The Relationship with Your Bank

Banking Relationships – Are You in Love with Your Banker?

There is a series of television commercials wherein one of the characters says how much he or she loves his/her bank. They are humorous commercials - humorous because they are kind of over the top. Love your bank?? They are humorous because they are absurd. Love your bank???

Those of us unaffiliated with any banking institution (be it professionally or through family ties) rarely work up to that level of affection for our bank and banker. But in reality, that is a shame, and not so absurd.

Think about it. If you are a small business owner, your banker has played a role in starting, maintaining, and protecting your livelihood. In a perfect world, the financing your banker has done for you over the years inspires something in you close to love. And with this kind of relationship, you can go to your banker and discuss any financial challenges you might be experiencing or anticipating, rather than waiting for your annoyed banker to contact you when you've been repeatedly late with payments. It may not exactly be romance, but this kind of corporate love has benefited many businesses, and many banks, over the years.

However, what if the day comes when the spark is no longer there? Maybe your banker retires, and the new guy who took over doesn't really “get” you or your business. Maybe the personal attention you used to get doesn't seem so personal any more. The magic is gone.

It is okay to look around for other options. In fact, I would say you owe it to yourself and your business to look at other options. Think of it this way: banks are in business to serve you – you are not in business to be beholden to any bank! So if your banker is not showing you enough love, there are other suitors out there. Just do your due diligence, because, as you know, all that glitters is not gold.

Explore your options, and find a banking relationship that you love. You, and your business, are worth it!

Spring Cleaning Your Business

Many of us recall a time in our lives when "Spring Cleaning" meant a weekend full of family chores designed to put winter and its necessary tools away, and to bring out the implements of spring and summer. It was a good time to open the windows and sweep out the dust accumulated over a long cold winter, not to mention getting rid of things that were worn out or broken, or shop worn. Hey, guess what... not only is this still a good practice for your home, but it may apply to your business as well.

Spring Cleaning Your Products / Services

You know your business. You know what sells, and doesn’t sell. So why are you still offering products or services that aren't selling? Are they still relevant in the market? If not, get out the broom and sweep!

Use your time wisely. The time you waste trying to sell something nobody wants is time you could have been selling them something they want and need. The decision to stop offering a product or service is sometimes an emotional one, especially if it is one that put you on the map. But business sense dictates that you keep your inventory fresh and relevant at all times.

Spring Cleaning Your Clients

The old axiom about 80% of your business coming from 20% of your customers is never exactly accurate. But it is usually close enough to make a legitimate point. The point is, there are approximately 20% of your customers that you want to take special care of - make sure you do that! That is the customer segment that usually deserves the bulk of your attention. But in reality, who always seems to get most of your attention? It's the unpleasant, once-in-a-blue-moon, never-satisfied, slow-to-pay guy that you took on as a favor years ago. You know what? It may be time to sweep him out, too. The time you spend on this guy can be used instead with more interesting and profitable customers and prospects.

Spring Cleaning Your Employees / Associates

It is always difficult to view personal relationships through the cold logical eye of business. Yet it happens that there are people who may no longer be benefitting you businesswise. Maybe someone on your team hasn't fully bought into the program; perhaps someone has resisted newer technology. Maybe you make it an annual practice to terminate the lowest-performing 10% in your organization. Your business is trying to move forward, and maybe there is a person who is holding back. Maybe your business would move faster without the resistance. Time for spring cleaning!

As the economy strengthens, your road to financial recovery is tough enough. You don’t want to be carrying extra, non-essential baggage of any kind. Open those windows, and find that broom. You’ve got some spring cleaning to do!

The Importance of an Advisory Board

Article Comment: Advisory Board Tips

Check out this article "Tips for Creating an Advisory Board" from the FOX Small Business Center. http://tiny.cc/l0mp5

I agree entirely with the author on Boards of Advisors with one exception; I do not agree that members of the board should be expected to work for free. I think that there should be a board fee paid for each meeting and any extra work that they do. It may not be much, perhaps $500.00 per meeting. Without a fee being paid, you frequently just get what you pay for.

Top 10 Resolutions for a Family/Privately Owned Business

Making New Year's resolutions are always a good idea. However, most of the time breaking them is just as easy as making them. I have read where up to 90% of all resolutions fail. However, there is no reason for this to happen. What it requires is discipline, commitment and resolve.

I will attempt to list the resolutions in categories with a short commentary as to the importance of each:

1.) Finance:
Do you create annual budgets? If not, you are missing a great opportunity to look at your business. The list of advantages is just too long. If you don't do it your competitor(s) probably do!

2.) Review your financial results:
You can see lots of trends and give yourself the opportunity to make adjustments and changes.

3.) Inventory:
When was the last time you really checked your inventory for obsolescence? There is lots of money on those shelves that I am sure could be put to better use than just sitting there in the form of unsaleable product.

4.) Your Banker:
In my opinion it is a very good idea to be proactive with your banker. Invite him/her for lunch and give an update as to what is happening in your business/industry. This goes a long way in a relationship especially if you run into a rough patch.

5.) Strategic Planning:
Do you do Strategic Planning now? If so, great! If you don't you should give it serious consideration. It really helps in looking at your business into the future. It requires looking at your competitors and what they are doing. What your product lines/services are offering your customers, or not. When was the last time you asked a customer what he/she wants, and how are we doing in providing it? It gives you a road map into the future. It requires including your managers so that they take ownership to it. Strategic Planning is essential to make you a better competitor on today's marketplace.

6.) Management by Objective:
This is a great tool to get all of your employees on the same page. Each individual, each unit and the company as a whole will all be working in the same direction to reach the stated goals. If the goals are reached everyone shares in the success. If the goals are not attained everyone shares in the failure. Great way to create an atmosphere of TEAMWORK!

7.) Social Media:
This is the hottest marketing tool in the new decade. If you don't have a website get one now! If you haven't updated your website lately do it! Are you on Facebook? You Tube? Twitter? LinkedIn? If not, you had better learn about it before your competitors do. It will put you at a distinctive disadvantage of you don't.

8.) Board of Advisers:
For many family or privately held businesses the thought of having outsiders look at your confidential information is just not an option. Wrong! It could be the best thing you have ever done. I didn't do it and I still regret it 20 years later. Outsiders look at your business differently. They would give a fresh perspective and make you look at your business differently as well.

9.) Management Meetings:
Commit to monthly management meetings. Schedule the same time every month so everyone knows where they will be at a certain date and time. Have an agenda and give everyone a little homework. Works great.

10.) Communicate:
Maintain two way communications with your employees and your employees to you. This will create an atmosphere of working together and giving your employees an opportunity to let you know how they feel, make constructive suggestions, etc.

And here is a BONUS resolution:

11.) Visit Your Customers

The best way to learn about what customers want is to ask them. When I would do store visits, I always introduced myself to customers and asked what they liked and didn't liked; what merchandise they would like to see in the store; and ask about any service improvements we need to make. Whenever a customer took the time to call the office to complain, my policy was that all those calls were put through directly to me. The customer always appreciated this - and I made sure that the problems or issues were addressed immediately. You need an unfiltered link with the customer - so you have a direct view of a customer's needs, wants and desires. This can be applied to any type of business.

That's it! Simple isn't it? I am sure you may be doing many of these things already. Try doing them all. It can only make your company better and more competitive.

Have a Happy, Healthy and Prosperous New Year.