Ready to open a new Shop? 18 Tips for a grand opening!

1. Create a budget for the grand opening. Creating a budget that will allow you to have a successful grand opening, but is separate for the monthly advertising budget.
2. Select a grand opening date immediately. By selecting a date you can now properly prepare, plan, and schedule special guest for the grand opening in advance. You can inform customers, vendors, and staff months earlier and create a buzz about the “big grand opening event”.
3. Check local government regulation regarding advertising signs, inflatable, or marquee that you use to advertise your grand openings. Some communities have regulations and permits maybe required to have a large purple inflatable gorilla, advertising a grand opening in parkway.
4. Make it a business-to-business grand opening. Send out special coupons to local businesses – networking with business and create business accounts. Allow owners to enter the night before the grand opening to preview the store.
5. Create customer loyalty from the beginning. Offer special incentives for returning customers who shopped prior to the grand opening. If a customer brings in a receipt dated prior to the grand opening date, give the customer a special prize or discount for being a loyal customer.
6. Hire a promotional entertainer. Promotional entertainment is about gathering crowds, getting a message heard, registering people, and for that you need a professional entertainer.
7. Have maximum staff on hand. Make sure your sales staff is fully knowledgeable about location of products, store hours, and store layout.
8. No waiting at registers. Plan for crowds to come and buy. Have all the registers open and have entertainment available to entertain the waiting customers. When people are happy they don’t mind waiting in line. Have a comedian, promotional entertainer, or band to entertain the customers waiting in line.
9. Network with adjacent business. Because you already have the grand opening date scheduled you can work with local business to create flier swap weeks in advance. Local takeout restaurants can give away fliers with each order in exchange for giving out their fliers to your customers.
10. Contact local government and the Mayors office and request they participate in the ribbon cutting ceremony. Politicians love to make public appearances for local business and you should invite as many as possible.
11. Contact local newspapers and talk to the editor to inform them about the new business coming to the community. Highlight the benefits that your company will bring by either providing a needed service or jobs to the community.
12. Encourage local religious and group leaders to attend the grand opening. Let them know that your business is there to help support them and their parish.
13. Blessing the business and those who come. Invite local religious organizations to attend prior to the ribbon cutting ceremony to bless the business. Religious leaders can invite parish members to come and participate in the special event.
14. Contact colleges and college students to participate in the grand opening. Invite them using a quiz show and make a crowd at the grand opening. As most of the purchase decisions are done by students these days it can be decisive.
15. Arrange a singari melam at grand opening. A good singari melam can announce the opening in the most keralite style.It can attract people and inform them about the opening.
16. Vendor sales presentations to education consumers about products. Vendors and manufactures have qualified sales staff that can assist in the grand opening to educate consumers about their products and how to best use the merchandise.
17. Talk to manufactures and vendors and see if they would provide grand opening support with signs, banners, or sponsor food booths.
18. Prepare a plan. Prepare a plan for the launch day with allocating responsibilities to each and delegate it.

Are you planning to name your company? Ask these 10 questions yourself!

1. Who are my consumers?
2. What am I naming?
3. What type of a name do I want?
4. How long should the name be?
5. Do the sounds in the name have the right appeal?
6. What associations should the name evoke?
7. What are the foreign language implications of the name?
8. How should I test the name?
9. How will the name appear in directories?
10. Can I trademark the name?

How to sell effectively?

Imagine what it would be like if your marketing was consistently bringing you exact replicas of your most profitable and enjoyable clients...
You don't realize it yet, but in a few minutes I'm going to share with you a wickedly effective process for measuring your prospects before you ever decide to bring them on as clients.
You probably know that to test the purity of a water source your testing equipment must be calibrated; without calibration there can be no way to produce accuracy. Likewise, business owners often are trying to gain new clients without any clear focus or intent.
You see this blind-spot everywhere, definitely not in your business, but just take a look around. In many PR, marketing or branding firms (sorry guys, its true…), you will see this lack of focus glaringly reflected in their online portfolio. Upon further exploration, you would probably discover a monster-sized range of different clients.
You probably know, maybe from your own experience, that these business owners rely on referral business only. Believe me, they would market if they could. If you asked them, they would probably tell you,"I would market, it’s just impossible to find where my prospects are located." OR "Paying for advertising is not profitable for my kind of business."
And they would be right because they have created this reality from a disempowered place of negligence. They have neglected to focus, to calibrate their marketing so that they can create a genius strategy that clearly shows which tactics will be most profitable.
Are you beginning to see how negligence could be impacting your business? But get excited, there is something you can do TODAY to get unstoppably focused. And it all starts with the ideal client profile.
The purpose of the ideal client profile is to help you focus on the prospects with the greatest likelihood of becoming your new stress-free clients. The ideal client profile will serve as your calibration device, showing you how to accurately spend your time, energy, and budget to demand the highest possible ROI.
Any business owner who is operating their business without a focused and clear ideal client profile is being negligent, but I would NOT say they are incompetent unless they read this article and do nothing to change it now.
Let's just face the fact that when we are starting out in our business often times we don't want to limit ourselves, so we keep ourselves open to receive as many new clients as possible. Saying to ourselves,"I'll work with anyone!"
But as you read on and begin to integrate this distinction you will learn that this "cash & a pulse" mentality will seriously keep you from making a certifiable killing in your profits.
Before long you understand how clarifying your ideal client profile can help you get even more focused. And that by doing so you actually take ownership for the kinds of clients you decide to bring on.
If this sounds like something you would like to know, check out this process for identifying your ideal client profile:
1. Rank. Create two different lists that rank your clients by; Most Profitable and Easiest to do Business With.
2. Evaluate. What are the characteristics of each client? Attempt to determine why the top five clients are on each list.
3. Identify. Think about the key attributes that your best clients and worst clients share. What characteristics link the best? And what characteristics link the worst?
After completing this process you will likely find that those at or near the top are accurate reflections of your ideal customer profile. Take the top clients and build a more detailed profile.
Populate the above profile with the following information:
You Sell to Businesses...
*Annual revenue
*Number of employees
*Level of contact you are working with and in what functional area
*Local, regional, or national
*Business situation, i.e., is the company in growth or decline?
*Psychographics (The corporate values, culture, philosophy, and leadership)
You Sell to Consumers...
*Age
*Gender
*Race
*Ethnicity
*Geographical location
*Annual household income
*Psychographics (How do they get gratification in their lives? What is their dominant justification for making a purchase? What are their top 20 pains?)
Having a clairified ideal client profile is one way to generate more business and save yourself valuable hours. The ideal client profile is but one piece of a larger lead generation system. I hope at this point you have expereinced the value that can come from working ON your business. If you have ever wanted help creating a strategy or focusing your energy to get more done in less time, then ask for help.

How to find financing for your new business?

SOME GREAT LINKS!

Business Forms [3]

• Sample Bank Loan Application & Review Forms
• Sample Personal Financial Statement Application
• Sample Unsecured Promissory Note

Resources [4]

• Approaching Investors Doing the ground work
• Currency Risk Management-Export Transaction
• Microlending Resources
• Raising Venture Funding – Kick starting the process

Tools [1]

• Loan Payment Calculator

How-To Articles [5]

• Business Valuation Methods
• Give Yourself the Money Hunting Edge
• Leasing Equipment
• Managing Debt
• Trade Payment Mechanism

Training [1]

• How to Finance Your Business

4 Simple Steps to systemize my/your business

Step 1:  I Identify the top three activities that cause me the greatest frustration

Step 2:  Next I identify what the outcomes are that I am wanting to achieve with each particular activity that is causing me pain and frustration and I make sure I’m really clear on the outcomes I am wanting to achieve before I go into problem solving mode

Step 3:  I ask myself “What is the root cause of this frustration” and I keep asking myself this question until I come up with an answer that is not based on the person (me), or my VA, but rather on the process.  So, the answer as to what is causing the frustration should be that there isn’t a consistent, set way for doing it each and every time, and that you need to create a standard for performing the activity

Step 4:  Next I think in terms of what type of system would achieve each of the outcomes that I am wanting and I take one at a time and mindmap it out with the steps needed in order to achieve that outcome

HOW TO SET CREDIT LIMITS?

Credit Limits. Are threshold that a company (creditor) will allow its customers to owe at any one time without having to go back and review their credit file.  Credit Limit is the maximum amount that a firm is willing to risk in an account. 

Credit Limits helps the creditor in the following ways:

1.      It frees up valuable time for other credit management tasks

2.      It speeds up the sales process

3.      It reduces risk and improves collection activity and efforts.

4.      It is an account monitoring tool

Credit limits have also known to upset customers. Thus, the decision to communicate credit limits to your customers rests upon you. It has its advantages and disadvantages.

One important approach that credit management should take with customers who are near their limits; asking for more or with overdue amounts is that of a counselor. This is the time to collect more information on your customer or cajole them into paying overdue amounts.  Credit Limits need not be Sales Limits and should be used as a guide to enhancing profitable sales. They can be flexible and revised often. 

Issues to consider when setting Limits

The first thing that the company needs to consider is its own exposure.  What is the kind of exposure that a company can take with its customer base? Will it be a Liberal or a ‘Conservative’?

Important factors influencing these elements will be

·        The strength or weakness of ‘Product or Service’ that is being sold;

·        The degree of ‘Competition’ or ‘Opportunities’ in the marketplace; the nature of the industry that you are in or deal with- Is the industry growing or going? Your role as a supplier, especially if you are the key supplier to your customer.

·        Whether you are a ‘Secured’ or ‘Unsecured’ creditor. If there is any lien rights that you can exercise.

·        The financial strength of your customer; the information that you have or can obtain from your customer or other sources. The number of years that the customer has successfully run that particular business and the reputation carried in the marketplace, both of the business and its management. The customer’s businesses plan or blueprint to operating the business in the future.

·        The overall ‘Margin’ that the product or service contributes to the bottom line;

·        The confidence that you have in your in-house ‘Collection’ process;

·        The length of your terms to your customer because risk is directly proportional to the length of your terms 

Another vital question that senior management in the company need to answer is: How much of their working capital are they willing to employ in their customers? Often companies forget to first evaluate these questions and get themselves into a cash crunch situation. 

Methods of Setting Credit Limits

As indicated earlier setting credit limits is not a science. Although, by incorporating the process into their scoring models some companies have made it into a near science.  The starting point to setting most credit limits is the needs and requirements of the customer. What is the customer asking for and subsequently what will be the requirement periodically? If the customer is creditworthy then would you as a customer want to set the a credit limit for the customer higher than what is being sought in order to save time in the future i.e. if credit limits are to be increased later due to increased sales volume? 

The following are some common techniques applied in setting Credit Limits:

Trade References: After obtaining the trade references you can compare the amounts of the High Credits awarded to your customer.(applicant) You can choose the ‘Highest’ from the ‘High Credits’ or take an ‘Average’ or pick the ‘Lowest’.

Bank References: In doing a bank reference on your applicant find out the amount of line of Credit that was established by the applicant with the bank. If this line is unsecured then perhaps it can give you a little more comfort in setting a relatively higher credit limit for the applicant. The use of this information is rather sketchy since the banks generally are secured creditors with stiff remedies upon default.

Agency Credit Reports: Credit Agencies generally give two pieces of information that are quite popular among credit professionals that aid in the setting of credit limits.

1.      Payment Performance: This section lists the paying habits of the applicant. The information is collected from different suppliers to the applicant. You can treat this section almost like doing a trade reference. It will give you High Credits and the customer’s (applicant) payment habit in different dollar ranges. It is quite possible that the customer might be a good paymaster in the dollar range that is being sought from you as a credit limit. Thus, increasing your confidence level.

2.      The Rating: Based on certain credit and financial information obtained on the customer (your applicant), the Agencies assign ratings. These ratings can assist you in setting your own credit limits. You can map your own limit amounts against individual ratings that a credit agency assigns.

Financial Statements: Financial statements are also used in assigning Credit Limits to customers. Mainly ratios or factors like net worth and working capital are taken and trended or compared to Industry norms or standards. If a customer shows liquidity and efficiency as per industry norms then a more confident approach can be taken in setting the credit limits. One has to also consider if short-term liquidity is important or meaningful to the nature of your credit or is long-term liquidity more consequential.

For Example: Some companies will take the ‘Tangible Net worth’ [Total tangible assets – Total liabilities. From the Balance Sheet] and assign anywhere between 5% to 15% of the Tangible Net worth as a credit limit for the customer provided the customer has shown pre-tax profits. Others consider Net Working Capital  [Current Assets-Currents Liabilities] because it measures the short-term liquidity of a company.  While doing such analysis on has to also consider elements outside the domain of the financial statements before making a conclusive decision.  For example the company that is being assessed might have suits or judgments against them. On the other hand the financial statements could be unaudited or company prepared.

Another ratio that is of importance to lenders is the ‘Debt to Equity Ratio’. The ratio is typically calculated by combining noted payables and all secured debt (such as short term and long term bank loans and debentures) and dividing it by net worth. The ratio shows how the company is leveraged and illustrates the stake of the lenders as opposed to the owners. A secured creditor (like a bank) may request to maintain a certain level of Debt to Equity. Otherwise upon default such loans become payable upon demand, which could lead to sale of assets to prepayment of the loan. If this ratio is within industry norms and to the satisfaction of the secured lender then a more liberal approach can be taken in setting the credit limit for this customer. The contribution to the credit limit can range anywhere from –5% to 15% of the customer’s Net Worth.

The Days Sales Outstanding also known as D.S.O is a rough indication of the quality of a company’s receivables.  It is calculated by dividing the net receivables by average daily sales. If the DSO is in line with the norms for the industry then  a liberal approach can be taken in setting the limit for this customer. The formula that is used with DSO is that, for each day of deviation from the norm or the selling terms you add or subtract .10% of the Net Worth.

Past Performance:: Credit Limit in this case is based on the past history of the customer as per the information contained in your books. The two elements that you would consider and weigh would be the past:

·        Payment performance

·        Purchase Pattern

Need Based: In this case Credit Limits are set based on the needs of the customer. It could be set to accommodate the first Requested Credit Limit or the Size of the first Order: It should not be done in isolation but by a combination of the other methods that are discussed in this article.

In a survey that was conducted by the Conference Board one of the most popular techniques used for setting credit limits was by using the information and ratings given by credit agencies.

ECOA and Credit Limits:

In the United States of America, creditors should be aware of the provisions under the Equal Credit Opportunity Act. (ECOA) when evaluating Credit Limits. The act would particularly apply to the notification of ‘Adverse Action’. The term "adverse action" is defined as follows:

     (i) A refusal to grant credit in substantially the amount or on substantially the terms requested in an application unless the creditor makes a counter offer (to grant credit in a different amount or on other terms) and the applicant uses or expressly accepts the credit;

     (ii) A termination of an account or an unfavorable change in the terms of an account that does not affect all or substantially all of a class of the creditor's accounts; or

     (iii) A refusal to increase the amount of credit available to an applicant who has made an application for increase. The definition is further clarified to exclude from the definition of adverse action: Any action or forbearance relating to an account taken in connection with inactivity, default or delinquency as to that account.

Unless otherwise excluded, business credit grantors must give notification to business credit applicants of adverse action depending on the gross revenues of the applicant. Therefore, disclaimers in your credit application are of importance and relevance and should be reviewed by your legal counsel.

Thus, setting limits is a somewhat complex decision making model. There is no perfect way of figuring out limits nor will there be one, but within the limitations of credit management this is just one more element in the daunting challenges amidst which a credit professional operates.

Source: Creditguru.com

How to manage your purchases? Some basics!

It's easy to neglect the area of purchasing in your business. Of course you buy goods and services, but you don't always plan the purchases as well as you could. As a result, you may spend more money than they need to, buy goods that aren't of the proper quality for your needs, or choose suppliers that don't offer the level of customer service you deserve.

If you fail to devote enough attention to your purchasing, your cost of doing business could rise to an unnecessarily high level. As operating expenses increase, profit margins shrink, you would either have to live with lower profitsor raise your prices, and neither of these choices is appealing. By keeping your costs under control, you'll be able to keep your prices at competitive levels and maintain a desirable profit.

Purchasing Policies

To purchase wisely, you need to buy the right quality and quantity of materials or products at the best possible price and at the appropriate time from the best vendor.

Purchasing need not be the purchasing manager's sole duty; in fact, your business may not do enough purchasing to require a full-time purchasing manager. You should select an employee who can handle purchasing, as well as the other duties he or she my already have. This individual should be able to communicate clearly with your business's suppliers. Although purchasing duties probably won't occupy all of this individual's time, there is more to purchasing than placing orders. The purchasing manager will have to gather orders, make sure they are complete, and stay within any limits the company may have set on spending, select an appropriate vendor, order the goods, check their condition upon receipt, make sure the invoice is correct, and speed payment of the invoice by forwarding it to the accounting department.The purchasing process is much more streamlined in small companies than in larger businesses, especially when the businesses are still fairly new. The owner usually decides what to buy, when to buy, where to buy, and how much to buy. As the business grows, however, the owner may no longer be able to handle this task and will have to delegate it to others. While a small business probably won't need to create an entire purchasing department, it will need to have a purchasing manager. By selecting one person to manage all of the business's purchasing activities, you will decrease the risk of duplicating orders for the same materials.

Before you delegate the purchasing function to another employee, you should write out a purchasing policy for your business. You may even want to create such a policy while you are still responsible for purchasing, as a guide for yourself.

The purchasing policy, according to the SBA, should answer the following questions:

• Who has the authority to purchase items for the company? What items can that person purchase? Are there any spending limitations?
• What are the business's requirements for adequate supplier competition and what criteria will be used to select possible vendors?
• What is the company's position on the acceptance of gifts?
• Which types of contracts can the business enter into with successful bidders or vendors?
• What is the company's position on conflict of interest and personal loans from suppliers?
• What kinds of information does the company consider confidential?
• What is the procedure for dealing with legal questions?

The Ordering System

The steps your employees and purchasing manager will follow to request, order, receive and pay for goods and materials make up your ordering system. A good ordering system will help maintain satisfactory supplier relations, improve cash management, aid in inventory control, and increase the overall profitability of your company.

The Purchase Order

Once the purchasing manager has received a requisition, her or she will need to select a supplier and check the price of the items ordered. After agreeing on a price, the purchasing manager will send a purchase order to the supplier. This order is a formal request to the supplier to deliver materials or supplies according to the terms and prices agreed upon. Purchase orders, like requisition forms, can help small businesses keep track of their purchasing activities. Firms can refer to their purchase orders to see if suppliers have shipped the correct goods in the correct quantity. They can also see if suppliers are delivering goods on time. Purchase orders can also serve as support in any legal disputes if they arise between you and the supplier.

Although you can write out purchase orders by hand, you would give a better impression if you used standard multi-part forms that you can purchase at any stationery store. They should include information such as the type of product or service you are ordering, the quantity desired, price and delivery terms. The orders should also have an area for any additional information. Purchase orders should also include your company name, address, telephone and fax numbers, and logo. You can simply write in this information, stamp this information on your purchase orders with a rubber stamp, or design and printyour own purchase order forms. Purchase orders should have at least three parts: a vendor copy, an internal file copy, and an accounting copy.

In addition to the standard purchase order, you might choose to use two other types: blanket purchase orders and annual contracts. If you routinely order fairly inexpensive items from a single vendor, you might want to place a blanket order for those items with the vendor. The blanket order covers specific items to be delivered over a specific period of time, such as six months or one year. This type of purchase order lets you take advantage of quantity discounts and saves you the time and trouble of reordering small items you need often. You will also receive a monthly invoice covering your purchases for a given month, instead of several small invoices covering each individual purchase.

Annual contracts cover the purchase of a specific product from a vendor over a period of 12 months. An annual contract will usually let you fix the price for buying a specific quantity of a given item over a year. You can also arrange to have goods delivered as needed, either monthly, weekly, or on another specific schedule.

Receiving Records

A packing list will accompany orders you receive. Make sure that the items shipped match the items indicated on the packing list. Inspect all of the items shipped carefully, paying special attention to items that appear damaged. Initial the packing list to verify receipt and file it in a folder until you receive the invoice for the shipment. In many cases, you won't have to send payment with your order; your suppliers will either include an invoice with the shipment or send the invoice to you separately soon after sending your order. When the invoice arrives, check it against the packing list and the purchase order. Write a check for the appropriate amount, note the check number on a copy of the invoice, and file the invoice and packing list.

If you receive any damaged items, or if a vendor sends you items you did not order, let the vendor know as soon as possible. The vendor will tell you the best way to return the items and to receive the ones you actually ordered.

Fill out an internal receiving report and distribute it to those who need to know when shipments come in, such as the person in charge of inventory control, the buyer, the employee requisitioning the items, and the person in charge of accounts payable in accounting.