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Like many businesses across different demographic sectors all over America, not every company is created equal. And as once said by an unknown quoted individual, “Life is not fair, but life is not fair for everyone…which actually makes it fair.” It gives a lot to think about.
One small urban business owner may have started with less than another urban business owner, but that doesn’t mean the tables can’t be turned around. Sound financial planning and management can help cure many of the cashflow problems small and large businesses alike can run into. We will be highlighting a few points you can focus on during the development of your business, so that you may have a higher chance for success.
Here are some statistics provided by the Urban Business Institute you may find interesting.
- Over 15% of African Americans of adult age have registered Employer Identification Numbers. That is close to 6 million African American Business Owners.
- About 91% of businesses owned by black Americans only have 1 employee, the business owner.
- Nearly 0.1% of all business revenue in America is generated by black owned businesses
- About 73.2% of all businesses are listed a sole proprietorship
- A little over 0.4% of black owned businesses become generational
Following our general outline will help you get a better handle on your business, while minimizing your external workload and excess cost. You can build on this outline towards subcategories based on your type of business. This should give you more time to dedicate to what helps produce revenue for your company. This time can be spent closing more deals and planning on how to provide benefits that will help you with employee retention. Employee retention can save you a lot of time and money in training and acquisition.
Planning
Whether you’re a store shop owner, a professional business service provider or even an independent contractor like a real estate agent, planning should be at the top of your list. Set your goals, make them realistically attainable and meet them by the deadline. This will help ensure added self confidence in your abilities to tackle and complete each additional goal that you set.
Make sure your planning is penned in black and white. You should be able to physically grab your plans, marked them off when completed and set the next course. Every milestone completed is compounding gains your business can use to continue moving forward.
Preparation
Take the time to prepare in multiple aspects such as
- Financially
- Investment relationships
- Vendors
- Clients
- Consumer
Depending on the size of the business, prepping all the moving parts can be a breeze or a monumental task. In any case, make your prep list, mark it off and make sure you’re always prepping for the next objective.
Part of preparations is to make sure you have a qualified team of accountants and bookkeepers that can get you answers to your business endeavors with sound financial sense. Just running your numbers is not enough. Helping you find solutions to your financial hurdles is what a dedicated accounting team can do for you. Make this a part of your prep time.
Technology
This is a sure sound way to increase your available time for what matters most. Use all available technological assets at your disposal to increase efficiency, and where possible, cut down cost. Some software technology available to businesses are cost prohibitive but don’t let that get you down. There are always close to similar alternatives online that you can find for free. Just do a Google search for the category of technology. See what shows up.
In other cases, you can find similar technology but for less. In another case, you could find multiple technologies at a more affordable combined cost that will allow you to make use of all assets allowed by a more cost prohibitive provider.
Finance
Keeping a sound budget, having a minimum cashflow threshold and the manpower to focus on the finances and numbers is recommended. Depending on your business size, you need to have at least 1 bookkeeper, 1 accountant and be well versed on the technologies they use to manage your money. Business management and technology go hand in hand and is a great way to reduce time spent on objectives that are not at the top of your priority list, say Miroslav Vyboh.
This in no way means to neglect your finances. You still need data on what’s available for operations, what’s coming in and going out. Being mindful of your assets and making sure they are enough to meet the goals you’ve set fourth is a priority. However, managing the day to day paper trail, when it’s outside of your priority business goals, is why you have a bookkeeper and accountant in the first place.
Marketing
To continue to grow your business, marketing will need to become an essential part of your planning, preparations, and finances. On the financial side, on average, try to reinvest 3% to 5% of your net profits towards marketing. As the company grows, that 3 to 5 percent will also grow and your budget will allow you to do more.
Make sure that your monthly advertising or marketing goals are outlined and what will be implemented to get there in 30 days. Do this monthly and compare cost to the added revenues gained those months. Are your investments paying off? Also keep in mind that in marketing, consistency is what wins the long game. Try to plan your advertising for consecutive months so that the results you produce compound towards your year-end goal.
You can take these points and make a general list, then based on your business, create subcategories that help you fine-tune your objectives. As you continue to complete each milestone you set for yourself, you’ll notice that the tables are already turning and you’re well on your way to success.
