises?

Expenses – Location

• Will you have any rent increases? New office, new store?

Expenses – telephone & internet

• Are you on the most efficient plan? Are you paying for phone lines no longer being used? Do you need to review your internet usage and existing plan?

And the list can continue…. The questions can be endless, but ultimately it is you who knows your business best and can determine answers to these questions. If you need help, speak with a bookkeeper or accountant, someone that can think a little bit outside the square to where you think, so you don’t miss anything.
By setting up a budget you can then track your progress throughout the year against actual results and see how well you are performing. Great to see if those marketing plan strategies are translating into the budgeted results.

MORE GREAT POSTS BY ALYCIA EDGAR

• Do you have a regular money huddle?
• Maintenance is the key to organised numbers
• Are you avoiding your paperwork?

The latest question from the Ask a Mentor series comes from Ana Lucia Novak.

Question

“What habits should a new business owner form, such as how to manage operations, finances, marketing, networking, and competitors?”

Answer

by Simon Winfield, Planet Wholesome

The answer to this question could be hundreds of pages long, and entail reading a whole library of business books!

Tom Farmer of Kwikfit, a chain of exhaust and tyre fitters started in Edinburgh, Scotland, recounted the real crux of financial control (and operations) as knowing exactly how many car exhausts he needed to sell each day to reach breakeven.

In a sentence this might address ‘operations, finances and marketing’ in your question above.

In order to breakeven, in addition to analysing your operational costs, you will also need to understand your customers, which in turn will lead you to how to market your product.

A stab at a list of habits a new business owner should form would therefore be:

1. Understand the precise cost of making or producing your product or service.
2. Understand the flow of cash within your business, especially the length of time that capital is tied up between buying raw materials and being paid for selling the final product. This will also lead you to a better understanding of the financial needs of your growing business.
3. Research your market by targeting a conversation with a customer every day. People like being asked their opinion.
4. Networking is important, but improve on that by targeting exactly the individual you want to speak with, and plan your route to that individual. Don’t be afraid to pick up the phone to them directly, and ask them to share their expertise with you.
5. Knowing what competitors are doing well, or things they are getting wrong, comes from having conversations with your customers.

By Julie Wise, Silver Owl

Like a lot of  people, you probably have just finished getting your new year resolutions and goals underway so you won’t start reviewing your finances until June starts (some won’t start until after 30 June).

For many SMEs, June is too late to consider the consequences and do anything about it.   In my corporate assignments, the first day of the last quarter signals a quantum increase in the scrutiny of actual vs. budget vs. plans.  That scrutiny takes the form of questions like ‘are you on track?’, ‘what are you doing to stay on track?’, ‘can you go better?’, ‘what risk management plans have you got?’, ‘what are you going to do to make plan?’ etc.

SMEs don’t have finance departments that act the devil’s advocate and your  accountant is going to be in demand so access is going to get difficult.  So WHEN and HOW you start to focus on your business year will make the biggest difference to your bottom line.

Here are some things you could consider starting and doing right now to ensure that the year end process doesn’t give you headaches.  Make sure you get the right professional help with any of these ideas.

Cut-off procedures

When the financial year comes to an end, it is particularly important that you have a proper cut-off point for the company’s operations. Therefore, you should:

• Ensure your suppliers provide you with the relevant invoices for all purchases and expenses for the period up to the end of June.
• Identify your work in progress or sales not yet invoiced and raise the relevant invoices for the period up to June 30th.
• Identify all of the following to confirm that they are correctly recorded:
  • pre-payments received from clients
  • prepaid expenses to suppliers
  • cost accrued for which no invoices will be received before the year end
  • stock levels at the year end for goods or work in progress

Reconciliation with clients and suppliers

It is important that your records, as well as those of your clients and suppliers are accurate, particularly if the transaction needs to be declared as part of a due diligence or compliance process.

• You could ask for extract from their records containing information regarding your joint transactions. This will allow you to compare their records to your own and identify any errors or misstatements.

Profits are Likely

If you’re forecasting a profit, you may want to start thinking about the implications of the result. For example:

• Do you have any past tax losses to be utilised?
• Will your cash flow situation allow you to meet your tax obligations?

You may be able to legitimately reduce your levels of profit by:

• ensuring your accruals are indeed reflected in your results
• incurring extra expenses – especially ones you have been delaying
• identify potential bad debts and make the necessary provisions – if you do write off bad debts don’t forget the GST adjustments
• ensure all of your fixed assets have been depreciated correctly in accordance with tax legislation
• review your list of disallowable expenses. Some of them maybe due to a lack of supporting paperwork. You have time now to put some effort into requesting the full invoices from your suppliers

Losses to date

You’re forecasting a loss for the year so you may want to start thinking about the potential business implications of the result. For example:

• Is this expected because of your business stage?
• If not, can you fix the loss situation for the longer term?
• How strong are your cash reserves?
• Are your creditor levels much greater than your debtors?

You should start reviewing your results in depth with a view to identifying areas of improvement and taking corrective action.

You may be able to legitimately increase your levels of profit by:

• Ensuring any services rendered or goods delivered are invoiced before the year end
• Delaying expenses planned until after the first of July
• Ensure that investment items are capitalised as an asset on the balance sheet rather than treated as current expenses

Once you’ve done this work you need to keep a vigilant eye on your budget and cash flow forecasts over the coming weeks and days.

Plan for next year

Even if all of the above is in good order, these disciplines always help you reflect on your business performance.   Here are some steps you may want to take to improve on your performance:

• Prepare the budget for the coming year
• Review your credit terms with suppliers and customers and make changes if required
• Arrange credit facilities with your bank if you anticipate cash shortages
• Reduce costs on areas identified as excessive in the current year
• Implement new internal control systems to address weaknesses identified

Don’t be an April Fool!

April 1 started the last quarter of the financial year for majority of Australian businesses – that was 5 days ago!  This is the best time to prepare for the end-of-year.

If you missed the recent Money Management for Small Business webinar with Karen Houghton then you missed out on timely, relevant tips and strategies that you can implement in this challenging economic climate to make more of your money and resources. 

Click here to listen to this live recording.

Need some financial help right now? Talk to Karen and her team at MoneyPennys.