26th April 2011 
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Dear Jeremy How can we improve our business performance? Part 2
Last month we described in detail the need to: Review every aspect of one’s business Take remedial action where performance has not met expectations or an investment has not paid off. Understand which customers are profitable and look to do more business with them. Make unprofitable customers profitable - and if not decide how to deal with them. Consider doing things differently
This month as promised we will deal with the remaining points: Be “fit “enough to cope with an increase in business Tune the finances and possibly secure more working capital or longer term finance to fund new processes or business assets. Remember that “Fit” also includes how effectively the business (and its owner) is working too! Look at where you want your business to get to during the year ahead Consider how you will achieve this
There is of course no one correct answer for every business and each is as individual as its owner. But, and this is a big but, most business issues are generic so here are a few ideas to chew over. With luck they will trigger some positive thinking and this will be good news for all our readers. Feedback is, of course, always welcome. Be “fit “enough to cope with an increase in business: In some sectors, notably residential and nursing homes there are strict regulations covering how many care / nursing staff are required for any given number of service users. This means that if you have the minimum number of users in a particular band it is difficult to be profitable because the staff required is sufficient to cope with rather more. In most businesses this will not apply. However if every member of staff and all resources are fully stretched all the time at one level of trading it is likely to be difficult to cope with more. This also raises the prospect that where new customers are gained existing ones are lost through subsequent poor service. And if you lose the new customer as well then the business has gone backwards rather than forwards!
Tune the finances and possibly secure more working capital or longer term finance to fund new processes or business assets: Tuning a piano is a process carried out in a sensitive way- even if the piano is rather out of tune and so this should be in tuning a business’s finance. It is not necessarily a good idea to turn everything upside down and people may not like it. However for those businesses buying and selling on credit it is surprising just how much can be achieved through better control of debtors (the people who owe you money) and creditors (those you owe money to). If your terms allow a customer 30 days credit and your average debtor days outstanding are 60 days then you are effectively giving twice the credit you set out to. Imagine what would happen if you were able to increase your sales by 25%! If you can collect debtors in quicker this might let you take advantage of some trade discounts for paying early yourself. Imagine if you sell goods with a mark up of 10% but could get an extra 2.5% through earlier payment- this would increase your mark up by a quarter! Jeremy spoke recently at an events sector networking event where one of the questions asked was around making sure you are paid. For many businesses it is the norm to be paid in full on receipt of an order. For others 50% up front plus any materials is easily achieved. If finance is always tight and you operate on an overdraft consider sales ledger finance as an option. This will normally represent a larger proportion of debtors (subject to the type of trade) to an overdraft. If a limitation on expansion is a production bottleneck consider whether new/ better equipment would help and consider long term finance to fund this and the necessary training and other implementation costs.
Remember that “Fit” also includes how effectively the business (and its owner) is working too! Well organised “just in time” processes can work well but “done by the skin of our teeth” is not a recipe for long term success especially if expansion is the aim. Sometimes the difficulty is in moving from systems that one is comfortable with and served well in the past with smaller numbers of people. Imagine using separate paper diaries to organise a team of ten – but with two or three it’s no problem. With a widely spread sales force for example if all communication is through a full weekly meeting there is time lost and cost of meeting and travel time. Perhaps a weekly conference call and monthly meeting would be just as effective- and result in more sales? In most businesses most people work well and are conscientious. However there are often some who are not and managing their performance so that they become more effective and avoid being a constant source of irritation to their co workers (or leave) is important- but no-one ever said it would be easy. The business owner’s habits can be critical and their leadership style is important. Start the day with a prioritised to do list, allocating time for tasks just as you would for a meeting. Avoid doing things that others can do for you or which distract from your core role Consider outsourcing non core activities Make sure employees have a proper job specification and that they agree with it and understand it Ensure that new employees receive appropriate induction training Delegate authority-do not abdicate it Plan how to deal with absence try to ensure that each person can cover more than one role
Look at where you want your business to get to during the year ahead Some sort of planning is always appropriate. Ideally you should have a game plan that identifies where you are now and where you want to be over time. For some this might be planning to be able to take more income for a family wedding or a child going through university. For others it might be looking to retire and sell their business or simply to be able to work fewer days or hours on a weekly basis. What progress do you want or need to make during the year? Looking at what you want from this point of view will help to inform the changes that may need to be made. For example if selling the business is the aim then it needs to be scalable and saleable. The first is achieved by ensuring that all aspects of the business run in such a way that it can deal with more business and take on more staff in clearly defined roles. The second is about ensuring that the business can run effectively without the owner. This normally means growing the management capability and reducing the day to day input of the owner
Consider how you will achieve this Here is where detailed planning can be invaluable. Why? Because everything affects everything else! We need to understand how changing one aspect in detail will need to be addressed and what impact that will have on other areas of the business. The cost of change has to be thought through, in terms of money and time. For example it is easy to say we will train Fred or Sophie to do x. We need to understand the time that will be needed for on site or off site training, the cost of this, the cost of any additional or different kit that may be needed for them to do x in the future and also how to carry on doing whatever it is they do while they are being trained. Of course if all we are talking about is two hours training on site then this is probably not a big deal but if it is a week away than the effect will be much greater. If you are looking to change IT or production systems and this will result in lost production time then is it possible to work extra shifts before and after the changeover to compensate?
If you have any questions, want to talk through your ideas, or want some help in looking at any of the above issues please call SatNav4Business on 0845 468 1 468, email success@SatNav4Business.com or complete the contact form at www.SatNav4Business.com As ever we provide an initial meeting (virtual face to face depending on timing etc) of an hour for Newsletter readers - thirty minutes for everyone else. |
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News from SatNav4Business Steve Mathews Joins SatNav4Business
We extend a warm welcome to Steve Mathews who joins Jeremy and Jerry at SatNav4Business. Steve is particularly well known in the London Boroughs of Hounslow, Richmond, Merton and Wandsworth where he has been active in delivering publicly funded business improvement and finance programmes in the SME market for the last eight years. He has a strong international blue chip background working in a wide variety of roles and organizations. As a result he is able to combine strong commercial and marketing skills to assist clients achieve their personal and business goals. An MBA background from a top 5 business school completes a rounded and pragmatic business approach to his style. Jeremy Webb nominated in Best Professional Adviser/ Consultant category in Leatherhead Business Awards No he did not nominate himself - nor did he win but it was great to be nominated. Congratulations to Menzies who were the winners and to Angela Marshall- Appearance Management who was runner up. Congratulations too to all the other winners-details can be found at: www.leatherheadchamber.co.uk This month’s Special Offers: A FREE ONE TO ONE BUSINESS PLANNING SUPPORT MEETING where we will: - help you kick-start your planning process
- provide you with the tools and information needed to complete your plan
- provide an independent review of your partially completed/completed plan -
Or
A FREE ONE TO ONE REVIEW OF YOUR CUSTOMER ACQUISITION STRATEGY where we will: - help you assess who your target market is
- discuss how you acquire new customers
- help you consider additional activities you could use to achieve this
- review how you store and use prospect and customer information
If you would like to chat through your thoughts, call us for a free meeting or call of up to one hour for Newsletter readers (usually up to half an hour) on 0845 468 1 468 or email us on:
jeremy.webb@SatNav4Business.com or jerry.irving@Satnav4Business.com
We hope to see or hear from you soon Jeremy, Jerry and Steve Wherever you are on your business journey SatNav4Business can help you to arrive at your chosen destination! From free downloads. Fact sheets, guides, reviews and online support to workshops and in depth face to face bespoke solutions, the choice is YOURS... |
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| Surrey IoD Reigate Breakfast Club Friday 6th May 07.00 for 7.20-8.59 Bridge House Hotel, Reigate Hill, Reigate ,Surrey RH22 9RP
“Playing to the strengths in a really effective board” This is a spin off from the Guildford breakfast Club where there is always a discussion topic and this makes the 8.59 Club quite different from many other events. Try it and see!
Members £15+VAT Non Members £25.00+VAT. Book on 02380 266548 (members can also book at www.iod.com )
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Institute of Directors West Thames Branch My IoD Networking Club Tuesday 10th May - 18:30 to 20:30
The Canbury Arms 44 Canbury Park Road, Kingston KT2 6LQ –
The My IoD networking event really is one of the joys of spring, not to be missed. Our evenings at the Canbury Arms, Kingston are always popular (something to do with the imaginative nibbles) and invariably productive. Members £8.50 + VAT Non Members £13.00 + VAT
To book or to find out more or call Denise Jones, Branch Administrator on 07584 657 576 or email her at: admin.westthames@iod.net
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Kingston Chamber Networking Breakfast Thursday 12th May 08.00-09.30 This month’s breakfast is at Carluccio’s, Charter Quay, Kingston KT1 1HT. Come and meet fellow members and representatives of the Chamber board for some serious networking. Bring plenty of business cards; drop one into the prize draw and win the chance to present your business in the minute to win it draw! Contact Wanda on 020 8541 4441 for further details and to book or go to www.kingstonchamber.co.uk and book on line. Members £20 Non Members £30.
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Institute of Directors Surrey Branch Reigate PubHub Thursday 12th May 18.00-20.00 The previous informal get togethers in Guildford and Dorking were most successful and the idea is to offer a monthly opportunity for informal networking across the branch catchment area.
Come and unwind after work and enjoy a relaxing drink at the lack Horse, 93 West Street, Reigate, RH2 9JZ. Free event, cash bar, no need to book
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Surrey Chambers East Surrey Business Breakfast Tuesday 17th May 08.30-09.30 Epsom Golf Club, Longdown Lane South, Epsom KT17 4JR. Come and join in at these regular informal breakfasts. There are no speakers, they are designed to give you a regular opportunity to meet and discuss local issues and widen your own network of customers, suppliers, neighbours and competitors.
It’s a great way to start the day, meet new people and get well fed into the bargain Members £14, Non Members £22 book at www.surreychambers.co.uk
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IoD Surrey and Sussex - The Economy- How is this affecting you and what’s next? Tuesday
17th May 2011 6pm – 9pm.
Canon (UK) Ltd, Woodhatch, Cockshot Hill, Reigate, Surrey, RH2 8BF Come along to the Canon Headquarters in Reigate for this very prestigious event, involving two of the country’s leading and renowned economists – Trevor Williams, Chief Economist of Lloyds TSB Corporate Markets and the IoD’s very own Graeme Leach.
Given the challenging state of the economies across the world and the fact that we seem to be bumping in and out of recession, we remain in interesting times.
Get a comprehensive view of what’s going on, where we have been, where we may think we are and what the future holds. There will be plenty of opportunity to ask those pointed, probing questions, so look forward to a lively, humorous and interactive evening.
This is a Member Only Event but members are encouraged to bring along a guest who they feel might benefit from joining this dynamic evening.
A light buffet and drinks will be served. Price: £25.00 + VAT Book on 02380 266548 (members can also book at www.iod.com ) --------------O-------------- |
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Surrey Chambers Elmbridge Business Breakfast Club Thursday 19th May 07.30-09.00
Hilton Hotel, Seven Hills Road South, Cobham KT11 1EW. Members £14, Non Members £22. Book on line at www.surreychambers.co.uk for further info see entry above for Epsom event.
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Wandsworth Chamber “Selling to the Council Guide” Thursday 19th May 5.00-7.00pm. Wandsworth Museum West Hill SW18 1RZ Learn about Wandsworth Council’s Procurement Process To find out more or book go to: http://www.wandsworthchamber.org/ UpcomingEvents.aspx
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IoD Surrey East meets West Tuesday, May 24 19:00 – 22:30
Denbies Wine Estate, London Road, Dorking, RH5 6AA Price: £39.00 (Inc. VAT) The opportunity to bring together the whole of Surrey in a single IoD region offers tremendous scope to our members to meet new contacts and continue to grow our businesses. When you consider the strength of the businesses in the East and West of Surrey, then combining into one region will offer a wealth of opportunities – opportunities that you don’t want to miss out on!
To really underline the East meets West theme, we are holding the event at Denbies Wine Estate – the midway point between the two old regions. You’ll be welcomed with a drink of wine direct from the local Vineyard, before taking your seats to enjoy a nice meal under the expert guidance of your ‘Table Host’.
During the course of the evening, you’ll be given the opportunity to explain what your business does, and understand what every other business needs – without the need for public speaking, or speed networking. It will all be done in the relaxed and friendly style that you’re familiar with from the IoD. We expect this to be a hugely popular event – so reserve your place today. Book on 02380 266548 (members can also book at www.iod.com )
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Surrey IoD Guildford Breakfast Club Friday 27th May 07.00 for 7.20-8.59 Guildford Cathedral Refectory “The special jobs of Trustees and Non Executive Directors”
There is always a discussion topic and this makes the 8.59 Club quite different from many other events. Try it and see!
Members £15+VAT Non Members £25.00+VAT. Book on 02380 266548 (members can also book at www.iod.com )
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