Service Corps Of Retired Executives “Counselors to America’s Small Business” Since 1964...

Service Corps Of Retired Executives“Counselors to America’s Small Business”

Since 1964

WelcomeBudding Entrepreneurs

Thinking of Could I… Should I…Own a Business?

Be YourOwn Boss…Own A Business

WWW.SCORE.ORGCall 1-800/634-0245www.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027

Agenda

• Introductions

• What/Who Is SCORE

• Live Your Dream

• Business Basics

• Points to Ponder


National Organization US Small Business Administration 13,000 experienced volunteer professionals in 600 areas on

expertise in 400 chapters Eastern PA District - 500 volunteers in 16 chapters with 40 locations Annually extend more than 1.3 million hours of business advice,

mentoring and workshop sessions 31,000 new jobs (1 in every 7 clients) 68,500 new businesses Annual Business counseling, seminars & workshops

600,000 clients helped150,000 engaged in E-mail counseling 6,600 workshops & seminars held (190,000 in attendance)

9 million business owners helped - since 1964

SCORE


2010 Small Business Economic Impact

SCORE clients started a total of 58,637* new businesses in 2010

SCORE clients created 71,449 jobs at a cost of $98 per job

SCORE clients returned $548 to the federal treasury in taxes for every federal dollar appropriated to SCORE

SCORE clients saved 11,045 jobs

91% of SCORE’s “In Business” clients (those already in business in 2009) remained in business in 2010

* 2 or more employees


Who we are

Montgomery County Chapter

Jenkintown * Telford

Lansdale * Valley Forge

King of Prussia * Blue Bell

Counselors to

Americas Small Business

Since 1964

SCORE Business counselors are volunteers who have achieved business success and want to help you succeed in your business.

Dedicated volunteers Offer Confidential advice for your business Experienced business owners and executives

Experts who’ve seen both economic highs & lows

Pros with expertise in hundreds of disciplines

SCORE

www.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027

Our Mission…“is to offer our clients the

Professional Guidance and Mentorshipneeded to

Start, Enhance and MaximizeTheir Business Success

from the Idea to the IPO”

SCORE Membershipwww.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027

Live Your Dream | Grow Your Business

WWW.SCORE.ORGCall 1-800/634-0245

Montgomery County Chapter


SCORE

FREE and CONFIDENTIALCompanies in operation and Start-ups

Scheduled business counseling sessions at convenient locations:

Chapter Office: Jenkintown, PA Satellite Locations: Montgomery County Community College, Blue Bell PennSuburban (NorthPenn) Chamber of Commerce, Lansdale

Upper Merion Township Library, King of PrussiaSBA District Offices, Valley ForgeIndian Valley Chamber of Commerce, Telford


SCORE

Face-to-face, telephone, e-mail and “on-location” counseling of 40 our members

Advisory Board - like a board of directors

Business mentoring - from Idea to IPO

Matched Guidance: Specialized Professionals & Contacts- bank & insurance referrals, reviewing business & strategic plans, cash flow, & budget analysis, market research, taxes & business structure recommendations etc.

Marketing, Accounting & Finance, Real Estate, Insurance, Manufacturing, Advertising, Retail, Distribution, Technology, Mergers & Acquisitions, Franchising, eCommerce, Import & Export, Finance, Succession Planning, Legal

Conduct & Coordinate seminars & workshops

Chapter Business Services


Agenda

• Introductions


• Live Your Dream

• Business Basics



Q: Why is owning a business important to you?

A: Small business represents success

on your own terms.

• Be your own boss.• Bring a new idea to life.• Achieve your lifelong dream.• Create financial independence.• Turn your hobby into a profitable business.

Live Your Dream


Have You…– Wished you had a shoulder to lean on from someone who knows business from the inside out?

– Thought starting or expanding a business is overwhelming?

– Perceived business as a gamble?

Live Your Dream


Live Your Dream

SCORE Can Help You…


and take the mystery out of starting and expanding your own business


Q: How can a SCORE business counselor help?

A: SCORE counselors give real-world advice that applies to your business.

• Practical advice• Business planning assistance• Problem-solving for business challenges• Growth strategies for business opportunities• Confidential sounding board for your ideas


Live Your Dream


Live Your Dream


Here’s What to Expect

• a confidential counseling session with two (2) SCORE volunteer counselors who have the business experience you seek to address your questions (typically one (1) hour)

• an assignment to help you think you through your business challenge or opportunity

• a follow-up appointment to be set at your first counseling session

• follow-up from your SCORE counselor, checking in on your progress and offering additional assistance



• We begin with YOUR NEEDS.– Help you flesh out your ideas– Help you put together a realistic business

plan– Help you create marketing strategies– Help you manage cash flow.

We listen. We question. We advise.

Here’s What to Expect



“I want to buy a restaurant. How can I finance it?”

“What kinds of registrations will I need to go into business?”

“I’ve been an independent contractor for years. What are my personal risks, liabilities & benefits of incorporating?”

“Will the SBA lend me $250,000 to start my business?”

“My sales are declining. What can I do to get more customers?”

“My business is growing and now I need to hire someone to help. What do I have to do?”

“How do I market my business on the internet?”

Typical questions and issues



Ways of Ownership

– Buying an Existing Business

– Franchise Investment

– Start-up from Scratch



Buying Existing Business

• Advantages– QUICKEST

– LEAST RISK

– CUSTOMER BASE

• Disadvantages– INTEGRITY of

PURCHASE INFORMATION

– POTENTIAL for OVERPAYING

– LACK of CONTINUED SUPPORT from SELLER



Buying a Franchise

• Advantages– ESTABLISHED / PROVEN

TOTAL CONCEPT

– HIGH SUCCESS RATE

– LESS EXPERIENCE NECESSARY

– TRAINING & GUIDANCE PROVIDED

– ON-GOING SUPPORT (e.g.):• market research• advertising• new product development

• Disadvantages– HIGH INITIAL COST

(VARIES GREATLY)

– ON-GOING FEES & ROYALTIES

– LIMITED SCOPE / CREATIVITY



Start-Up from Scratch

• Advantages– BROAD OPTIONS

– FEW RESTRICTIONS

– GREATEST OPPORTUNITY FOR INNOVATIONS

– BEST OPPORTUNITY FOR MAKING MONEY

• Disadvantages– MOST EFFORT

REQUIRED BY FAR

– FINANCING USUALLY MORE DIFFICULT

– HIGHEST FAILURE RATE



Agenda

• Introductions


• Live Your Dream

• Business Basics



Business Planning 101

• Test Your Idea• Protect Your Idea

– Organization, Insurance, Regulations• Create a Business Plan

– Marketing/Selling– Financial Estimates

• Obtain Funding• Launch

SO…

• Thinking of Owning Your Own Business !?

“Points to Ponder”



SMALL BUSINESS FACTS

• More than 27.2 million small businesses in America.

• 640,000 new businesses annually• 99.7% of all employers are small businesses.

• Half the private workforce employed by small businesses.

• Small business is important to you and your communities.



Is Entrepreneurship For You?“SELF EVALUATION”

• Are you a self-starter and a leader?• How well do you get along with a variety of personalities?• How good are you at making decisions?• Do you have the stamina to run a business (commit long

hours)?• How well do you plan & organize?• Is your drive strong enough to maintain motivation -

patient but assertive?• How will the business affect your family – support and

encouragement?• Are you willing to take risks, able to learn from your mistakes &

accept all responsibility?• Are you innovative, resourceful & intuitive?



Owners Wear Many Hats. . .

• Leader• Plan• Make Decisions• Solve Problems• Marketing/Advertising• Understand Finances• Personnel


Do You Have theBelly to be an Entrepreneur?

• Passion• Energy• Drive• Leadership• Commitment



Think Through Your Business Model

• a well-thought-out concept or idea that will form the basis of the business

• a clear assessment of the size of the market for the product or service

• and a comprehensive study of existing or potential competitors

Consider three big basics:



IS THE REWARD WORTH THE RISK?

ASK ALL THE IMPORTANT QUESTIONS

1) HOW MUCH CAN I EARN WORKING FOR SOMEONE ELSE?

2) WILL MY BUSINESS PAY ME MORE?

3) IS THE DIFFERENCE ENOUGH TO JUSTIFY THE REWARD TO BE IN BUSINESS FOR MYSELF?



What Would You Do?FOR

YOURSELF

AN EMPLOYEE

BUSINESS REVENUE $75000 n/a

BUSINESS COSTS

(Expenses)

$40000 0

ANNUAL

SALARY / PROFIT

$35000 $30000

HOURS/WEEK 60 40

WEEKS/YEAR 52 50

HOURLY RATE $11/HOUR $15/HR(20% Pay Cut)(20% Pay Cut)



CRITICAL CRITICAL Planning QUESTIONS

• IS YOUR IDEA FEASIBLE AS A BUSINESS?• IS IDEA BASED ENTIRELY ON

PRODUCT/SERVICE?• WHO ARE YOUR CUSTOMERS -

WHAT ARE THEIR NEEDS?• WHO ARE YOUR COMPETITORS –

WHAT DO THEY OFFER?• HOW BIG IS YOUR MARKET?• CAN YOU FIND A NICHE FOR SUCCESS?



Build the Business Plan Three Major Questions

• What are the 3 to 5 things that are the Critical Success Factors ("Keys to Success") in your type of business?

• What are the major goals (objectives) you are going to achieve over the next 12 to 18 months?

• What are the strategies you are going to follow to achieve those goals?



Why Most Businesses FAIL

“THE 10 MOST COMMON MISTAKES”

• INADEQUATE EXPERIENCE, COMMITMENT, LEADERSHIP

• TOO LITTLE CAPITAL EXPENSE CONTROL• FAILURE TO TEST CONCEPT - “No Market”• UNDERESTIMATING TIME TO BUILD MARKET• UNDERESTIMATING THE COMPETITION• NOT EXPECTING THE UNEXPECTED PLANNING• UNDERPRICING, EXTENDING CREDIT TOO FREELY• POOR RECORD KEEPING ORGANIZATION• NARROW TARGET MARKET, POOR LOCATION• EXPANDING TOO RAPIDLY- EQUIPMENT, INVENTORY• IGNORING THE INTERNET & BRANDING



Seven Perils of Business Ownership

• 1. Time Mismanagement• 2. Organizational Skills • 3. Focus (or rather “Lack of”) • 4. Fear of Failure• 5. Lack of Marketing• 6. Not Staying on Top of Your Game• 7. Forgetting to Have Fun



Business Ownership

also means RISKS. . .

• 10% truly successful

• 40% operate marginally

• 50% fail

• 25% fail during the first year!!!


On the Upside

• You get to be your own boss; to work at your time and pace

• All “Your Efforts Benefit You” rather than someone else

• Earnings Growth is limited ONLY by Your Desire and Ingenuity

• Running a business provides endless variety, challenge and opportunities to … “Learn” while “You Earn”


FactorsFactorsThat Contribute To SuccessA Focused Business Plan (road map)Hard Work (all areas)

Make a Total CommitmentPrepare MentallySell Yourself

Quality Products and ServicesDedication To Customer Service

Be Single-Minded in Seeking CustomersSEEK GOOD ADVICE


Business OwnershipBusiness Ownership

Provides REWARDS. . .

– Substantial Income

– Financial Security

– Independence

– Recognition

– Satisfaction


Six Steps to Get “Slightly Famous”

• Targeting the Best ProspectsSpeaking EngagementsConferences

• Developing Unique Market Niche

• Positioning Your Business as Best SolutionProvide training

• Maintaining Your VisibilityContinuous messageNews release, press (your

solutions current situation)

• Enhancing Your CredibilityIndustry expert

• Establishing Your Brand & Reputation– Branding & Brand identity – Strike emotional chord -

“bring “soul” in Marketing– Personalize the business


What’s Hot

• Latest Business Trends– Luxury Items– Home Improvement– Business geared towards

Children– Security (business & personal)

• Hot Markets– Middle Aged Women

• Making more money• Family Decisions & Shopping

– Single Markets• 40% adult population

– Sleep Deprived– Food– Overweight

• Hot Businesses– Health Care Technology– Investment / Financial– Online Learning– Online Gaming– Pet Accessories– “Bankruptcy Doctors”

• Saving companies– Medi-spas

www.score513.orgwww.score513.orgwww.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027


Failure to have a formal business plan

Start a business with partners and associates with no formal written business agreements

Insufficient financial support

Failure to consider competition

Too much reliance on do-it-yourself legal, accounting and marketing.


Business Start up

Mistakes to Avoid


No Experience

False illusions as to effort required

Wrong location

Start a business where there is little demand

A dislike of Marketing/Sales


Business Start up

Mistakes to Avoid (cont.)


Remember…

There is only a limited amount of money There is only a limited amount of money available for business transactions.available for business transactions.

So… for you to earn some of it, you will So… for you to earn some of it, you will have to take it away from someone have to take it away from someone else.else.

That “someone else” is your competitor.



The Bottom LineThe Bottom Line

• “Failing to Plan isPlanning to Fail”

Never, never…Never, never…ForgetForget

The CompetitionThe Competitionwww.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027

ScoreMake

Your First Source of BUSINESS ADVICE And… Your BestBusiness Decision

“There’s No Business Like Your Business”



Thank you for listening

www.score513.orgwww.score513.orgCall 215 885 3027Call 215 885 3027 Any Questions?Any Questions?

Service Corps Of Retired Executives “Counselors to America’s Small Business” Since 1964...

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