Here Comes 2015!: What Do You Still Not Know About Your Business?
Now that we're nearing November, it's time to refocus on the business with an eye toward planning for 2015. I'd like to suggest that you look a little farther ahead and reflect on the issues I've outlined below.
Over the years, I've encountered far too many business owners who spend weeks planning their vacation (if they take one at all!) and virtually no time planning for the business that makes those vacations possible.
Watch cable news, scan a few TV commercials, or flip through any newspaper these days and it would seem there are no mysteries any more. Let's face it, we know far too much about far too many people's habits, problems, and proclivities. We have more factoids, tidbits, inklings, stats, blogs, and so-called expert opinions (legal and otherwise) than we can use in a lifetime. That is, except when it comes to the workings of our own business--most often our single biggest investment, the entity into which we've poured a lifetime of efforts. Yet at the core, it can be as mysterious as the bottom of the sea.
Here are some of the more interesting "unsolved mysteries" we've encountered from conversations with business owners:
- "Why am I so confused over what my profit was for the last 3 years and what my actual inventory is at year-end?"
- "Why does my balance sheet show a negative net worth, and what can I do about it?"
- "Why does my new banker insist that I pay off my credit line now?"
- "When are Mom and Dad finally going to retire, and which of my siblings will inherit the business? Is there a written buy-sell plan in place somewhere?"
- "Why do I feel like my dad's CPA gives me the run-around when I try to get answers?"
Forcing the issue
We've found there's a consistent process in unearthing and resolving these mysteries. Here are a few of the major ones we've found over the years:
- Catalyst events. Death, illness, and infirmity bring transition issues to a head. Lack of previous planning usually brings unpleasant surprises.
- New banker in town. Credit lines need to be paid off, timely and accurate financials submitted, and questions answered.
- Joining an industry peer group. Especially when you have to share your financial data and, as they say in the biz, "Get naked in front of your group." You start seeing your business, muffin tops and all, and think about a plan to get it in shape.
- Declining markets/increased competition. Nothing like that new chain coming to town to get you on your toes!
- New outside advisor, CPA, or coach. A good sign is when you hear them ask, "That's interesting, can you tell me why you handle X that way?" way before you start hearing any advice.
- Defining moment. It could come from a great book, a peer who has successfully faced the same issue, or someone who kept their head in the sand until it was too late. If it doesn't come from outside influences or events, sometimes it comes from within. The simple question, "What am I going to do today to make things different tomorrow?" is where it all starts.
- Bring in an outside party if appropriate. We can't tell you how many times we've seen an apparent irresolvable family business dispute resolved when a skilled intermediary is brought in.
- Where do you go from here? You can't do it alone. Get help. Join a peer group, find someone who's been there, done that, and/or assemble a great team of advisors.
Be determined. Don't take no for an answer, but be patient. If your financial statements are a mess, it will take some time and patience to get them accurate. Keep the faith that it will happen, just not overnight.
Realize it's usually the question you are most afraid to ask that must be answered. Take a minute now to write down the answer to this question: What am I pretending not to know?
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