Predicting Accurate Sales Revenue for your Business Plan

 

Your business plan is your calling card. This is how you’ll be judged by potential investors and lending institutions. It has to be expertly prepared and you need to be able to stand by every projection.

The key word there is “projection.” For all practical purposes, you’re making an estimate as to how your business will perform. In the real world, those numbers can go up and down.

Predicting accurate sales revenues could make all the difference with your potential investor. Those numbers have to be realistic and rock solid. Here are the steps to take for making accurate sales predictions.

 

Step 1: Expenses

You’ll need to put together the list of fixed and variable expenses. These will include all the items you know you’ll be paying out for on a regular basis such as office rent, equipment rent, payroll, electric, phone and inventory (if applicable). You should also factor in the budget for marketing campaigns. It proves you’re being realistic about your business expenditures.

Step 2: Income

Here is where you’ll be doing the bulwark of your predicting. How can you estimate revenue when you haven’t sold your product or service yet? One approach would be to analyze the competition. What kind of business have they done in the past several quarters? If they are a public company you can find that information easily.

You might also have experience from a previous job that can provide projected sales figures. Your local Small Business Administration or Chamber of Commerce might also be able to help you.  

You should also analyze your own market. This is easier with a brick and mortar type of store than with an ecommerce business. Think of your business as a zone that attracts potential customers. What would be the average amount of customers who would visit your store or site each day? Of that number, what percentage would make actual purchases? Of that number, how much would they spend? This is how you shape projections. You should always strive to be conservative with those estimates so as not to over inflate your company’s value.

Step 3: Do the Calculations

Here the math is simple: You subtract your expenses from your sales projections. That is your profit margin and it’s the number your investors will be most interested in.

Whatever set of numbers you put into your plan you’ll need to make sure you’ve got backups for them. This can actually be explained as part of your business plan but it’s a guarantee you’ll be asked at some point, “How did you come by these figures?” You want to make sure you have a responsible answer.

How to be a Guest Speaker to Promote your Business

One of the most effective ways of getting the word out about your business is to talk about your business. That doesn’t necessarily mean stopping strangers on the street and passing out business cards (although that can work!). You should find ways to become a guest speaker. While you might not command those huge keynote speaker fees, you could volunteer to give a talk to local community groups or at trade show conferences. Those event planners are always looking to broaden their agendas and you’d be providing them a great service. Here are five terrific tips to help you become an amazing guest speaker to promote your business.

Get the Facts

 Know your audience. You should develop a kind of “stump speech” which is basically the same speech that can be delivered to any audience. However, that doesn’t mean you can tailor make that speech to fit a particular group. What you might be presenting to a group of senior citizens is different than to a group of high school seniors, even if it’s the same product. You should also know exactly how much time you’re allotted for your speech and when you’ll be “going on.” Additionally, if you require any special equipment like a projector or extension cord it’s always best to bring that yourself. Don’t count on the facility to have what you need.

Write Your Own Intro

Since you’re going to be introduced it will be best if you can position your biography and theme of your speech. Writing your own introduction can certainly be done with humility. It’s also a great relief to your host since they won’t have to worry about getting that information wrong.

Have Take-aways

It would be extremely beneficial if you can put something into the hand of everyone listening to your speech. Whether it’s a brochure, menu of services or even a refrigerator magnet, giving the attendees something with your company name and contact will be invaluable in terms of creating new customers. If you have something to sell immediately, like a book or other promotional items, make sure you clear it with the event planner in advance. Also find out if there will be other speakers selling stuff. You don’t want to be the only one selling.

Engage Your Audience

The best approach to giving a speech is to make it more like a conversation. Yes, you’ll be doing most of the talking but you don’t want to get stuck reading from a written speech or slides on a power point presentation. One of the most effective ways of engaging an audience is to ask them questions. You don’t always need to hear the answer but you’re getting them to think about your presentation by turning it on their own lives. That will make what you have to say resonate with the crowd.

Stick Around

Don’t just talk and run. If you have time in your presentation to open up the floor for questions, that will be terrific. Often attendees might prefer to pull you aside after the speech to ask questions. Stick around to meet the folks and find out more about them. Who knows? You might even be asked to give your speech somewhere else! 

How to use LinkedIn to get New Clients

 

While everyone is busy posting pictures of their pets and catching up with friends over on Facebook, serious minded business professionals are turning to LinkedIn as a way of staying connected with associates. They are also discovering the benefits of utilizing LinkedIn to expand their own customer/client base. There was a time when dedicated salesmen would have to “work the phones” to generate new leads. Today’s internet savvy sales force knows how to work the social media networks. Here are some tips to help you use LinkedIn to get new clients.

1)      Share the News

The worst thing that a potential new client or even a long time business associate should ask is, “What have you been up to lately?” If that happens then it’s clear you’re not using LinkedIn to its fullest extent. Whenever your business has a new product or venture you should post the details on LinkedIn. You can also send industry news that is relevant to your network or contacts. You can boost that announcement by adding a follow up direct message to your contacts asking for the time to catch up through a call or email.   

2)      Make the Connections

After you’ve established your own social circle of professional contacts on LinkedIn it’s time to go exploring. Spend some time every day reviewing who your contacts are connected to. Perhaps someone you once worked with are friends with a CEO you’d like to get in front of. Armed with this information you can ask for an introduction or use that connection as your “conversation starter” with the new contact. Either way, you’re expanding your reach which is what LinkedIn is all about.

3)      Track Down Former Co-Workers

Over in Facebook everyone is digging up old acquaintances from as far back as kindergarten. You should be doing the same thing on LinkedIn but keep it focused on business. Take a trip down memory lane and go looking for former business associates or fellow college grads. Where are they working today? Would that be a valuable connection to make?

4)      Ask for Introductions

Making a connection is easy but what if you want to gain access to a company where you have no network? You’re essentially making an old fashioned “cold call” reaching out to that company. Your network is the best bet to be introduced to someone within a company. Find out who knows who and ask for an introduction. The best thing about LinkedIn is that it allows you to see who is connected to whom.  This doesn’t mean you make a contact and then go for the hard sale. Let that relationship build. (See hint #1!)

5)      Join the Groups

Every member of the LinkedIn community has the opportunity to join groups built around common interests. Here is where the community really comes to life through ongoing discussions. Those groups could all contain potential clients. Get involved but keep it professional. The best way to connect with strangers is to create your own LinkedIn group. Revolve the group around a particular industry/category and invite your peers to connect and share. 

Your Personal Brand - Managing Your Online Reputation

A strong and well defined online presence can certainly move the “needle” when it comes to determining the success of a company. In many ways, your company brand is an extension of your own personal reputation – especially if you own a consultancy. For all the good resources and opportunities that the internet provides it can also be a place where negative reviews can have a lasting impact. Can you control what is said about your brand online? Here are some helpful hints about managing your online reputation.

Google Yourself

The only way to know what is being said about your company is to dive into a Google search. However, the occasional search won’t be enough to fortify your interests. Set up a Google Alert which can send you daily updates about any topic you create. This is a perfect way of staying on topic of mentions in blogs, articles or websites. Take advantage of Google Alerts, a free notification service by Google that tracks any keyword online and notifies you anytime there is an article related to that keyword.

Optimize Your Brand

Just because someone types your brand name into a search engine doesn’t automatically guarantee a positive result. What might appear at the top of a search engine ranking could be a negative reviewed from a disgruntled customer. When you consider that a recent study found that 89% of click throughs occur from the first page of a Google search, then you can see the importance of optimizing those results towards more positive trending. Search Engine Optimization or SEO is an area you should focus on for your online marketing campaign. The key is tracing back the links to your business from negative sources and improving the positive responses. There are many resources that can help you improve your rankings. It’s another proactive approach that should be at the top of your to-do list.

Make Social Media Your Friend

Anyone with a passing glance at the internet will no doubt come across some of the dozens of prominent social media networks. These areas are quickly becoming the “hot spots” where internet users spend most of their time online. You need to develop a strong presence for your brand on these sites as well. Facebook, Twitter, LinkedIn and Pinterest are all viable places where you can develop positive brand reputation.

Offer Quality Content

No matter what type of product or service you are selling online there is an opportunity to build out your brand by providing quality content for online users. An informative article or blog posts that relates to your brand which has been properly optimized can be picked up by search engines and draw traffic back to your site. That can only happen if you make an effort to create engaging content. If you feel that your writing skills are lacking, there are plenty of talented writers who can help deliver the kind of fresh content your website needs for strong SEO.

Finally, try to maintain a positive impact offline as well. A negative news story about your company can push all the hard work right off the first page rankings. By staying active in your local community, you can create positive buzz in on the local news front.

What Is The Biggest Threat To Your Creativity?

 

The biggest threat to your creativity could be staring you right in the face. The mere fact that you might be researching this topic means you’re stuck! It might be that the creative block hindering your productivity could come down to your attitude. If you consider the very act of “being creative” as a chore or something you dread, then you’re setting up a pattern of self-defeat before you even begin. That’s not being productive or creative. Here are some other things to consider that will help spark your creative flow:

Change Your Perspective

Try sitting in your guest chair for an hour while doing your work. Swap out the photos or art work hanging on your wall. Sometimes changing perspective can be enough to spark a creative idea. Even the smallest change can make a difference. If you have the chance to grab your laptop and head outdoors to the nearest java joint, go for it. There’s no telling what you might run into or meet up with that could help you rethink a problem and come up with a creative solution.

Change Your Chair

If you’re spending eight hours in an uncomfortable chair it’s no wonder you can’t be creative. Constantly adjusting your posture to find the perfect position is a distraction. That distraction can set off a chain reaction. If your chair is uncomfortable then it’s too hot or too cold in the office. Your shoes are too tight. You don’t like what you’re wearing. It goes on and on. Stop those kinds of distractions in their track and start by being comfortable in your chair. By the same token, don’t always sit in the same chair during conference room meetings. Mix it up and see what happens.

Change Your Office Space

There might be an unused area in your office that would make a great “think tank.” Bring in a couple of comfy sofas and chairs and let this be a break space that gives you and your coworkers a chance to get out and move around. This could also be a great place to share idea and get feedback.

Take a Break

We’re not talking about going for a cup of coffee or slice of birthday cake. Instead, think of ways to take an inspiration break. Is there a piece of music that always puts you in a good frame of mind? Is there a favorite writer who always gets you thinking? Load up some quotes or your favorite book in your iPad. Then schedule time to put your work aside and look from inspiration from those sources.

Write Everything Down

The only bad idea is no idea. You sometimes have to get through the dozen clunkers before finding that gem. That’s why when you’re brainstorming you should write everything down. Doesn’t matter if it’s a pad, a dry erase board or even a digital recorder - get it on record for future consideration.

Lessons Learned From Warren Buffett

 

When it comes to business success you have to admire Warren Buffett. Whether you agree with his politics or not, you have to admit he is an extremely successful businessman. He is now entering his 47^th year as the CEO of Berkshire Hathaway, one of the most trusted and profitable conglomerate of the modern business world. When Warren Buffett speaks, people pay attention. Here are some of the valuable insights that Buffett uses in his business practices every day. Can you adapt them for your small business?

Motivate for Success

Although Buffett has made a reputation as a master of acquisition he is also seen as an enormous motivator. He understands that a corporate culture is built on the success of managers at all levels. By acknowledging their successes you can foster a strong sense of loyalty and dedication that is key for your own business’s profitability.

In a recent shareholder letter Buffet wrote: "[We] possess a cadre of truly skilled managers who have an unusual commitment to their own operations and to Berkshire. At Berkshire, managers can focus on running their businesses: They are not subjected to meetings at headquarters nor financing worries nor Wall Street harassment. They simply get a letter from me every two years and call me when they wish. Our trust is in people rather than process. A 'hire well, manage little' code suits both them and me."

Take Smart Risks

You can’t build the kind of financial empire that Buffet has built without taking risk. However, that doesn’t mean entering into a contract or decision without being informed. Don’t act on “gut checks” alone. Instead, get as much information about every vendor, contractor or company you intend to partner up in business with. Once you make that decision, stick to it and let it ride out. Following a business plan towards success is about the long game.

Build a Strong and Trusted Team

No matter how big or small your business might be you’re not in this alone. Even if you’re currently the sole operator that doesn’t mean you shouldn’t seek out advice from trusted allies outside of your company. These loyal advisors could be considered part of your management team. The key thing to take from Buffett is that you’re only as strong as the people you surround yourself with. Who is on your team?

Embrace Your Mistake, Fix It and Move On

You’re going to make mistakes in your business. There is no way to avoid that. What you can avoid is dwelling in those mistakes at the expense of growth. Here’s how Buffett explained this lesson in a shareholder’s letter:  

"When I took control of Berkshire in 1965, I didn't exploit this advantage," Buffett wrote in his shareholder letter last year. "Berkshire was then only in textiles, where it had in the previous decade lost significant money. The dumbest thing I could have done was to pursue 'opportunities' to improve and expand the existing textile operation -- so for years that's exactly what I did. And then, in a final burst of brilliance, I went out and bought another textile company. Aaaaaaargh! Eventually I came to my senses, heading first into insurance and then into other industries."

What have you learned from Warren Buffett?

 

Will a PQ Minority Government affect the Economy?

 

There’s a new Premier in Quebec and she’s ready to roll up her sleeves and get to work improving the economy with her party’s plans. The Parti-Quebecois (PQ) squeaked by with victory that landed Pauline Marois in the proverbial magnifying glass. However, that narrow victory (54 seats out of 125) isn’t enough to hold sway. In order for truly sweeping changes, the PQ will have to build a strong coalition among the centrists and right-leaning party members. In many ways, that’s good news because it means a level of stability.

McGill economics professor William Watson put the election results in context during an interview for the Huffington Post. "It's not a bad election result (for business)," Watson said. "I think the program will have to be modified somewhat. I think there will be a push towards the left, but not as far as the program threatened." That’s going to be good news for the small business community who weren’t embracing those policies in the first place.

Marois ran on a platform of promising to pay for services by creating two new income tax brackets that taxed income over $130 000 and $250 000. She also wants to boost royalties and taxes on the various mining firms operating in the region. However, the bigger issue on everyone’s mind is a referendum on breaking away from Canada and becoming a separatist country. The last time the PQ was in control (1980 and 1995) they put forth referendums on the ballot but both times they failed. While that issue might be on the dock in the future, Marois states she wants to focus on the economy.

There is a sense among economists that this PQ victory could put a damper on direct new investment but there is no reason to think that established businesses will suddenly pack up and move off. Part of the reason is that minority governments like this don’t tend to last long. That allows for a “wait and see” type approach among investors. Most experts think that the election results won’t have an impact on housing prices as they are likely to remain flat.

The same is predicted for the Canadian dollar. Thanks to Quebec’s pension fund manager, Caisse de depot and the Bank of Canada there isn’t a chance the Canadian dollar won’t be propped up if it starts to drift downwards. Hours after the election the loonie value didn’t budge from its $1.0142 US. That’s a good sign of confidence.

As the reality of a slowly recovering economy settles in for Marois, some of her platform promises might have to be adjusted or jettisoned all together. Michel Poitevin, an economics professor at the University of Montreal, also commented to the Huffington Post about Marois’ platform promises. “Higher top-tier taxes, for instance, might prompt the early retirement of some of the province's most productive workers,” he warned. “Any party that would have been elected would have had to make tough decisions. I guess for the PQ, maybe it's going to be harder internally because of all the promises that they made."

Never Stop Marketing your Small Business!

When it comes to a weak economy we’re all in this together. Yes, it’s true that some businesses manage to stay afloat when times are tough but is that because they are selling something we can’t live without or is it just good marketing? Evidence would suggest it is the latter. The knee-jerk reaction for any small business in a tight economy is to cut costs. However, you don’t have the luxury to sit on the sidelines - You should always keep up your business presence through your marketing campaigns. Here’s why:

The benefits add up

Your bookkeeping records don’t lie: You know when you had a spike in business. Can you trace that uptick to a particular event? If you sell umbrellas and a storm rages through the community then you can thank Mother Nature. Most other upticks in business can be attributed to some piece of effective marketing you engaged in whether that was a coupon, a contest or even a powerful tweet. Build on what worked in the past and embrace the idea that those benefits can be achieved again.

Your competition isn’t stopping

As mentioned, we all share in the economic burdens but that doesn’t mean you should surrender your business to the competition. Do you think they are slowing down their marketing campaigns? Even if they stop marketing, you could take advantage of the downturn to out-market them.  Beat their prices. Offer what they can’t. That’s the way to stay competitive.

Be on the lookout for growth

The best case scenario for any business is to corner-the-market. That means they’re the market leader in their industry. Even the market leader can still experience stagnation if they don’t continue to grow and innovate. Keeping up your marketing provides you with the opportunity to expand your customer base. That’s really the only way to climb out of the economic doldrums.

Think about the long game

A successful marketing campaign isn’t just about a quick infusion of cash. Although that’s going to help, you really want to think about the long game of your business success through aggressive marketing strategy. With those campaigns you’ll be building up a strong brand identity and increasing your customer base. Suppose you ran a contest and succeeded in signing up a thousand entrants? That’s a thousand names you can send email coupons three months from now. When the holidays roll around you’ll be able to send out another blast to remind those folks of what you’re offering. Now you’ve got a consistent business. That can only be achieved if you keep your marketing going. 

Using Content Marketing To Drive Credibility

Raspberries.

 

What does creating original content have to do with raspberries?

 

Nothing. But the mere fact that the word “raspberries” has been randomly dropped into this article is proof positive that this is a piece of original online content. There are plenty of computer programs available to cut corners by churning out robotic content for websites. While those articles are loaded up with facts and figures they won’t have “raspberries:” that original creative flair. That’s what you should be striving to put into your content: originality.

Search engines are getting smarter. Google has launched several algorithm upgrades – the Penguin and Panda updates - which specifically targets websites that produce “spam” content. The Google spiders can tell the difference between an original piece of online content and something that has been “spun” or pasted together with a computer program. The new algorithm updates not only the take a look at the structure of a sentence, they also analyze the relevancy of content , the number of backlinks to the website, the number of times that an article or content gets shared using social media and so many other factors.

Guess which content goes to the top of their rankings? That’s right; it’s the original content. Google wants its users to receive maximum benefit from its searches and you should want the exact same thing for your online visitors. The best way to build up your company brand is through great content that your readers want to share. Here’s what you need to consider with every piece that you write or create:

Teach and Entertain

Readers go online to do two things. Be entertained or find a solution to a problem. Once you have an understanding as to what your target audience wants to do online, you can create the right piece of content that will attract your markets’ attention.  In other words, choose whether each piece that you write or create is going to be informative or fun to consume. You can’t solve all the world’s problems but when it comes to your little corner of cyber space you should be providing solutions that meet their immediate concerns. You should also provide a reason for those users to return to your site. That will only happen if you can put a smile on their face with your content. Get cheeky with the headlines. Don’t shy away from quirky graphics. You can still maintain a professional presence but keep it human and not robotic.

Build Trust and Credibility

Thanks to those Google algorithms, internet surfers are becoming a savvy bunch of readers. They can also quickly spot a “spam” article. Loading up your site with content for the sake of content is going to turn off that visitor. You might not make a sale on that first visit but if you plan your content marketing campaign (or a drip marketing campaign), you can slowly build up trust by creating original content that your target audience will want to read.  Your audience wants to find a reason to not do business with you. So, make sure that any content that you produce specifically targets your intended audience and their needs. When you’ve built that trust they’ll be coming back again and again.

Start a Conversation

With the advent of social media, email and blogs, we get the chance to join and be part of any community. This means we all have a chance to share our experiences and opinions. Give your users that opportunity by inviting them into the discussion. Your content should end with a call to action, whether that’s a link to more articles on your site or a question inviting the reader to leave a comment. Or even sign up for a newsletter. When you engage readers to share their thoughts they’ll come back to see who is commenting on their comments. That’s how you build an online community.

Questions? Feel free to ask and we’ll do our best to answer. (See how that works?!)

 

Lessons Learned From Pitching Venture Capitalists

 

Raising money is as much a part of business as the goal of making money. As the old adage goes, “You’ve got to spend money to make money.” There’s an even older adage which posits, “Never use your own money.” One of the most popular sources of funds – especially for startups - is venture capitalists (VC), those who provide money in exchange for large ownership stakes.
 

Due to their popularity, VCs are extremely busy and hear thousands of pitches in a month. Out of that many, they invest in only in handful, hoping for a very lucrative exit in a short amount of time. To pitch a VC for financing requires the founders of a startup to not only be well versed in their own companies, but also do extremely detailed research on their potential investors. Not doing your research will make the difference in getting funded millions of dollars or being delegated to the black hole of has-beens. The following tips are some valuable lessons to learn about pitching VC’s and getting your startup funded.  

            Do Your Homework

Every venture capitalist you’ll be pitching to has their own distinct personality. You need to get as much background information on that potential investor as possible. Don’t just Google them but ask around – especially other investors. Do they have a short attention span? Would they prefer to see the bottom line numbers first and then the “sizzle?” What other successful businesses have they invested in? Why did they make those investments? In many ways, you’ll be giving the same basic pitch to every venture capitalist but if you can adjust to their investment criterias and individual personalities you’ll be ahead of the game.

Be Smart With Your PowerPoint

One of the most popular (and easy to use) skills for any business owner to have is the use of the PowerPoint presentation. This is not something you should be slapping together the night before the big pitch. Instead, it’s something you should be developing since the inception of your business plan. An effective PowerPoint presentation can’t stand alone. You’ll still need to “narrate” to fill in the gaps from your bullet points but you shouldn’t become top heavy with data. If you can make your point with a strong visual then go for it. Before building your PowerPoint, go online and view other presentations. Take note of what you like and “borrow” the idea.

Have a Thick Skin

Every entrepreneur walks into a VC pitch with dreams of walking back out with a check. That’s not going to happen. What will happen is you’ll be grilled aboutyour business. This is a good thing. The more you can engage that investor the better off you’ll be. Make sure you listen clearly to any question and think through the answer before blurting out something you think they want to hear. You’re not going to get the same reaction twice. Don’t let that throw you. Remain confident in your proposal and if they don’t bite move on to the next investor.

 Pitch the Facts

It’s great that you have conviction about your business idea but you can’t let that passion become pie-in-the-sky thinking. Over-valuing your company is the quickest way to turn off an investor. If you’ve got grand assumptions to make about business projections you better back it up with more than sweeping generalities. Just because the dog food industry is a multi-billion dollar business doesn’t mean your brand of dog food is guaranteed success. Sell your passion but back it up with the facts.