GlobalBX

Strategic Planning for Owners and Managers

All companies are facing challenges as the country faces the most serious economic times in recent history.

Take time now to sit down with your team. For large companies, this might mean your department heads and partners; for smaller companies, your bookkeeper, and your salesperson. Don’t forget outside advisers – your accountant, lawyer, insurance and benefit agent, financial planner and possibly your banker. And don’t forget your family; what affects the business effects you and your family.

A few things to consider:
 

Employees are either part of the solution or part of the problem.  If certain employees are part of the problem, you are better off without them. Reassess your need for all the employees you have; don’t keep all your employees because you’re trying to be a nice guy. If you don’t reduce a few, it could lead to everyone being out of a job.

As for salespeople, be sure your compensation program is fair to both the company and salespeople. Some commission structures generously compensate the salesperson, but short the company. If it isn’t a win for both sides, it doesn’t work.
             

Use financial statements and your bank as helpful tools. Don’t produce financials to put them in a drawer, or because you must have them for the bank. If you don’t understand your financials, sit down with an accountant and learn how they can help you manage your business. If you’re not sure your financial statements are credible, consider asking a third party – someone other than your accountant – to verify them.

Meet with your bank to ensure they are solid, and that they aren’t thinking your company would be better elsewhere. Ask your bank to send account managers to your plant once in a while so they can understand your business better.
         

Reduce waste and excess. Utilize your employees to help cut costs and seek opportunities. Give them incentives to reduce waste. Enlist them to look for and suggest ways to do a project better, with fewer people and less waste.

Look at trimming down benefits or having employees pay more. Sell excess equipment and reduce inventory. Even if the used equipment market isn’t great, something is better than nothing, and selling will free up space and cash. Give customers a special price on older or outdated inventory.
        

Consider your customers. Not all customers add value; it can help the business to weed out those customers, leaving more time to work on projects for customers who add value and pay on time.

Determine your top customers, based on profitability, and meet with them to emphasize how much you appreciate there business and determine how you can be a better solution provider for them. Be creative and think outside the box – the idea is to add more value for these important customers.