Posts filed under ‘Excercises’

SWOT’s It All About? (FREE Download)

Last week, in four parts, we created a SWOT analysis by defining the Strengths, Weaknesses, Opportunities, and  Threats to your business.  One final step is necessary in putting the SWOT information together.  An analysis is only valuable if you put a plan into place. In this last step you will create a list of strategies for your business.  In this last step we’ll take a look at how we can:

  • maximize our strengths to take advantage of opportunities: Strength-Opportunity Strategies (SO Strategies)
  • use our strengths to minimize the threats to our business: Strength-Threat Strategies (ST Strategies)
  • use opportunities to lessen  weaknesses: Weakness-Opportunity Strategies (WO Strategies)
  • mitigate the weaknesses in light of impending threats: Weakness-Threat Strategies (WT Strategies)

Here is a matrix for a Wedding Florist Business to help you see how all of these details fit together:

SWOTMatrix

Here are a few observations:

  • See how we’ve lined up our niche strengths (unique floral design) to take advantage of opportunities (submitting photos to that new magazine)?
  • Notice how we’re beefing up our strengths (strong customer service) to work around the threats (increased competition)?
  • Do you see how we are taking advantage of external opportunities (cost of rent and real estate is dropping) to lessen the weaknesses (high overhead)?
  • Observe how we can mitigate the weaknesses (no blog; start a blog) to adjust for threats (advertising costs are rising)?

In Summary

The SWOT is a very powerful tool in identifying the internal and external factors that affect our business.  I find it useful to do one every 6 months.  Some of the factors don’t always change so a working word or excel document can be helpful in analyzing the constant and/or dynamic aspects of your business.  The final piece, putting a strategy in place, is helpful in determining short and long term goals for your business.  All of the SO, ST, WO, WT strategies can be put into your 1-10 year goal sheet, and into your business plan.

Do you like this? We love feedback… let us know in our SWP Survey.  And, if you love it, feel free to DOWNLOAD this here: SWOTAnalysis.

Here is a matrix for a Wedding Florist Business to help you see how all of these details fit together:

August 10, 2009 at 6:00 am 1 comment

SWOT Analysis: Defining the Threats for your Business

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Today is the T day of our SWOT Analysis.  We have defined the Strengths, Weaknesses, and Opportunities.  Today, we’ll be defining the Threats to our business.  Threats come from outside factors to your business.  It is useful in identifying the threats to your business so that you can be watchful and aware of them.  Knowing your threats will help you make better business decisions.

Take 15-30 minutes today to work on defining the threats to your business.  These are the challenges you will face along the way.  Here are some helpful questions and tips for defining your business threats:

  • Look at the economic, social, and political climate. How can changes in these factors present threats to your business?
  • What is happening within the wedding industry?  Are there changes that could be challenges to your business?
  • Talk about other professionals in your segment (both your competitors, and your non-competitors).  Do they present any threats in market share?
  • Is anything happening locally that could affect your business negatively?  Nationally? Internationally?
  • What are the market trends?  Are they moving with your business or in another direction?
  • Are there any economic factors that affect your suppliers?  How can these factors present a threat to your business?
  • Is your reputation at risk in any way?

Those are some scary questions, aren’t they?  But, it feels better knowing the imminent threats to my business.  It helps me understand where I need to go and how I can change my business to adjust for those threats.

On Monday, we’ll tie it all together.  We’ll take a look at what to do with all this great information.  Come back to the blog tomorrow for another awesome industry insider!

August 6, 2009 at 7:00 am 2 comments

SWOT analysis: Defining the Opportunities for your Business

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This week, we are working on the SWOT analysis for your business.  This exercise will give you a chance, to identify Strengths, Weaknesses, Opportunities, and Threats.  Today, we are going to uncover the opportunities outside of your business.  If you’ll remember from our discussion on Monday, your opportunities and threats come from outside factors affecting your business.

Take 15-30 minutes today to work on defining the opportunities for your business.  These are the “places you will go” and “things you can do” with your business.  Here are some things to think about while working on your opportunities:

  • Look at the economic, social, and political climate.  How can changes in these factors define opportunities for your business?
  • What trends are happening in the market?  How can your business fit into these trends?
  • What opportunities are there within your market segment?  In your local market?  At the national level?
  • What relationships can you build upon?
  • What investments can you build upon?  Investments can be those made into equipments, supplies, inventory – or – advertising, promotion, public relations.
  • Where do you see lemons?  Can you make lemonade?
  • Where do you find a challenge at the consumer level?  Can you create a solution?

Ahhhh… fun!  Are you starting to see it all come together?  Are you starting to be abuzz with ideas?  There’s a whole world out there, and the SWOT Analysis is very helpful in helping you find it.

August 5, 2009 at 6:00 am Leave a comment

SWOT analysis: Defining the Weaknesses of your Business

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This week, we are writing a SWOT analysis.  We are defining the Strengths, Weaknesses, Opportunities and Threats of our Business.  I find this exercise extremely useful in taking the temperature of my business.

Take 15-30 minutes today to write about the weaknesses of your business.  This can be challenging because it forces you to face some of the thoughts you may be avoiding.  Remember that by recognizing your weakness, you can build strength.  Here are some thoughts to help you determine these weaknesses:

  • What are the things holding your business back?  holding you back?
  • What is unhealthy about your business?
  • What are the struggles that your business has and that are difficult to overcome?
  • What are your daily challenges?  your larger challenges?
  • What are your sources of frustration?
  • What negatively impacts your relationships with vendors, clients, and/or employees?

Spend some time dreaming about the things you’d love to improve about your business.  We’ll summarize the entire SWOT analysis at the end of the week.

August 4, 2009 at 6:00 am 2 comments

SWOT Analysis: Defining the Strengths of your Business

This week we are going to do a SWOT Analysis of your business.  This is a helpful tool in which you take a step back to examine key characteristics of your business.  This is a strategic analysis that is done in all businesses of all sizes: small sole proprietorships on up to Fortune 500 organizations.  I encourage all businesses in the wedding industry to do this twice a year. It’s great at quickly assessing:

  • whether you are moving in the right direction or not
  • what is AWESOME about your business
  • what needs to be changed and improved
  • what external factors (trends, economics, politics) affect your business

SWOT Analysis

The SWOT breaks down into two components, of two parts each (four parts total):

Internal Factors:

  • Stengths – the strengths of your business, IN your business
  • Weaknesses – the weaknesses of your business, IN your business

External Factors:

  • Opportunities – opportunities for your business, OUTSIDE of your business
  • Threats – threats for your business, OUTSIDE of your business
Creative Commons License: Xhienne

Creative Commons License: Xhienne

Define the Strengths of your Business

Take 15-30 minutes today to write down the strengths of your business.  Be honest and realistic.  This is to be used to help you make decisions about the health of your organization.  Here are some things to think about when defining your strengths:

  • How is your business different from others?
  • What are the intangible assets (people, experience, knowledge) and tangible assets (office, equipment) that makes your business strong?
  • What do you personally bring to your business?  What do your employees bring?
  • What are some of the achievements your business has had in the last year?
  • How is your business perceived within the wedding industry?  What is its reputation?  What is your reputation?

Hold onto these strengths, we’ll be putting it all together at the end of this week.

August 3, 2009 at 7:00 am 9 comments

Hiring Your First Employee

Over the years, I’ve spoken with a number of small businesses in the wedding industry who are scared of hiring that first person to help them with their business.  Aside from the financial investment it takes to hire an employee, it also takes an investment of your time and energy.  I can proudly say that I have had 5 amazing people work for me in the last 3 years.  And, each one of them has been outstanding.  I would do it all over again

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I hope to share some of my successes in hiring people with you.  This week we are going to talk about taking on that first employee. (If you have already hired a few employees and haven’t had much luck, this week of blog posts may apply to you as well.)  Today, we’ll talk about how to prepare for hiring someone.  Tomorrow, we’ll discuss recruiting (placing your ad.  Wednesday, we’ll talk about resume review.  And, Thursday we’ll wrap it up with a discussion on interviewing

Are you ready to hire?

There are two major considerations to take into account when hiring a new employee.  The first is financial: can you afford this individual?  Here are some thoughts on being financial ready to hire:

– Do you have cash reserves for 3-6 months of your business?  (This would be your emergency savings.)
– Do you feel that your personal financial needs are being taken care of?
– Will the work that this person does enable your business to grow?  (Either they have direct impact on sales or will free you up to increase sales)
– Will this person be full-time or part-time?  Will they be seasonal or year-round?
– Can you afford their payroll and their payroll taxes?  (People always question me on the additional payroll expenses.  For a part-time employee in the state of Washington, the payroll taxes equal ~20% of payroll.  For other states it can be as high as 25-35%.  If you have full time staff and want to offer medical insurance and vacation, this can be even higher.)

The second consideration in hiring someone is whether or not YOU have a commitment to this.  So many people go into hiring an employee with fear and trepidation.  They aren’t sure of the specific training and the specific responsibilities of that employee.  Others don’t truly understand the ongoing mentorship that goes into hiring quality people.  And, there are also a number of small business owners who aren’t ready to give up control.  You must be willing and prepared to surrender.  Allowing your employees to share control of your business makes them invested in your dream.  Without that, you cannot have a successful organization.

What specific role will this person fulfill?

The book that changed my life (and my business) is E-Myth by Michael Gerber.  In it, he discusses how small business owners often burn out after a few years because they are managing so many responsibilities as a small business owner.  Think about your day.  You are the President, CFO, VP Marketing, Sales Manager, Assembly Person, Technical Support, Customer Service, File Clerk, Copy and Coffee Girl, Errand Boy, Janitor, and Dishwasher.

In the E-Myth (Entrepreneurial Myth), Gerber discusses how we must define specific roles in our businesses.  He recommends doing this even if it is just you.  This is important in defining how your company works.  So, try it out: Make a list of every role and responsibility in your organization.  From there, create an organization chart.  Or, if that’s a little daunting, create responsibility lists.  For example a “Sales Manager” would be responsible for responding to client inquiries, setting appointments, meeting with clients, educating clients, writing proposals, and making the sale.

Once you’ve defined these responsibilities, you’ll have a better idea of where you can fit that first employee.  For me, when I made my first hire in 2006, I really needed someone to help me with the hand assembly of wedding invitations.  This person would be my “Assembly Lead”.  I clearly defined the responsibilities and made certain that it fit with the overall structure and strategy of mmm… paper.  This would help me later in placing my employment ad and eventually in training the new hire.

I was also able to crunch some numbers and determine whether her part-time hourly pay fit into my financial plans.  Because her job is part of my cost component of building an invitation, am I appropriately pricing my goods?  Does her pay fall reasonably within my profit margin?  And, does her employment, free me up to work on other revenue building opportunities?

Do you have procedures in place to train and mentor this individual?

So, you are all set.  You can already envision your first employee.  You have already dreamt of how he or she will greet you at the door with coffee.  This person will make all of your entrepreneurial ambitions come true!  (Or maybe, they’ll make it so that you aren’t working until 3am every night.)  But, how are you going to get from A to Z?

I think the largest mistake people make in the road to hiring an employee is not preparing procedures for training this individual ahead of the actual hiring.  Most people think they can wing it.  Or, that they’ll get through the interview process, and then work on the training procedures.  It doesn’t work that way.  You must have an idea of how you are going to train and mentor this individual before you begin recruitment.  It’s an important part of finding the right person.

Here’s why you need to have training procedures in place before hiring… You will find a handful of people in your interviews who can do the job… but, what you need is someone who is eager and willing to learn.  So, you should be looking for someone who can fit into your training plan.  Anyone who is not willing to learn will not embrace your vision.  And, you need to be prepared to teach them.  I recently talked about being a mentor not a manager.  This is most true with that first employee.  You must be prepare to coach them in all there is about your beautiful little business.  This relationship will lead to a mutually beneficial partnership.  By having procedures in place before the hiring process, you are recruiting people who would be good mentees.  You are recruiting individuals who fall in to your training plans, not just someone who fulfills a role in your business.

When I hired my first employee, the following below is what I did to create my training plan.  It worked for me then, and I use it with every new person I hire.  (That’s another great thing about having a training plan, it’s easy to use if your company is seasonal and you need to hire and train people on a frequent basis.)

– Create a list of everything you want to teach that person.  If you can clearly define processes, then it will be easier to communicate what they should be doing.
– Now take a step back: I know you want them to do everything, but stick to the role that you defined for them.  Compare your list to the list of responsibilities that you defined for their position in your company.
– Look at the list again: You’ve listed what’s in it for you… but, what’s in it for them?  What life and careers lessons can you give this individual?  (By emphasizing that you want to give this person training that will be useful for their life-long career, you are building upon that mentor-mentee relationship.  This is important in creating a mutually beneficial partnership.  This isn’t just about you.  Trust me, this will pay off in the long run!)
– Create a schedule of the times you are going to sit with the new hire and teach them these things; allow for “independent study” and “work time”

A question of Your Time vs. Your Commitment

The commitment to take on new employees begins long before you place that first ad.  You have to take a hard look at your business and determine how it is organized and how you foresee the future of your organization.  Training and mentoring do take time.  (I often hear from people that they are scared of taking on employees because “in the time it takes to train and manage someone, I could’ve just done it myself.”)  But, the time it takes is not what you think.  You commit of your time and energy into mentoring the person.  If you do this properly, you will spend far less time managing the person.  If you put in the heavy investment to build that relationship, you will spend far less time training, overseeing and supervising that individual.  And, you’ll have a team of people that love your business nearly as much as you do!

July 27, 2009 at 7:35 am 3 comments

Writing Your Business Plan, Step 9: Financial Plan (Preparation)

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Did you fire up your calculator?  We are going to work through the financial plan.  This is the final segment of your business plan.  HURRAH!  It requires some prep work and is a bit lengthy.  So, we are going to break this down into 3 posts:

  • Preparation (what to prepare before writing the financial plan)
  • History (looking back on the finances of your business)
  • Future (looking forward on the finances of your business)

First: Preparation

The financial portion of your business plan requires some planning and preparation.  Let’s break it all down.  (NOTE:  This is just the summary in preparation for the actual writing of the financial plan which will take place next Monday and Tuesday.)

Soooo… here is what you are going to need to know.  We’ll assemble this into financial statements next week:

  • Assets – what do you own in your business? (computers, inventory, etc.)
  • Liabilities (AKA Debts) – what do you owe in your business?
  • Equity – how much have you invested (or has someone else invested) in your business?
  • Revenues – how much did you make in sales in 2008?  (this can typically come from your tax return)
  • Expenses – how much did you spend in 2008?  (also should be traceable to your tax return)
  • Cash – where is that cash register?  (not the physical register, but that paper thingie that tracks which checks you’ve written)

Spend the weekend putting these numbers together.  Next week, we’ll be putting them into the “magical” financial statements of your business.

Come back tomorrow for a little business plan break.  We’ll be featuring another fab industry insider.

May 21, 2009 at 6:00 am Leave a comment

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