Must-Dos for Startups
Advice from local professionals for the New Year.
A new year is upon us, and with it comes fresh opportunities to seize, such as launching a new business endeavor. While daring to venture onto a new path is noble and exciting, it’s important to remember that there’s not just one solitary secret to success that applies to all.
When starting a company, small or large, it could be any one person’s two cents of guidance that leads to a windfall of pennies from heaven. So grab an umbrella and follow the wisdom, insights and tips of industry veterans and forecasters.
Have a Business Plan
Devising a business plan is the standard first step that an entrepreneur must take for a good reason. A solid plan is as important to a business owner as a playbook is to a coach and can be as gospel as the Bible.
“Have a set business plan that is written down,” recommends Blake Gillies, vice president of risk management for Wealth Solutions LLC. “It’s easy to get lost in the day-to-day of business and it’s important not to lose sight of both long-term and short-term goals.
“I suggest the One Page Business Plan System,” Gillies added. “Secondly, find a Center of Influence group and work on ways you can help one another. Especially if the owner is also the sole employee.”
Secure Ideal Employees
Patricia Ann Besselman-Main, managing partner of Besselman & Associates, believes one of the most important keys to sustaining business success is attracting qualified employees.
“In lieu of a high salary, a startup may want to negotiate incentive bonuses and pay raises that won’t overload the business with expenses that will drain the startup cash reserve,” Besselman-Main said.
Along the lines of incentivizing and attracting qualified employees, Besselman-Main noted the drawing power of employee benefits like health insurance and a retirement plan, but advised that, “In lieu of draining startup cash, a company should offer modest benefits until the company is producing consistent income.”
Don’t Cheap Out On Insurance
According to Chad Kropp, risk architect with Insurance Underwriters Ltd./IUL Risk Solutions, before starting a new business one “truly needs to understand that insurance will be in the top three of their costs.”
Kropp warned that the most overlooked coverage is employment practices liability insurance (EPLI).
An important form of protection for any company, EPLI is especially vital to startups that have yet to establish industry roots. The purpose of this type of coverage is to guard companies from losses that may arise from an employment practices dispute involving claimed discrimination or wrongful discipline.
Another matter for entrepreneurs to consider is the recent uptick in ransomware (a form of cyber crime where data is ransomed) that has been hitting retail, hotels and even hospitals. Kropp said that the best tip he has for all businesses, not just startups, is to acquire cyber liability insurance as a precautionary measure against would-be hackers, who are willing to “hold your company hostage for $40,000 to $50,000.”
“In lieu of a high salary, a startup may want to negotiate incentive bonuses and pay raises that won’t overload the business with expenses that will drain the startup cash reserve.”
Patricia Ann Besselman-Main, managing partner at Besselman & Associates
Account for the Future
When creating a budget for business expenses, Joey Richard of Richard CPAs, said that one should first ask, “What does the company gain for the money and time invested? And is the investment of time and money worth it? Buy what you need versus what you would like. Do not overbuy. Shop prices.”
Richard stressed that a major component of managing for the future is accounting for the “growth potential for the company.”
“Detailed written plans provide evidence of sufficient analysis and care for the plans to be achievable,” he explained. “A detailed written plan provides you with important milestones for your short- and long-term goals. Make sure you are making your sales goals and that your customers are happy with your product and service.”
As sales goals are met, Richard believes it’s critical to use profits to first “adequately compensate investors and owner-employees.”
Moreover, he said, “Investor profits should be balanced between long-term and short-term returns. After that, profits can be used to grow the business.”
Find the Balance
“Balance is important in everything,” said Keith Gillies. As CEO of United Wealth Advisors Group, managing principal of Wealth Solutions LLC, and president of the National Association of Insurance and Financial Advisors of Greater New Orleans, Gillies travels about 200 days each year.
In order to find balance, Gillies shared his tips. “First, no wasted motion. I catch up on emails and other tasks while waiting in airports or on planes. Also, after a nice morning walk, I try to work an hour or so while in hotels.”
Gillies said he tries as much as possible to coordinate travel with personal priorities.
“With my son playing baseball at Tulane, I will coordinate travel with their away schedule.”
Stay the Course
While living in the mobile era is a blessing, it can also present many distractions. To minimize interruptions, Chris Ferris, executive vice president of Fidelity Bank, suggested, “Turn off the pop-up that alerts you that a new email has come in and designate certain times of the day to check and respond. It’s also helpful to make a list of what has to be done that day, and the old management rule of only touching a paper once still applies.”
Another way to stay the course is to take part in seminars, programs and other business related events. Locally, Ferris feels a great place to start is New Orleans Entrepreneur Week, March 20-23, 2018.
“New Orleans Entrepreneur Week is a great resource and Stay Local is always putting on valuable workshops at a very low cost,” he said. “It can never hurt to learn more about social media and digital marketing as the landscape is constantly growing and changing. At Fidelity Bank, we have a special program called P.O.W.E.R. that targets women in business. We will be publishing a monthly event calendar of things happening in the city that benefit women in business, so this will be a great resource for the woman business owner.”
In business, relationships are everything.
“It’s important to have a banker that understands and wants to learn about your business,” noted Ferris. “Also, there are a number of small business incubators in the city and nonprofit organizations that can provide valuable feedback. It’s important to get involved in the business community. By being involved, you will meet other like-minded individuals that may have shared some of your experiences and can offer solutions.”
During a startup’s first year, Ferris advised that it’s particularly important for an entrepreneur to “know what your goals and milestones are. How will you define success? Knowing and writing down your goals and communicating them to your key employees or business partners is important. Everybody working for your business should be able to articulate what those goals are and work with you toward achieving them.”
Advice from a Frequent Flyer
As CEO of United Wealth Advisors Group, managing principal of Wealth Solutions LLC, and president of the National Association of Insurance and Financial Advisors of Greater New Orleans, Keith Gillies travels about 200 days each year.
He offers entrepreneurs the following advice:
1. Be a loyal flyer.
“Pick an airline or two” he said, noting that consolidating your flying will help business owners gain status for free upgrades and other amenities.
2. Find a good credit card.
“I find the Business Platinum Amex is a great card,” he said. “I take advantage of every benefit.”
3. Join the clubs.
Some of Gillies recommendations for frequent flyers include seeking out auto gold hotel status with multiple hotels and joining Delta Sky Club and National Car Rental’s Executive Elite.
“All of these types of tools and techniques provide upgrades and save money,” he said. “I eat in the Sky Club and drinks are free. Gold status gets you meals at very good hotels and you can rent cars at the cheapest rate and drive off in luxury.”