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What Makes a Good Business Consultant?

December 10, 2010 by Frank Goley, Business Consultant

I have been a Business Consultant for a while now, and I have had some successes and failures, some challenges and obstacles to overcome, along the way. But in the end, the measuring stick of my success as a consultant is completely about whether I am helping my customers to succeed. Contrary to all that is said about what a Business Consultant does, the measure to gauge whether the consultant is any good, is the direct success a company has experienced as a result of the consultant’s advice. I am writing this blog because business consultants are a dime a dozen in the marketplace, and it is dubious whether a majority of them are actually getting companies real results. There are some great business consultants out there, and I am privileged to work with some of them. Unfortunately all the unaccountable, inexperienced consultants contribute to giving the industry somewhat of a mixed report card. Here is some wisdom on what makes an effective business consultant, providing a measuring stick to determine if your business consultant is up to snuff.

Number One Determinant – Is the Business Consultant Highly Experienced in Business?

Business Success can’t be learned in school. It comes from years of business learning experiences and from mentoring with more experienced business people. Same for the business consulting profession- really more so. A Business Consultant is only as good as the accumulated experience the consultant possesses. It takes a minimum of 20 years business experience to make a consultant really effective. If your business consultant does not have a business track record, then I suggest one of two things: 1) Run away, quickly or 2) If you see potential and worth, put in place a consulting contract that is based on results and has major accountability built in (from both sides).

Number Two Determinant – Does the Business Consultant Listen?

Does your business consultant listen intently to what you as the business owner and business as a whole has to say? Does the business consultant have a tried, tested and proven Business Consulting process to effectively engage company principals and personnel in order to obtain the needed information to make assessments, analysis and recommendations? A business consultant is only as good as how well the consultant listens and communicates. Without these two key skills, the effectiveness of the consultant’s work will be highly minimized.

Third Determinant – Is the Business Consultant Accountable to Results?

I see so many Business Consultants that do nebulous work, have no structure to gauge results of the advice and recommendations, and are completely unaccountable to their work. A good business consultant works in the reverse. A good business consulting contract is results and goal based, with milestones established to gauge the effectiveness of the recommended and agreed upon strategies. Such a structure is helpful for both the business owner and the consultant. At the end of the day, I want to see the results of my advice and if things are going as anticipated. Therefore, I have a system in place to identify any issues that arise so I can go to work on making adjustments and changes in strategy to obtain the desired outcome. Transparency and accountability are huge factors in a successful and trusted relationship between consultant and business owner.

Lastly, I know that I know not…

I am open to learning from others (whether from a business owner, another consultant, a business mentor or the like) on a daily basis so that I can be an even better business consultant for my customers tomorrow.

Posted in Business Consultants. Comment

The One Page Executive Summary

November 24, 2010 by Frank Goley, Business Consultant

The Executive Summary is often touted as the single most important part of a Business Plan. If the business plan is to be used for external uses, such as a Funding Business Plan or Joint Venture Business Plan, then, yes, the executive summary is of pivotal importance. The executive summary must be concise (no more than 3 pages) and encompass the most important parts of the business plan for the particular audience/reader. In many instances, particularly if you are going after Venture Capital or Angel Investment, the executive summary can only be one page. It is a huge challenge to get the most salient points of the funding business plan on one page, and a challenge I just recently met as a Business Consultant with our Executive Summary Service for a client competing for angel investor seed finance.

Organize the Executive Summary Layout in Two Columns

I suggest using Power Point and lay out a one page slide with a 1/4 page column with a border on the left side of the page, and next to it, a 3/4 page column that has boxes with borders of various sizes (per the amount of information needed in each box). Please see the attached One Page Executive Summary Example (PDF) format and layout. By dividing the page into two columns, you can fit a lot of key information into one page. The suggested format should be customized per your company, purpose, funding and target.

Customize the Executive Summary for the Reader

If the reader of the executive summary is a specific venture capital firm or angel investment network the odds are they will have a preferred format and structure for the one page executive summary. So be sure to customize each executive summary for each particular funding group you target, or whoever the intended target of the executive summary is (such as a joint venture partner or strategic alliance target).

Create as a Power Point

By creating the one page executive summary as a Power Point document, you can easily embed a video to demonstrate your product or service. Video brings an executive summary to life and gives the reader a real look into how your product or service works. Be sure to keep the video short (no more than 30 seconds) and small in size so the document doesn’t become a huge file. Note: This assumes you are emailing the Power Point or presenting the opportunity via a computer presentation.

Getting Interest is the Number One Goal

You can’t completely prove out your business model in a one pager so don’t try. The executive summary should entice the reader to ask for more information or meet with you. The Business Plan is the next step and will show how you as a company can realistically achieve the goals and numbers set out in the summary.

The Team is Most Important

Any experienced venture capitalist will tell you that the company team is much more important than the product. You can have the best product in the world with a crappy team and fail. You can have a fantastic team with a crappy product and succeed. Winning company teams find business models that will work despite the product or service offering. Be sure the executive summary shows the clear advantage the company has with the team that is in place and members to come on board as the company grows.

The One Page Executive Summary Works

The before mentioned client (see paragraph one) came to me because they were trying to win a contest for initial angel investor seed funds to get their company positioned for later round Venture Capital. They had tried 6 months ago to compete against 2,000 companies and didn’t get close to the final round. This time they contracted me for our Executive Summary Service, and due to the one page executive summary, they have made it to the final 12 companies out of 1,600, increasing their chances of getting angel investor funds 1,000%. They attribute the one page executive summary to getting them this far, now the product and team presentation will determine if they get the funds. Either way, funds or no funds, they have the visibility in the angel community they desperately needed to get funding for their company. A simple document brought them this opportunity and timely visibility.

Remember: The Executive Summary is just the first step. You need to have a Business Plan to back it up. Have your ducks in a row! You may want to consider our Business Plan Service for your business planning needs, whether for funding, business success, or another business plan purpose. All of our business plans are customized to our customers needs and contain an executive summary. We offer Four Levels of Business Plans to meet most purposes and budgets…

Posted in Business Planning. Comment

Developing, Writing and Implementing a Business Plan Takes Commitment and Diligence

November 12, 2010 by Frank Goley, Business Consultant

One question: Do you have what it takes to see a business plan process through?

I am always surprised as a Business Plan Consultant how a business planning process brings a company to its knees. Admittedly business planning is difficult, but it certainly isn’t impossible. I just find that business owners and entrepreneurs don’t like to do it and want to skip ahead of it. By skipping ahead, they are taking a huge risk, inestimably saying, “I will guess how to be successful with my business.” Do you want to guess with your hard earned dollars and risk the livelihoods of those who come everyday to work for you? Of course not…

To Develop a Good Business Plan Takes 75 – 150 Hours

And sometimes business plans require 200-300 hours of work. It really depends on the circumstance and size of the company, scope of the market and how comprehensive the business plan needs to be. If you are working with a Business Consultant on the plan, plan on dividing that time between you. No matter how good and experienced the business consultant, good business planning takes a lot of involvement from the business owner and team members.

Work on the Plan a Little Bit Everyday and Make it a Priority

Business owners and team members are busy. I get it. You have a business to run. Set aside 2 hours per day for your business planning. That’s it. Doing a little work on it everyday is better than trying to work 5-10 hours on it at one time. Business Planning is a marathon, not a race. Doing a little bit every day of the week will quickly add up and real progress will be. Moreover, you won’t get burned out and your thought process behind the business planning process will remain sharp and fresh. I recommend doing your business planning first thing in the morning before your busy day starts. Make it a priority, and it will get done in a timely, efficient and effective manner.

A Business Plan Process Builds Momentum

If you look at the totality of a business plan, it becomes very daunting. But if the business planning process breaks it down into little steps and in a building block architecture, then the Business Planning gains momentum over time, becoming easier and much more enjoyable as you progress. Business planning can be enjoyable if you get that momentum and see the result of discovering things about your business, market and competition that you didn’t know prior.

When the Business Plan Document is Done, You are Just Getting Started

What use is a Business Plan if you don’t implement it? Otherwise, it is just a document collecting dust. A business plan is a roadmap to success and should have step by step implementation as part of the Strategic Plan roll out. A business plan is really never done. It is a continuous tool, process and system to use to sustain competitive edge, to quickly spot market trends, to anticipate problems, and to uncover hidden opportunities. A business plan is a living, breathing, dynamic tool to use on a daily, monthly, quarterly and yearly basis to guide a business through the minefields to come.

ABC Business Consulting offers 4 levels of business plans to meet most business planning needs, goals, budgets and objectives.

Posted in Business Planning. 2 Comments

Top 10 Reasons a Business Plan Fails to Help a Company Obtain Funding

November 5, 2010 by Frank Goley, Business Consultant

In my Previous Blog Post, I discussed two of the fundamental reasons why a company’s Funding Business Plan Fails to Help Obtain Funding. These two often missed business planning fundamentals are: Inadequate Business Plan Process and The Business Plan Didn’t Adequately Prove How the Business will Succeed. In this blog post, I continue with 10 more top reasons why Funding Business Plans fail to help a company obtain funding.  

#1 – Experience Level of the Company Principals is Lacking

This is a biggie. If you don’t have the right mix of experience on the founding team and management, then finding funding will be extremely difficult. In your Business Planning, identify your management gaps and determine ways to fill them and overcome them.

#2 – Lack of a Business Track Record

This goes along with #1. To obtain Business Finance, whether from a bank or investor/venture capital, the business plan clearly needs to show previous successful and unsuccessful business track records. Unsuccessful business experiences are good since they show how an entrepreneur has learned and adapted, as long as, the non-successes don’t overshadow the successes. At the end of the day, the company principals need to show successful track records. They did it once, they can probably do it again is the thinking.

#3 – Unrealistic Financial Projections

As a Business Consultant I see this all the time in Business Plans. If the Business Planning Process builds a well researched and reasoned Marketing Plan and Strategic Plan, then more times than not, the Business Financials will be based on good assumptions and reflect real market realism. However, many companies in their business planning short the marketing and strategic planning processes, which produce wild guesses in forming the financial projections.

#4 – Lack of Existing Cash Flow

Bankers and investors alike want to see a company that is bringing in some cash flow. This makes the business plan objectives and projections a lot more believable and the funding request a lot more palatable. Signed contracts also indicate future cash flow if funding comes through- this is a great hot button for funders.

#5 – Lack of Company Principals Cash Contributions

If you can’t / won’t commit personal funds to your venture, why should anyone commit theirs? Need I say more? 10-20% principal cash contribution makes for a strong funding request.

#6 – Inadequate and Poor Quality Collateral

You probably can’t finance all of your business plan with just cash investment. Good collateral goes a long way toward opening up your funding options and possibilities. Offer clean collateral that is fundable. Good real estate with cash flow is great, good assets, equipment and so forth. Cross collateralizing can be an option and often pulls in the security a funder is looking for to make the leap to fund a company. Collateral that is highly leveraged with liens or poor quality collateral just makes your funding request look sub-par.   

#7 – Bad Executive Summary

The Executive Summary makes the first impression. A poor summary will get your funding business plan quashed in 30 seconds. Give your plan a chance with a well developed and presented executive summary.

#8 – Poor Ancillary Documents

A Business Plan alone isn’t sufficient for funding. You also need a good Loan Package and Investor Overview. Get your documents and packages done prior to starting your funding search so you can be jimmy on the spot with the funder’s request for more information. Good due diligence goes a long way to successful business funding!

#9 – Messy Business Plan

A messy plan means a messy business. Funders don’t fund unprepared companies and companies that don’t care about their work. The business plan needs to be neat, clear, easy to read and scan, legible, and presented using good writing and grammar. While every plan needs substance, it is the polishing of the plan that gives the substance that added edge. An edge that can and will get you funded.

#10 – No Substance Behind the Flashy Colors, Tables and Charts

As a Business Plan Consultant I see these “good looking”, flashy business plans all the time. But upon closer inspection, I find them hollow and lacking any real substance. It is the substance that gets you funded, not the flash, not all the color graphs and charts and photos. It is good to have some of this pizzazz, but the substance and reasoning in the plan is what makes it believable. Many business plans are produced using templates, samples, and cookie cutter content. These types of plans are thrown in the garbage can in 30 seconds or less by a funder. Meld your substance with some flash for best results.  

Need help on your Business Plan? We offer FREE Business Plan Reviews…

Posted in Business Planning. Comment

The Fundamental Reasons Why a Funding Business Plan Fails

November 1, 2010 by Frank Goley, Business Consultant

Business Plans don’t guarantee funding. It is the foundation and fundamentals behind a Business Plan that give the plan and company the best chance to obtain funding. The distinction is important. No matter how colorful, flashy, professional looking and apparently well written a business plan is, there are business fundamentals which need to be proven out in the plan to make the funding request viable. We see so many business plans on the market that look great from an aesthetic standpoint and appear to have all the necessary ingredients, but upon closer inspection are just canned, cookie cutter plans that prove little as to specifically why a particular company is a good investment or lending risk. A sample business plan that got one company funding won’t get another company funding unless that company has the right business fundamentals in place. Let’s look at the top two business fundamentals often missing in a business plan that fails to help a company obtain funding.

Inadequate Business Plan Process

The quality and depth of the Business Planning Process is more important than the business plan itself. If the process is lacking, then the produced business plan will be significantly lacking. The planning process needs to be customized for the particular business. Our Business Planning Customers often remark that the process behind the business plan development was extremely beneficial, even more so than the finished plan itself. A good business planning process uncovers problems and addresses them prior to sending the plan to a funder, maximizing the reception to the plan and the results of the plan.

Tip: Please see my Business Plan Book for a proven business planning process that can be applied and customized to all types of companies, no matter the stage, size or funding level.

The Business Plan Didn’t Adequately Prove How the Business will Succeed

This is a huge point. As Business Plan Consultants, we see many funding business plans being developed in the marketplace which are shallow, hollow plans that do little to adequately and realistically prove to the funder that the business is capable of being successful, servicing the debt level requested, and being a good investment risk. The underlying principle behind any business plan, no matter its purpose, is to prove out and show how the company will run successful business operations. Due to the success of the operations and marketing of the company, a case can be made for funding. A Funding Business Plan is really just correct formatting and having the information a funder is looking for. It is the fundamentals behind the plan that prove a best chance for business success that helps to position the company for a successful finance campaign. If a plan is lacking these fundamentals, it will never have a chance at obtaining funding.

My next blog post will explore some more of these business fundamentals and other reasons why a business plan fails to help a company to obtain funding.  

Posted in Business Finance, Business Planning. Comment

Have You Updated Your Business Plan Recently?

October 13, 2010 by Frank Goley, Business Consultant

A lot has changed in this prolonged recession. Has your Business Plan been updated? Or has your business plan been collecting dust on the shelf somewhere? We are all guilty of this. We shy away from the critical planning that needs to be done on a consistent basis to be successful, no matter what the markets and economy throw at us. Here are reasons why you need to update your business plan today… 

Things Change Constantly in Business 

Your customers, markets, niches, industry trends, etc all are in a flux of change. A successful business stays in touch with change and adapts to best serve markets and customers. Often businesses who fail in this area, have failed to plan. Preparing a business plan is just the first step. Your Marketing Plan and Strategic Plan need to be assessed on a monthly and quarterly basis to determine if your plans meet the expectation and changes occurring in the marketplace. Are your Financial Projections still accurate and the underlying assumptions realistic and correct? The business plan just gets you halfway to first base, it is the implementation, tracking, measurement, assessment and adjustment of the plan as your company moves forward that is most important.

Have You Even Implemented Your Business Plan?  

A business plan is just a document. While the Business Planning Process can be very beneficial for a company, it is the implementation of the business plan that really counts. You will never receive the great benefits of a business plan if you don’t implement it. So dust off your business plan, update it for the current economic and market conditions, then set out a clear cut, step by step plan on how you will implement the plan. Then it is just a matter of tracking the results and making adjustments as you go. 

Update Your Business Plan on a Monthly and Quarterly Basis 

Have a 2-3 hour session every month and a half day session once per quarter to review your plan and the results gained thus far. Make changes and updates to your plan on a team basis so the entire company is involved in the strategic direction and success of the company. A plan should be a living, breathing document. It needs to be intertwined into the fabric of a company to be successful. It is a dynamic tool which needs consistent commitment and diligence. The time put in updating a plan will pay off well in profits later. A little time spent on updating your business plan will have significant ROI in the future. Understanding where your company is going and exactly how you are getting there are two of the most important strategic elements of a successful company.  

For help on your business plan, please consider our FREE Business Plan Review service…

Posted in Business Planning. Comment

Are You Using RSS Feeds in Your Business?

October 7, 2010 by Frank Goley, Business Consultant

RSS Feed stands for Really Simple Syndication. Simply put, it is a web feed format used to publish frequently updated work, such as blog entries, news headlines, audio, and video. RSS feeds are a powerful weapon in a company’s arsenal to keep in contact with current customers, find new prospects, effectively use for SEO efforts, and a host of different applications. As a Business Consultant, I strongly recommend you start developing and using RSS Feed Strategies aggressively in your company’s Business Plan and Marketing Plan. Here are some methods to apply using RSS Feeds in your business to profit from this nifty technology.

Keep In Touch With Your Customers

The cheapest acquisition cost is repeat business, verses selling new customers. To sell more products and services to your existing customers, you need to be in front of them. A Newsletter is one good method of staying in contact with existing customers, but the RSS Feed in my opinion, is superior. I use RSS Feeds in two main areas with our existing customers that works really well…

v  To Subscribe to Our Business Success Blog: Every time I make a new post, the RSS Feed sends that post to our customers computers. 

v  To Send Out Company Updates: Things like specials, discounts, announcements, achievements- everything our customers would be interested in hearing about us.  

Find New Customers

I send out the RSS Feed for our website and blog to RSS Directories, Search Engines, Blog Directories, and RSS Feed Sites. This in turn shows up throughout many hundred directories through out the internet and in the search results. When web visitors search the internet, they find our listings and posts which are continuously updated by our RSS Feeds. Pretty nifty! This is an extremely powerful way to keep Fresh content in front of targeted prospects.

Awesome Search Engine Optimization (SEO) Application

One chief ranking factor in the Search Engines is fresh, relevant content. We use our RSS Feeds to tell the search engines on a daily basis where we have fresh content for relevant searches. I can get a top 10 search engine result very often on the same day the content is fed out. Search on Google has turned to Real Time Search and has converged with Social Media results. We use our RSS Feed with not just search engines but through out our Social Media networks to quickly get new content immediately indexed and well ranked. RSS Feeds play into Google’s real time search results extremely well.

Put RSS Feeds to work for your business today!

For help in effectively using RSS Feeds, you may want to consider our SEO Package.

Posted in Business Internet Strategies. 2 Comments

Organic Web Visitors Beat Pay Per Click Visitors

September 28, 2010 by Frank Goley, Business Consultant

While there is a place for online Pay for Click (PPC) advertising (I use it), I find that visitors who come to me organically through the general search engine results are much sticker, more qualified in many respects and have a much higher closing ratio. While I use both PPC and Search Engine Optimization (SEO), I find that my SEO efforts have a much better return. Of course this can be a little industry and web visitor specific, but I know this can be applied to many types of businesses, whether 100% online company or a brick and mortar with an online presence. Here is why I like SEO derived web visitors so much.

Relevant

The General (organic) search engine results tend to be a lot more relevant than the results for the Sponsored Ad area. This way targeted visitors can really find what they need.

More Qualified

I see a lot more non-customer type visits on a percentage basis via the Organic Search results than I do coming via PPC. With PPC, you are paying to qualify them, while with SEO derived visitors, they qualify themselves typically. Therefore the customer acquisition cost and conversion rate for SEO customers is much better than PPC.

PPC and Organics Work Best Together

PPC is definitely worth doing but should be part of the overall SEO Strategy and not the other way around (nor treated separately). PPC actually makes your SEO better and can pick up customers where SEO would cost too much to implement or where you don’t have good SEO results. Also PPC is a great research and testing ground for your SEO Strategy. Very quickly you can determine if a keyword phrase has strong potential.

SEO has a lot more Marketing Flexibility

PPC limits how well you can market to your targeted web audience while SEO offers unlimited possibilities on how to market in the general search engine results. You have much more choices as to titles, keywords and descriptions in the organic search results. Your Online Marketing Strategy ought to include SEO for sure!

General Search Results = Credibility

When a web visitor sees a return in the general results, they tend to put a lot more trust and credibility on it, verses seeing a short, paid for advertisement off to the side. This may be a big reason why SEO visitors convert more profitably.

Resources: Here are some previous blog posts on Web SEO to help you.

SEO Basics to Get Good Rankings on the Search Engines

SEO can be More Effective and Profitable than Pay Per Click

Posted in Business Internet Strategies. Comment

Micro Loans are Helping Small Businesses to Start Up and Succeed

September 24, 2010 by Frank Goley, Business Consultant

Micro Loans have been around for a while but they are now getting some attention, particularly with small businesses needing seed finance or early stage growth finance. In fact micro lending maybe what will help us get out of this recession. Micro loans create new businesses, which will need employees. Additionally these newly seeded businesses will hopefully encourage the larger banking institutions to lend more freely again. More reason for job growth. Small business growth + newly created jobs = a fix we need to exit this recession for good.

What is a Micro Loan?

A Micro loan is generally a loan to a start up or early growth small business for less than $35,000. Mostly controlled by non-profits, and they typically lend to businesses in a particular geographical area- generally a “local” or community based loan. Terms are for 5-6 years with collateral to securitize the loan typically. Micro lenders require a solid Business Plan and Loan Package. You can use micro loans for working capital, equipment, machines, inventory, supplies, furniture, etc.

The Impact of Micro Loans

$56 Million in micro loans will be distributed through the SBA this year. An average US micro loan is around $13,000. The payback rate is an astonishing 98%. A lot of these business loans are going to low income entrepreneurs, giving them an opportunity to succeed and strengthen their local community.

Two Businesses that have Benefited from a Micro Loan

Love Joy Sweet Treats makes cupcakes, cookies, and many other sweet treats. The owner received $1,500 to start up her company, and she is off and running and selling those great treats. The owner of Smart Start Sitters received $10,000 to get her child sitting service off the ground and running full steam. These aren’t high tech companies but they are putting food on the table for the family owners and employing people. Something we should all think about. As a Business Consultant, I truly recommend you try a micro loan if you have the burning desire to be your own boss and create your own destiny.

For more Resources on Micro Loans, please see my blog posts on:

Have You Considered Micro Lending, Community Banks and Credit Unions for Your Business Finance Needs?

Business Finance in a Recession- Part 3: Business Funding Alternatives

Posted in Business Finance. Comment

Free Business Financial Projection Software

September 21, 2010 by Frank Goley, Business Consultant

Developing Financial Projections for your Business Plan can be a trying and complicated experience if you do it from scratch. It doesn’t have to be that hard, nor does it have to cost a bunch of money to do. There is a lot of business planning and financial projection software out there for purchase. However, if you are looking to develop some solid financials with out the cost of software, then there are some good free financial projection programs out there. One of them is offered for free by SCORE®.

6 Step Worksheet

Very simple to use. It highlights mandatory and optional areas for your input, and it contains a six step worksheet process. Just fill out:

§  Required Start-Up Funds

§  Salaries and Wages

§  Fixed Operating Expenses

§  Projected Sales Forecast (2 sheets)

§  Cash Receipts and Disbursements

Produces The Financials for You

After filling out the necessary information in the six worksheets, the program produces the following financials for you: 

§  Monthly Income Statement for three years

§  Monthly Cash Flow Statement for three years

§  Yearly Balance Sheet for three years

§  Year End Income and Expense Summary for three years

§  3 Year Financial Ratio Analysis

§  Breakeven Analysis

§  12 Month Amortization Schedule for three years

§  Financial Diagnostics Sheet

Be Sure to Read the Notes Explanation

There is a sheet containing explanatory notes for the financial projection program. Be sure to review it before you start.

Provides an Example Financial Projection Template 

In case you have questions on how the program works and the types of financials it produces, the program provides a fully competed financial projection template to assist you. It also gives you an idea of the finished product.

Free Mentorship 

You can use a local SCORE® mentor to answer any questions you may have developing your business plan and financial projections.

Options 

While Free financial programs don’t have all the bells and whistles, this program will get it done well for many small businesses. Check it out and see if it will work for your needs. Be sure to do some searching on the internet and find the other free financial projection programs out there. There are a bunch of them.  

Disclaimer: ABC Business Consulting and the Blog Author are not endorsing the product mentioned in this blog. This is for informational purposes only.

Posted in Business Financials, Business Planning. Comment