Today I was speaking to a long time friend of mine, who happens to be an accountant (CPA) and all around guru in business finances and taxes.
In listening to him, I was reminded that no matter how much technology you purchase and how well you implement it in your business, you need the basics of business properly implemented first.
Cash flow. Sales. Marketing. Employees. Location. Business Processes.
All of these things and more are important than technology. In fact you can use technology to do these things better, faster and smarter. But the fundamentals of each of these things is not anchored in technology. Things my other good friend Marian Banker coaches on all the time, that Rob Levin’s New York Enterprise Report and Inc Magazine write about all the time.
Thinking about Inc Magazine my favorite column is Street Smarts the one with the wisdom of Norm Brodsky and co-authored with Bo Burlingham.
Their new book THE KNACK: How Street-Smart Entrepreneurs Learn to Handle Whatever Comes Up is filled with insight from Norm and I really think is an absolutely must read.
Norm Brodsky is the founder of CitiStorage and seven previous start-ups, he’s a three-time Inc. 500 honoree. He began writing his monthly Inc. column (with Bo) in 1995 and he has a LOT of wisdom that I’ve personally benefited from over the years.
Bo Burlingham, who I met for the first time last week is Inc.’s editor at large. He is the author of Small Giants, which was a finalist for the Financial Times/Goldman Sachs Business Book of the Year Award.
So kind of of advice will you pick up from the book?
- Control the sales mentality and balance it with a business mentality before it’s too late.
- Learn to anticipate and recognize the changes in your business by developing a good feel for the numbers.
- It’s good to have a lot of competitors because educating a market is a very expensive proposition.
- The first business plan should be simple, and you should write it for yourself, not for potential investors.
- Before you ask people for money, make sure you know how much they like to invest and what they’re looking for.
- Start early to build a relationship with a commercial banker and use an asset-based lender only if you can’t get the money you need from a commercial bank.
- Whenever you launch a new business, keep track of your monthly sales and gross margins by hand until you have a good feel for them.
- More sales usually mean less cash flow. Figure out your future cash needs while you still have time to address them.
- You probably won’t discover your company’s niche until after you’ve launched the business.
- You’re better off with a base of many small customers than with a few large ones.
- Beware of the rules you make. They may inadvertently force your employees to provide poor service to customers.
- Growing a business is a matter of choice. Before deciding to grow, make sure you know why you’re doing it.
- Your company’s culture can be your most powerful tool for finding and keeping great employees. Don’t miss the opportunities to shape it that arise everyday.
- The one thing you can’t delegate is the responsibility for making sure the company has a single culture, not several competing ones.
- Expenses have a natural tendency to creep up over time. If you want to control them, you need to get everyone involved in the effort.
- Look for opportunities to send the message to employees that you really care about them, and that you want them to care about keeping costs down.
- Sales commissions cause divisions in a company and get in the way of building a team. Don’t pay on commission unless you have to, and switch to salary plus bonus as soon as you can.
- Accountants are good for explaining what has happened in the past, but don’t go to them for business advice. Talk to an experienced business owner instead.
- If you want salespeople to make good sales, teach them how your business makes money.