Business Posts

The Power of the "Master Mind"

In the classic book Think and Grow Rich, author Napoleon Hill writes that power comes from accumulated knowledge and an individual can organize that knowledge and accumulate more of it and do so faster by taking advantage of the “master mind,” those persons who have mastered certain skills or processes and who possess superior subject matter knowledge. To access that powerful knowledge and thus move at a quicker pace toward certain objectives or successful endeavors, Hill recommends forming master mind groups, in which individuals gain insights from one another’s accumulated knowledge and experience.

Andrew Carnegie is an excellent example of someone who benefited by engaging knowledgeable individuals who shared their insights, knowledge and lessons learned from experience. He retained 15 experienced and powerful individuals who were his advisers, partners and sounding board. In fact, Carnegie enlisted Hill to document how he had acquired so much wealth. The outcome of that engagement is the aforementioned book. Carnegie felt that this practice of listening to the “master minds” of his day was the primary reason he became one of the leading industrialists and philanthropists of his age.

This relatively simple process can be duplicated today by anyone willing to devote some time and energy to it. We at NaperLaunch want to help local business owners adopt this practice by sponsoring three master mind groups. Each group will meet monthly on Thursday mornings from 9:15 to 10:30 a.m. The groups will be formed by registration only and each group will meet on a different week of the month. Each group will be limited to 15 participants at a time; if one drops out, then another registrant may join. The group members will become intimately acquainted with the business models and plans of each participant. Expert advisers will also be on hand to add insights to the conversation in each meeting. Each master mind meeting will follow an agenda and each member of the group is expected to actively participate.

We anticipate fostering a bond of commitment and support among group participants as they learn from each other’s expertise. Most importantly, we believe in the concept of “peer learning.” The NaperLaunch community is built upon that principle.

To learn more about the NaperLaunch master mind groups and to join a group, visit the Peer Learning page on our website.

Posted: 
Wednesday, December 4, 2019 - 11:00

Year-end Review: Your Business Barometer

We all know that a barometer is an instrument used to measure atmospheric pressure. Another definition of a barometer is something that reflects changes in circumstances and opinions. A good business barometer could be an annual review of that business to determine current trends and can also be used to forecast the future, and thus, to revise a strategic business plan.

An annual check-up is as good an idea for a business as it is for a human being. Most successful businesses spend time frequently and regularly evaluating progress toward strategic goals. Sometimes, even those strategic goals need an update.

Owners of established businesses may want to use the annual review as a sort of barometer to identify how to make the most of the market position already attained and decide where to take the business next.

Reviewing progress will be particularly important when an owner feels uncertain about the future and which direction to take. An annual review can refocus and give new direction as a new year of operations begins.

When setting a new direction, questions to be addressed might include these:

  1. Where should the business be in 3-5 years?
  2. Are there new markets to pursue?
  3. How can the business perform better than the competition?
  4. What skills, assets, relationships, technical competence will be needed?
  5. Are there new or different key measures of performance that should be adopted?

When assessing the core activities of the business, these questions may be helpful:

  1. Are any products or services not performing well? Should or could they be discontinued?
  2. What are factors making some products more successful?
  3. In both cases, how can products be improved or are there complimentary products or services that should be offered?
  4. Do products and services still solve customer problems and meet their needs?
  5. Are there any rising costs that have made certain products or services unprofitable?

When assessing the efficiencies of the business, consider these questions:

  1. Does it still make sense to own or lease physical space? Is the current space still meeting the needs of the business?
  2. Is it time to consider a new location for the sake of convenience to the trade area, for better support of updated technology, capacity issues, potential cost savings, etc.?

When assessing human resources, consider these questions:

  1. Is there significant turnover? What is causing it?
  2. Is current staff adequately trained to do the required job, or is additional training necessary? Are additional skills needed?
  3. Is the leadership team effective?

When reviewing your finances, ask these questions:

  1. Is gross margin going up or going down? What are the causes of that movement and does the trend present an advantage or are adjustments needed?
  2. Have working capital needs changed?
  3. Are there cash flow challenges?
  4. Is financing debt becoming too costly?

Conduct a fresh competitor analysis by taking these actions:

  1. Determine if there are any new competitors and identify what they offer.
  2. What do they say about themselves?
  3. What do customers say about them?
  4. Conduct a revised SWOT analysis

A fresh market analysis might be in order. Consider these factors:

  1. Changes in your market or trade area
  2. Changes in customer needs
  3. New technological developments
  4. Customer feedback on your products or services
  5. Other analysis tools such as Porter’s Five Forces or STEEPLE analysis, in addition to the SWOT analysis already mentioned.

Reviewing these seven areas of a business each year will go a long way in uncovering potential problems as well as opportunities for improvements. By examining these areas in depth, the business owner will regain certainty and will become focused on key activities that will assure a higher probability of success.

NaperLaunch will be hosting a SCORE Fox Valley workshop on December 5, at 8:00 a.m. in the Nichols Library Community Room. Join us for more guidance on year-end analysis.

Posted: 
Monday, November 4, 2019 - 15:45

Employee Retirement Plans Aren't Just for Big Business

Many experts recommend saving 10% to 15% of pretax income annually for retirement. But while Americans accumulate the majority of their retirement funds through employer-sponsored defined-contribution plans, according to a report from the Pew Charitable Trusts, many small business owners and their employees are not afforded this option.

A 2017 survey of small business owners found that 34% of small business owners do not have a retirement savings plan for themselves. In addition, in 2015, the Social Security Administration reported that small businesses are the least likely to provide their employees with retirement options; while 87% of businesses with more than 100 employees offer retirement plans, just 28% of businesses with fewer than 10 employees did so.

The most common reasons for not offering a retirement plan cited by small business owners in the Pew report were the expense of starting a plan, the lack of resources for administering a plan, and a perceived lack of interest from employees.

However, starting a retirement savings plan for your small business can be easier than you might think. Tax credits and incentives are available and can offset the costs of starting a retirement plan. Once the plan is established, employer contributions also are tax deductible.

In addition, a retirement plan is also one of the most desirable employee benefits, so offering one may help you attract and retain qualified employees, reducing turnover.

Small business owners who are interested in establishing a retirement plan have a number of options, including IRA-based plans, defined contribution plans, and defined benefit plans. The IRS and SCORE offer many helpful resources describing and comparing the various retirement plan options.

For more information about retirement plan benefits and options for your small business, join us on Tuesday, Oct. 1 for Choosing a Retirement Solution for Your Small Business, presented by Scott Miller of the U.S. Department of Labor’s Employee Benefits Security Administration. 

This session is part of NaperLaunch’s 6th annual Entrepreneurs Week, a series of workshops focused on educating and guiding startup and experienced entrepreneurs. For more information, visit www.naperlaunch.org/entrepreneurs-week.

 

Sources:

Choosing a Retirement Plan for Your Small Business. SCORE.org. 15 May 2019.

Dushi, Irena, Howard M. Iams, and Jules Lichtenstein. Retirement Plan Coverage by Firm Size: An Update. Social Security Bulletin 75(2): 2015.

One-Third of Small Business Owners Don’t Have Retirement Savings Plan. Manta 11 Jul. 2017.

O’Shea, Arielle. How Much Should You Save for Retirement? NerdWallet. 8 Aug. 2017.

Small Business Views on Retirement Savings Plans. Pew Charitable Trusts. Jan. 2017.

U.S. Department of Labor Employee Benefits Security Administration and Internal Revenue Service. Choosing a Retirement Solution for Your Small Business. IRS.gov. Oct. 2017.

Posted: 
Tuesday, October 1, 2019 - 10:30