Addendum to previous posting....

Following on from my previous blog '10 tips for business survival' I would like to add an eleventh tip (kindly provided by a reader of the post in question);

11.  In the good times spend money as if we were in a recession, so that when the recession comes, you are prepared and will not have to make huge cuts to carry on being successful

I hope that this additional tip will prove to be useful to you

As always, if you have a business challenge and need some help - call us on 084 3289 3288 or email one of the team at enquiries@blueboxconsultancy.com

We look forward to hearing from you soon

Until then, very best wishes for 2014

10 tips for business survival

     In tough economic times often business emphasis is on survival rather than growing the business.  In this article we are offering businesses our 10 top tips for business survival:

1. Cash flow is king - having a healthy cash flow and managing it competently are the life blood of any fit business 

2.  Avoid under-pricing -  rebuilding margins is as important to recovery as rebuilding sales.  Getting prices right in the first instance will ensure that you are not in a situation where you have to explain to your customers why you are putting up your prices 

3. Invest wisely in people and systems and ensure you receive an adequate return on the investment

4. Cost control and cost reductions should be maintained during a recession and recovery

5. Establish a long-term marketing strategy backed by a consistent marketing budget

6. Beware of over-trading – don’t take on more orders without being sure of the working capital to process them

7. Growth should be driven by judicious planning rather just the enthusiasm to do more business

8.  Capitalising growth from a company’s own resource can drain it of cash – consider funding against existing sales through factoring or some other form of finance

9.  Be aware of the need for capital sufficiency: reduce your debt burden at both ends, what you owe as well as what you are owed

10.Credit check your potential customers to avoid being hit by  bad debt - set a credit limit for all customers and never exceed  it

    If you would like more information about how to maximise your business whilst minimising your risk, call Neil Todd at Blue Box on 084 3289 3288

HOW TO MAKE UNHAPPY CUSTOMERS HAPPY

The customer is not always right, but the customer is ALWAYS the customer

It is a fact of business life (and indeed a fact of life in general) that customers have a tendency to complain – even if there is not a lot to complain about – This is bad, isn’t it?  Well, not necessarily.  A customer complaint is an opportunity (albeit, disguised, but an opportunity nonetheless)

If a customer complains you have an opportunity to do something about it.  As many as 95% of customers would just take their custom elsewhere – and you would be left wondering what went wrong.  So, instead of griping about a customer complaint – rejoice in the opportunity! View each complaint as ‘’free consultancy’, fix the problems that they have identified and grow stronger as a result.  Not acting upon customer feedback – and in particular, complaints – in this age of social media, would be a very brave (but foolish) thing to do.  News, and especially bad news, can spread like wild fire.  Social media channels can reach thousands or even tens of thousands of people (your customers included) in seconds and can be relayed across the world in (almost) the blink of an eye

There are few things more disheartening for a small business owner than being asked for a refund because your customer is dissatisfied with your product or service – but refusing to honour your commitments is tantamount to business suicide – word will spread, ill feeling will be created and havoc will be wreaked!

However, the majority of complaints do not necessarily stem from a problem with your product or service at all – instead the issue lies with the customer themselves – they have suffered from ‘buyers regret’ which is often heightened with the size of the purchase

So, what can you do about a customer who feels a sudden regret about making a substantial purchase? Reinforcing their decision with positive actions is one of the ways in which you can reassure your customers that their decision was correct in the first place.  You can do this by sending a personalised note to each purchaser shortly after their order arrives, by giving them a call, or by sending a thank you note in with their order

Now, strictly speaking, buyers regret is NOT a genuine reason for returning goods (according to the Sale of Goods Act 1979) and herein lies the dilemma – if you have a customer who is truly dissatisfied with the goods or service that you have provided, but your goods and services are not faulty and are as described, do you offer a refund for the sake of goodwill?

What action you take will depend entirely upon you, your relationship with the particular customer, and your policy on returns and refunds – but remember, whatever you do is likely to change or reinforce the opinion that your customer has about you and your business

10 things you could do to keep your customers happy (and therefore keep them coming back);

1.      Be better than your competition

2.      Set the standard for customer service – do just be as good as the best in your sector, be better than the best in an any sector

3.      Identify when things go wrong, admit your failings – learn from them both and move forward

4.      Listen to your customers

5.      Listen to other peoples customers

6.      Understand your customers, their preferences and habits – and reflect these in your service

7.      Personalise your customer experiences

8.      Walk in your customers shoes – what is it like to be a customer of your business; what are the good points and what are the bad

9.      Tell the world about your service

10.   Get your customers to WANT to tell the world about your service

If you want to improve your customer experiences, you can contact Blue Box by;

Email:  info@blueboxconsultancy.com or by calling 084 3289 3288

We look forward to speaking to you soon!

ISO9001 - the new,cool kid on the block?

You don't need me to tell you that we are living through the worst recession in most people memories.  In tough times, businesses have 2 choices:-

1. Hunker down, conserve resources and hopefully come out of the other side

2.  Find a way to differentiate your business from the competition, become more efficient and competitive and come out fighting

For businesses that have chosen option 2, there are a couple of pieces of good news:

The first one is that help is on hand.  Help to make you more profitable, help to win you more customers, and help to make you stand out from the crowd.

We will come back to the second piece of good news in a moment, but let us just focus on the first for just a second longer…

This help comes in possibly one of the most surprising forms – ISO9001:2008!

The British Standard synonymous with Quality Management is enjoying somewhat of a renaissance of late.  This is due, in part, to businesses looking for new, cost-effective ways to set themselves apart from their competition.

In certain circles ISO9000 certification is nothing new – if you regularly supply to the Public sector or if you are part of the supply chains for some of the automotive manufacturers in Europe then this will be fairly common place – but for other industries it is relatively un-chartered territory.

So, herein lies the opportunity – if you want to set yourself apart from your competition, if you want to demonstrate to the world that you are a supplier who can work to the highest standards, if you want to invest in your people and processes, if you want to win new work (a survey in 2011 carried out by the British Assessment Bureau found that 44% of ISO certified companies were winning new and better work) then maybe ISO9000 is for you

And now, back to the second piece of good news;

There are currently schemes available to support the design and implementation of ISO9000 – and by support, I mean financial support, up to 40% of the value of the project (covering the writing of the processes and procedures, preparing the business for the implementation, training staff and also the initial inspection costs)

So, what are you waiting for?  Take the first steps to setting your business apart from the competition today – by calling Blue Box Management Consultants for a no-obligation chat through the options around ISO9000 and the funding that is available.

Blue Box are currently working with a number of clients to help improve their processes and procedures, helping them to become and remain more competitive and profitable, and to win and retain new clients.

Call us on 084 3289 3288 or email info@blueboxconsultancy.com

Is now the right time to develop and grow your business?

Is now the right time to develop your business?

Introduction

We have been in the grips of economic recession for longer than most people care to remember; it feels like we have known nothing else.  Although key economic indicators have previously suggested that the crisis situation we find ourselves in would soon improve, so far there is no end in sight.

Although it has been a difficult time for many businesses, it is worth asking the question; is now the time to reflect on what might have been, or instead to seize the opportunities presenting themselves?  Is your business prepared for growth and success?

In this article we will examine why now is a great time to develop your business, and give you five things that you can do right now to kick-start your business growth programme.

Thinking about the thinking

If you are thinking about embarking upon any business development activity, you should probably ask yourself the following questions:

·         What do I want to achieve from this activity?

·         How do I go about reaching my goal?

·         How do I measure the success of any business development?

·         Good business and bad business – what is the difference?

·         What will happen if I do not develop my business?

·         Is this the moment to invest time in looking for new business?

So, let’s consider each of these questions.

With business development, as with business itself, it is essential to have a roadmap or plan to establish

a.       Where you are now

b.      Where you want to be (and how long you want to spend getting there)

c.       How you are going to get there

Without this plan, how will you be able to identify what it is that you want to achieve, and how will you measure how successful each of the methods that you have used has been?

Start by writing down what you want to achieve (for example; “I want to win one new customer in my chosen sector every week this year”).  Once you have committed this target to paper, consider HOW you will go about achieving this goal (for example, you might say “in order to win a new customer every week I will need to undertake a television advertising campaign”).

Using this example, if you were to undertake an advertising campaign you would undoubtedly want to know how your investment would be repaid and in what timeframe.  In order to understand this you will need some measurement of the success of your campaign; but what do you use? How many calls you receive after the advert has been aired? How many enquiries were converted into sales? How social media sentiment toward your business has changed since airing?

Always remember that when deciding to undertake a business development campaign you should make your objectives SMART (Specific, Measurable, Achievable, Realistic and Timely)

Before you leap into a new campaign it would be wise to first understand your ‘cost to serve’.  A common mistake businesses make is to accept all of the work that is offered to them without calculating the AMOUNT that each piece of work will make them, but only when you understand this can you make a decision as to whether the piece of work is likely to be profitable or not. 

There are many reasons why businesses take work that is unprofitable, and there are often good arguments for doing so; but the difference between knowing that a piece of work is unprofitable before you start it, as opposed to starting it without understanding the margin implications is considerable. Making this distinction will help you to distinguish between good business and bad business without learning the hard way.

Many businesses abandoned business development when the current financial situation started to take hold, in the belief that if the business ‘tightened its belt’ it would be able to ride out the storm.  We know that whilst this has been a successful strategy for some companies (generally those with huge cash reserves) it has been the undoing of many others.

All businesses have to develop to survive and all companies need to assess their customer base to ensure that the risk of losing any one customer is mitigated and will not have a devastating effect upon the business as a whole.

In our opinion there is no time like the present to start developing your business and to start gaining an advantage over your competitors for the following reasons:

·         Many companies are ceasing trading; their customers will be looking for new suppliers

·         There is a wealth of experienced staff available on either permanent or interim contracts; it is an employers’ market!

·         Although funding is scarce, development funding is still available for businesses with high growth potential

·         You need (and want) to be in the best possible shape to move forward as the recession ends

Remember; if you don’t win new customers, your competitors will.

So, be encouraged by what we have said above. Take heart in the fact that now is the time to move forward. To get you started, here are 5 things that you should do right now to start your business development.

1.       Don’t be caught snoozing

Act now while you are still motivated to do something! Be a company that does, not thinks, and become one that not only survives, but thrives in the recession!  Start by writing down what you are going to do and by when.  Share it with your team and get them to buy in to your plans.  Understand what your unique selling points are and why they are attractive, identify your customer base, and develop a strategy for winning new customers.

Sooner or later we are going to come out of this economic crisis. Where do you want your business to be? At the front of the pack and ready to go, or still snoozing?

2.        Snap up a bargain

Businesses are not the only casualties of the recession – people are too.  Many fantastically talented people have found themselves unexpectedly out of work.  Now is a great time to bag yourself one of these great talents before someone else does.  Many senior executives are looking for opportunities on either a part time or interim basis, so think about taking on a non-executive Director who has the skills that you are looking for.  If you are a sole trader, why not think about taking a partner; someone who has skills that will complement your own (and someone to cover for you when you’re on holiday!).

3.       Failing to plan is planning to fail

Have a business plan and develop it into a clear strategy.  Without a business plan you will never know where you are going or even where you have been.  Will you know why and whether your business has grown, or whether your efforts have been a success?  You don’t have to be a slave to your plan, but you do need one.  Your business plan should take a 5 year view, with the most detail and emphasis being placed on the first 12 months.  And don’t think it ends there; review your plan and strategic goals at least every 12 months and refresh it for the coming year. In this way you can ensure that you have a long-term view out but without commitment to the detail beyond 12 months.

4.       Get your house in order

Most businesses are not successful by accident, but because they do the right things, they do them first, and they do them right.  In simple terms successful businesses develop themselves (doing the right things), get ahead of their competitors (doing them first) and have the processes and procedures in place to ensure that they can replicate their success over and over again (doing things right).  As a starting point, try reviewing your business processes from the point of view of your customers to see how easy you are to do business with.  Sometimes something as simple as this can be quite revealing (obviously doing the review is only the first part of this work – changing and adapting your processes comes next!).  Be ready for success!

5.       Don’t be shy

There is no room for modesty in business. As we say in the North East, ‘shy bairns get nowt’!  If you don’t tell your customers and potential customers about your products and services then who will? (clue: probably no-one).  Don’t be afraid of some self-publicity – use your website to tell people about the successful piece of work that you have just finished, use social media like Twitter and Facebook to promote your company, and ask your customers to endorse the work that you have done .

Use all of the resources at your disposal to tell the world about your business; tell the world just why your product is better than the rest, or even just “why we are awesome”.  Create a social media strategy, to understand which channels are right for your business and your customers, and don’t be afraid to try something new.  Once you have embarked on the use of social media you must keep it up (like any marketing or PR, you only start to see benefits when you use it well!).

Conclusion

Businesses that fail to develop will ultimately fail.  Businesses that don’t just survive but thrive in difficult economic climates are those that constantly develop and win new, profitable work. 

These are the businesses that will be ready for when the economic climate changes.

So do whatever you can to be a business that thrives. And if you need a bit of help, never be afraid to ask.

About Blue Box;

We are a team of Management Consultants and Business Advisors who specialise in helping business of all sizes, across all sectors to become and remain more profitable, to find and win more work and to delight and retain more customers.

Learn more about Blue Box and meet our team at www.blueboxconsultancy.com

Start building your Ark before it rains - a practical view of business planning

Business success is all about preparation.

If a business plan is so important, why do so few people actually do it?

I see many small business owners and ask them about their business plans. 9 out of 10 admit that either they haven’t got one, or they had one somewhere, but it’s in a cupboard and they haven’t seen it since it was written a few years ago. But would you set off on a journey without at least thinking where am I going and how am I going to get there?

They usually come out with a standard range of reasons why they don’t use this essential business tool.

“I’m too busy.”

“I don’t need to borrow any money so I’ve never thought about it.”

“My business changes too quickly to plan ahead.”

“I don’t want to grow my business; everything’s fine the way it is.”

 “I can’t imagine where we’ll be in six months time, never mind 5 years!”

“I’ll be lucky to be in business in six months time, never mind 5 years!”

These business owners are usually talking to me because they need help in some part of their business. I meet a fair few ‘busy fools’ who, although working over 80 hours a week, don’t see that this isn’t helping their business grow. The usual problems involve cash flow, expanding the business but retaining control, finding a work/life balance, managing performance or production issues, wondering how to retire, wondering how to get started, falling revenues and reducing numbers of customers, or rapid growth and too many customers. Or it may be a combination of all of these things! 

Well, with a bit of forward thinking, a lot of these problems could have been anticipated, planned for, acted upon and wouldn’t be problems at all.

In ‘Business Plans for Dummies’, by Paul Tiffany, a study states that companies with just the strategic section of a business plan have 50% more profits and revenue than non-planning businesses. And another survey found that those companies who build their business plan into their everyday working lives enjoy 63% higher revenue growth and 100% more profit.

6 important functions of a business plan:

1. It’s a route plan, or blueprint, to a realistic idea of where you want your business to go. For start up businesses, this is more than just deciding on the name and the colour of your logo!
2. To clarify your ideas and ask questions about your business, market and customers. Really think about your vision, your values and your mission. Identify your customers, analyse their needs and purchasing or decision making processes. What is happening in your area, industry and the marketplace.
3. An operational tool to help you manage your work, your team and your business. Put it into action – don’t put it in a drawer.
4. A financial essential – not just for lenders or banks, but to determine how much money you need to start up, pay yourself and your team, invest for the future, and remain in business during hard times. Anticipating cash flow and capital requirements allow ensure you’re ready for that big tax bill in time, or for that great opportunity that comes your way.
5. A benchmark to measure your success against, and organise future activities to move the business forward. Objectively consider your company’s strengths and weaknesses, and look at your competitors and the overall economy.
6. For future growth and success you need a detailed guide of what you’re going to do. Break down objectives into annual milestones, look at your product or service life cycle, and investigate new products or new markets. And, yes, allowing for flexibility, a five year plan really is a good idea.

And, as the story below illustrates, a business plan can ensure your success and profitability for the future. After all, it wasn’t raining when Noah started building his ark…

An unusual business plan for future sales growth…

A new shift manager was being shown around the Latex factor where he had just started work. The plant manufactures various latex products, and has a reputation for using cutting edge technology in their manufacturing process.
On one side of the building, the factory makes baby bottle nipples. The machine makes a loud "hiss-pop" noise, and the shift manager asks his tour guide what it's doing. "As the rubber is being injected into the mould, it makes a hiss noise." he says "The popping sound is from needle poking a hole in the end of the nipple."
On the other side of the building, the two men look at the condom making machine. This machine makes a "hiss.. hiss... hiss-pop" sound during the manufacturing process. "Wait a second," the future shift manager says, "I know what the hiss, hiss is... but what's with the 'pop' noise every once in a while?"
"Oh, that, ha ha... It's the same as the baby bottle nipple process." says the guide... "It pokes a hole in every third condom."
"But that can't be good for the condoms!" the observant shift manager replied.
"Nah, but it's really good for the baby bottle nipple business!"

If you would like help in writing or reviewing a business plan, contact Blue Box Management Consultants for a free face to face appointment to discuss your needs.

Contact us on enquiries@blueboxconsultancy.com or call  084 3289 3288

See our website on www.blueboxconsultancy.com

Why companies should consider bringing in outside help to solve internal problems

Why should a company bring in outside help?

In his best selling satirical book, “The Dilbert Principle”, Scott Adams provides a view of consultants as seen from the inside of an office cubicle:

• Consultants have credibility because they are not dumb enough to be regular employees of your company.

• Consultants eventually leave, which makes them scapegoats for major management blunders.

• Consultants can schedule time on the boss's calendar because they don't have your reputation as a whiney little troublemaker who constantly brings up unsolvable issues.

• Consultants will return your boss's calls because it's all billable time.

• Consultants work preposterously long hours, thus making the regular employees feel like worthless toads for working only 60 hours a week.

• And finally, Consultants will rarely deal with the root cause of your company's problems, since it's probably the person that hired them.

The book is a cynical and hilarious view of business theory. But there are plenty of good reasons to bring in outside help for your business that provide tangible benefits to the company, your team and your customers.

Specialist skills: I feel quite smug that I understand the theory of the combustion engine, well, sort of… and I’ve been driving cars since I was a teenager, but I know that if I took a spanner to my engine, only doom and disaster would follow. Realistically, I wouldn’t service my own car and I respect the superior knowledge, skills and speed of a trained mechanic. Yet why do so many company leaders think that they are experts in all aspects of business?

The classic errors I see on a regular basis are SME owner managers who have done well for many years, and then some unexpected misfortune clobbers their turnover. As cashflow disintegrates the manager, believing, ‘I’ve been driving this thing for over 20 years, surely I can fix it?’ descends into a maelstrom of spiralling debt, stress and confusion. If, at an early stage in this sorry tale, a professional financial consultant or business advisor had been brought in, they could have swiftly guided the poor fellow through the quicksand to a safe place.

And the examples could go on and on… Bringing in a consultant gives you access to a specific skill set, that can’t be found within your business to the same degree. Even though daily rates are higher than your regular employees (and don’t we all gasp when we see the hourly rate of garage mechanics?) but looking at what is at stake, and what could be saved, they can bring immense value to your company.

External viewpoint: And precisely because the consultant is not part of your business, he or she brings an objectivity and detachment to the problems you face. Being independent of internal politics and having no historical frame of reference can actually be a positive and liberating place to be. Where difficult situations have been tiptoed around due to cliques, personality clashes or ancient history, a consultant can provide unbiased opinions and implement the changes needed without anyone feeling there were any personal motivations.

A fresh look from an outsider can be very enlightening for a business. A successful engineering firm I met recently, with an excellent technical ability in their field, found themselves at a loss to understand why they could not break in to supply contracts for larger national companies. They thought their prices were too high, their location too distant, their salesperson was ineffective, but couldn’t pin down the problem. But the answer was very simple. They had overlooked the importance of their company image, the need for well written sales literature and a professional website, and, despite all their potential, they gave the impression of being a back-street fabricating workshop. They hadn’t stood outside their business, and looked at it from a customer’s point of view.

Temporary services for a limited time: A consultant comes to the business with the benefit of having worked in many other organisations, and having years of experience in the business world.  Exploiting their knowledge for a short time can have a lasting positive impact on your company. This is what you’re paying for.

Even developing a long running programme of business improvement may only need the input of a consultant for a limited number of hours or days per month. Their physical presence in your business is unlikely to be needed for 40 hours a week. What you get is their knowledge, skills, creativity and experience. They will motivate you and your team to achieve your goals through guidance and advice, and let you implement the ideas yourselves.

Engaging a consultant is nearly always less expensive in the long run than hiring managers or staff with similar skills and experience. And you don’t have to keep paying for them, or wonder what to do with them, when the project is over.

What is the role of a consultant in your business?

Qualified resource: when you bring in a qualified specialist, in addition to legal compliancy requirements (HR law or Health and Safety, for example) benefits can be felt in all parts of your business. Outside specialist knowledge inevitably produces a rise in standards internally, and adds credibility and cachet for your company in its external dealings.

Professional adviser and counsellor: sometimes it’s just good to talk to someone who is not part of your business or close to you personally. A consultant understands your position, and can give you confidential advice, support and make you feel you are not on your own. I am part of a group of business consultants called Northern Business Advisers (NBA) - see www.northernbusinessadvisers.co.uk - who have, as their strapline, ‘We’ve walked in your shoes.’ I think that sums it up? Having a reassuring presence in your business, who has been through many similar situations before can give you confidence and optimism when times are tough.

Catalyst for change: here is an old definition of madness: doing the same thing over and over again, expecting a different result. I can’t think of any improvements that are brought about by doing nothing? Change is essential to growth and development, but it can be painful. Bringing in a consultant can speed up this process as they do not have other obligations in the company, or a day job to attend to. You can set them clear deliverables and timelines, and allow them to apply their skills and experience to benefit your business.

Being from ‘outside’ the business means they can focus on the objectives, not the day to day tasks. Their position of authority can be used to communicate changes to the affected employees, customers or suppliers, and handle objections and difficult situations in a professional way, with more detachment. This reduces the emotional struggle many small business owners go through when handling things on their own, but which gets the job done quickly, effectively and profitably.

If you think you could benefit from the advice of an external consultant, Blue Box Management Consultants, contact us. We will be delighted to give you a free appointment to talk through any issues that face your business.

Contact us on enquiries@blueboxconsultancy.com

Tel 084 3289 3288

See our website on www.blueboxconsultancy.com