CONQUER BUSINESS OBSTACLES WITH BUDGETING

On Saturday, I accidentally went rock climbing. I truly had no intention of clambering over rock after rock for 2,000 nearly vertical feet when I started out. I thought I was going on a hike to a panoramic vista. Well, the view was there, and it was breathtaking in more ways than one. Climbing the 2,000 feet back down was even worse. I hyperventilated. I cried. I fell several times. I plopped down on top of a rock at one point and announced to my husband, histrionically I admit, that he could just leave me there. I was done.
Obviously, I pulled myself together and made it down the mountain, thanks in large part to the infinite patience of my husband. My life was never really at stake, and my fears were largely unwarranted.
Astonishingly, many small business owners approach their budgeting decisions just like I approached that mountain. With so much more at stake, they charge up the hill, allocating resources to things that aren’t going to take them to the top and burn out long before they get anywhere. Without a budget as a map, they wander all over the mountain, with most never finding their ultimate destination.
Now is the optimal time of year to start seriously working on a 2009 budget for several reasons. First, it forces everyone to take a hard look at where the business actually is for 2008 to date, enabling corrections and adjustments between now and year end to achieve greater success this year. Second, it provides ample time to evaluate alternatives where they exist and truly determine the most efficient way to approach spending decisions for the coming year. Lastly, working on a budget now enables it to be completed before the holidays, more than a month before productivity suffers for most small businesses in general.
To help you get started, here are some tips for preparing and implementing a meaningful budget.
Work from the information you currently have. You can print year-to-date financials that can be easily annualized. To annualize a number, take an amount and divide it by the number of months in your year-to-date statement (say 9 if run through September 30). Then, multiply that by 12. The result provides a general idea of what your annual amount may be for that particular category. The annualized numbers provide an ideal starting point for a 2009 budget. Factor in any large planned expenses in the months you already know they will occur. It is easy to adjust an annualized number for firm amounts or general ranges that you know will be spent because those decisions have already been made and approved.
Be realistic. It is best to err on the side of lower income figures and higher expense numbers at first and then adjust expenses downward to balance a budget. Without a well articulated strategic growth plan, making revenue higher to enable more spending will result budgetary overruns almost every time.
Involve your team in the process. The more people you have in your organization, the more opportunities you have for budgetary straying. By making your key team members accountable for some portion of the budget, you give them buy-in and help them understand the nuts and bolts that make your company successful. People are usually much more excited about things when they feel a sense of ownership.
Be willing to compromise. Balancing a budget usually means everyone walks away from the table without something they wanted. In many small businesses, the owner gets too much at the expense of the business’ growth and vitality. Empowering a team and compromise help check that dangerous precedent.
Use these tools to plan now to successfully reach your monetary goals for 2009. A simple budget can make the mountain a cake walk. You may encounter some scary spots, but you’ll be prepared for them.
Call POSITUS. We’re here to help take you where you want to be.
Watch the video below to see one of the numerous rocks I climbed (and, yes, I know, it was more daunting to me than necessary.)

POSITUS Client Tim Tilley Appointed Ambassador

POSITUS client Tim Tilley, CEO of EnviroSep, has been appointed Economic Development Ambassador for the state of South Carolina. He is set to attend his appointment ceremony on September 15, 2008 in Columbia.

Governor Mark Sanford appointed Tilley because of his success with his company EnviroSep, which designs and manufactures highly engineered pumping systems in its facility in Georgetown, South Carolina. Employing over 40 skilled laborers and professionals in the Georgetown area, EnviroSep has designed systems for companies and developments all over the world, and their customers include Fortune 500 companies. Visit them on the web at http://www.envirosep.com/.

A little over 2 years ago, POSITUS began working with EnviroSep to formulate a strategic plan for smart growth. With less than a year to go in the planning cycle, EnviroSep has fulfilled our directives to seek larger, more lucrative projects and jettison unprofitable product lines. As a result, revenues through August 31, 2008 have already exceeded all of 2007. POSITUS has been tapped to formulate the next 3 year plan, a project we begin next week. We are excited to work closely with EnviroSep and congratulate them on their continued success.

Watkins Featured Speaker at CCPL

We've been tapped to do one of our favorite things - TALK.

We've been invited to give a program at the Fall Business Series at the Charleston County Public Library. We work with many small business owners who struggle with basic accounting concepts and cash flow management. We're going to compress our tips into an hour and a half presentation that you can have free for attending.

This presentation is for you if you struggle with any of the following:

1. Getting paid what you're worth;


2. Making people pay you on time;


3. Interpreting financial statements (or, you're now saying, "What's a financial statement?");


4. Evaluating client/customer relationships;


5. Definitions of bad clients/customers and ways to "fire" them;


6. Determining what real margins are for your products/services;


7. And as much more as we can cram into the time allotted.

Where: Charleston County Public Library, Main Branch Meeting Room

When: Monday, October 20, 2008, 7pm

Visit ccpl.org for more information.

Work in the Face of Disaster

We're all a-twitter (pun intended) here in Charleston now that hurricane season appears to be bearing down on us. Here are some reminders to get ready for a hit, (though Hanna is likely not it.)

1. Make a list of the things you must do in the event of an actual emergency and keep it handy this time of year. Some of the below may help.



2. Assemble a quick kit for your office, complete with plastic, blank DVD-R's, scissors, twine or string, tape, a Sharpie and any other items needed for quick security of your area. Keep it on hand throughout hurricane season.



3. Back up your computer either remotely or to portable disks/drives that you can take with you in the event you leave.



4. Store any important documents or other information in a location that is impervious to fire, flood and wind. As an alternative, you can make copies of these documents and/or scan them electronically. Then, you can assemble them in one place for easy transport.



5. Do not leave any sensitive items that could be damaged by water on the floor.



6. Take important information, like insurance policies and emergency contacts, with you.



7. Cover any items on your desk with plastic and secure it.



8. If you work with others, establish a contact tree with decision makers at the top. Provide detailed contact information, including mobile phone numbers, in case power and land line telephone service is interrupted. Once a decision about evacuation is made, information about work closures and return to work can be conveyed quickly with each person responsible for calling one or two co-workers with news.



9. Practice your hurricane routine with a hurricane drill.

It never hurts to be prepared. Take time now to prepare for an actual emergency before it is upon you. Without the stress, the process will be easy and will pave the way for less confusion when nature inevitably strikes out.

Be safe this hurricane season.