Best Books for Small Business Owners – Multipliers

While it’s essential to business and career success, continuous learning is easier said than done, especially for small business owners who wear many hats. That’s why we’ve created the Monthly Must-Reads series with our selection of best books for small business owners. We not only share the best books for small business owners, but also aim to save you time by helping you quickly determine whether each business book is worth your valuable time.

Keep up with current innovation, management and workforce trends by reading the right business books for tu situation. With each featured book, we share the main focus, key take-aways, and even reader reviews. For December’s best books for small business owners, we’re sharing Multipliers by Liz Wiseman. For a list of past Monthly Must-Reads, like October’s Influence: The Psychology of Persuasion, check out the bottom of this article.

Business Book:

Multipliers, by Liz Wiseman


It helps you understand how to bring out the best possible performance in your employees.

Main Idea:

There are two types of leaders: Diminishers and Multipliers. Multipliers inspire their employees to willingly reach for and achieve outcomes that they may never have thought possible.

Great for Small Business Owners Who:

Want to get exciting results from lean teams with few resources.


Wiseman presents real-life anecdotes that illustrate two distinct leadership styles by analyzing data from more than 150 leaders: Diminishers and Multipliers. She then identifies each one’s habits of thought. She explains that Multipliers enjoy a higher rate of success and more impressive results by making everyone around them more productive, engaged and creative.

Wiseman empowers her readers to learn how to lead like Multipliers by contrasting Multipliers and Diminishers in the following ways:

  • Talent Magnets vs. Empire Builders
  • Liberators vs. Tyrants
  • Challengers vs. Know-It-Alls
  • Debate Makers vs. Decision Makers
  • Investors vs. Micromanagers

After digesting this guidance toward becoming a Multiplier, readers are invited to take a self-assessment via Wiseman’s website to identify where they lie on the scale from Diminisher to Multiplier.

Key Take-Aways:

  • Multipliers create more intelligence around them while diminishers’ leadership habits often stifle their team’s creativity and problem-solving skills.
  • Multipliers:
    • Attract talented people because they become known for empowering team members and using them at their highest potential
    • Foster safe places for people to share, collaborate and unlock their best ideas
    • Outline challenging opportunities that inspire their people to stretch themselves
    • After you hear all points of view, make decisions based on stimulating, healthy debates.
    • Invest in their people, empowering them to take ownership of their roles and outcomes

Reviewers Say:

“Seeing as I’ve read [Multipliers] three times, I can’t believe I haven’t written a review yet. No exaggeration, this book can be a life-changer both at work and in your personal life. I admit that the first time I read it I thought, ‘Ok, this is so clear as to be obvious; I’ve seen these types of people for years at work.’ But, so what? I never thought it through, and Liz [Wiseman] has done the research, so my anecdotal evidence is supplanted by the real thing. Chapter by chapter, the concepts were illuminated with great examples and stories. This is no flavor of the month. These are concepts that can be used easily at work. And if applied, they work. I can attest to that.”

“We’ve all heard—and said—that less is more. Sometimes it’s true. But in most cases it’s still the reality that more is more, and is usually the preferred ROI of resources, whether those resources are of time, money, manpower, brain-trust, whatever. Best of all is getting more from less, and that is what Liz Wiseman’s fine book teaches us to do. Using a wide-range of varying case studies and examples from the world over, Wiseman itemizes the symptoms of a variety of leadership illnesses that sicken a corporate culture and disable its employees. You may well find yourself hiding in these pages somewhere; I know I did. Fortunately, after helping us see where we are minimizing rather than maximizing the human resources at our disposal, Wiseman clearly articulates the prescription(s) to fix the problem(s). It has the added advantage of being an engaging, thoughtful and well-written treatment.”

Monthly Must-Read Business Books:

August – Blitzscaling

September – The E-Myth Revisited

October – Influence: This Psychology of Persuasion

November – Built to Last

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Signs that Business Expansion is on the Horizon

When it comes to business expansion, business owners face a daunting challenge. Is now the right time to expand your enterprise? If not now, when? What type of expansion makes the most sense–new customer acquisition, upgrading or launching a new product line or opening a second retail location? The choices may feel overwhelming at first. But it doesn’t have to be – if you watch for signs that expansion really is the wisest move in the months ahead.

Como Forbes notes, while “no single factor can dictate success or failure in business expansion,” intuition plays a key role, “knowing precisely which signs to focus on and follow in planning your business’s growth.” Here are widely acknowledged key factors that indicate successful business expansion could be on the horizon.

High demand

An increased demand for your products or services indicates the need for a new growth strategy. (Of course, by “need,” we mean an ongoing demand from customers, not a one-time or seasonal spike in sales.) A new, more effective marketing strategy could generate such demand. As is often the case, an increased cadre of repeat customers know what you have and want more of it.

Favorable trends

It’s not enough to focus only on what’s happening within your own organization. Successful business owners closely monitor industry-related forecasts and trends in order to gauge potential challenges and opportunities that might lie ahead. In fact, the more often you engage in this market analysis, the more knowledgeable you become at detecting small or significant shifts within the industry that can favorably impact your business.

Keep an eye on the big picture. Watch for signs of slowdown in the national economy or, conversely, indicators that consumption might soon be on the rise. Armed with this information, you can embark on a growth plan based on a solid foundation.

Healthy cash flow

As every business owner knows, cash flow is the lifeblood of any enterprise. While entrepreneurs may struggle at first to master this key element, businesses that enjoy success in the marketplace often find themselves with sufficient funds to explore new avenues of growth.

So while “cash can be consumed by any number of incremental expenses,” notes Inc., when you’re “confident that you can cover additional outlays and can weather any number of storms … then your prospects for growth look awfully good.”

Strong workforce

Business owners continuously grapple with the challenge of recruiting and retaining quality talent. But if you’re fortunate enough to have a strong workforce in place, the moment could be right for expansion.

Take time to identify your current top performers. Look for ways to encourage their development. Maybe add training and development sessions. Through more access to technology and other resources, your employees will become more effective in their jobs.

Clearly communicate your company’s mission and objectives. This way, each of your skilled employees will understand where they fit in the bigger picture.

Hungry for a Challenge

When you first start out, emuy aspect of the business represents a challenge. The owner of a successful business might feel like they need a new challenge. What was once exciting has become a daily grind. If you “are actually bored, your business has probably reached a plateau and it is time for you to grow it,” says the UPS Store.

As noted, successful business expansion relies upon a number of factors. But if your business is presently doing well–and all indications show that consumer demand will remain consistently high–don’t put off making plans for growth. No business can afford to “run in place.” Opportunities for expansion don’t come along every day, so it’s critical to recognize positive signs and take action as soon as possible. A bright future lies ahead!

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Business Loans for Contractors: The Best Choices

Contractors need different types of capital to run their businesses. They use long-term capital to finance equipment purchases and short-term capital to smooth out temporary fluctuations in cash flow. Here are the best loans for contractors with descriptions of their collateral requirements, application procedures and repayment terms.

Línea de crédito

A business line of credit is a valuable and flexible source of funds for a contractor. It allows you to make “draws” as needed against the maximum approved line of credit. You will only pay interest on the amount of loan drawn down. If you repay the loan, you can come back later and borrow again. These types of loans are known as “revolving” lines of credit.

Lines of credit help smooth out short-term fluctuations in cash flow. They can be used to meet payroll expenses, pay suppliers and provide cash during slow periods. They can be drawn down at any time.

Lines of credit are usually secured by the contractor’s assets, such as accounts receivable, inventory and equipment. The amount of the loan is based on the lender’s appraisal of the worth of the company’s assets and its financial leverage. For example, a lender might advance 80% of the value of accounts receivable but only advance 50% of the book value of inventory and equipment. The maximum line of credit would be the sum of these appraisals.

The application and approval process for a line of credit is usually very quick.

Equipment Loans

From vehicles to high-priced heavy equipment, contractors need all types of equipment to perform their work. Equipment purchases for large amounts should align with the useful life of the asset. Equipment purchase loans are payable over several years, usually up to five years with monthly payments.

Lenders will require down payments of 10% to 20% but will finance the rest of the purchase price. This enables contractors to buy big-ticket items that may have otherwise been out of reach.

The collateral for an equipment loan is typically the equipment itself. This leaves the contractor’s other assets, such as receivables and inventory, available for collateral for other loans.

Small Business Administration Loan

Because of their long repayment terms and low interest rates, SBA loans are highly desirable. Lenders guarantee up to 85% of loans to contractors. This way, they have solid security in case the borrower defaults.

To finance long-term working capital needs and businesses with seasonal fluctuations, you can use funds from an SBA loan.

The hard part is that SBA loans are difficult to get. Only the most creditworthy applicants receive approval. Borrowers must have several years in business with good revenues and a strong credit history.

SBA loan applications require a considerable amount of paperwork and can take several months to get approved. SBA loans are highly desirable if you have the credentials and time to wait.

Accounts Receivable Financing

Under an accounts receivable financing agreement, the lender agrees to make advances up to a certain percentage, say 80%, of the contractor’s total accounts receivable outstanding. Repayment terms are either weekly or monthly. The contractor retains ownership of the receivables and assumes the risk of non-payment from the customer.

To make up short-term deficits in cash flow as needed, use funds from an accounts receivable agreement.

Invoice Financing

Invoice financing, also known as factoring, lets a contractor receive an advance against the company’s receivables. The factor typically will make an advance to the contractor of up to 80% of the invoice amount and collect the balance from the client at due date. Funds from factored invoices normally go into the contractor’s bank account the next business day.

In a factoring agreement, the lender, known as the “Factor”, purchases invoices from the contractor. They assume the responsibility of collecting the debt. Factoring fees can range from 2% to 4% of invoice value.

Approval for this type of invoice financing is based more on the creditworthiness of the contractor’s customers than the credit rating of the contractors themselves.

Loans for contractors range from lines of credit and receivables financing to meet short-term cash needs to equipment loans and SBA loans for long-term purposes.

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Overcoming Claim Rejections and Insurance Denials

Are your staff’s efforts overcoming claim rejections costing your practice money?

According to a recent study by the Medical Group Management Association (MGMA), reworking a rejection or denial claim averages a cost of $25. When you multiply that $25 by multiple claims every year and figure in another startling fact—that 50 to 65 percent of rejected claims are never reworked—there’s a significant possibility that your billing practices are leaving money on the table.

The good news is: strategies for overcoming claim rejections and insurance denials are readily available. With the help of two experts in the medical billing and practice revenue fields, you’ll learn why insurance company deny or reject claims. You’ll also learn about steps you can take to help increase your clean claims ratio.

You’ll be on your way to an improved revenue stream and more efficient billing practices in no time.

Common reasons for claim rejection and denial

Needing to overcome claim rejections and insurance denials often begins at a practice’s administrative level. Errors in submission, coding, and verification lead to many avoidable claim challenges.

To get to the root of why insurance companies typically reject and deny claims, our two experts weigh in below. Madeline Silva, CEO of Freedom Switch, a firm specializing in strategies that help physicians improve their collection rates; and Nancy Rowe, CEO of Practice Provider, a revenue cycle management, consulting and software development company for the medical industry both share their perspectives from over 20 years in their fields.

Top reasons for claim rejections:

1. Submission errors

“One-third of all claims are not received by the insurance companies,” says Silva. Even if a practice has an electronic record for a claim submission, the carrier’s system loses many claims. “If you’re not consistently following-up on claims, you’ll never get paid on these claims.”

2. Invalid Medicare numbers

“Medicare recently moved away from using patient social security numbers and instead chose to use 11 randomly chosen alphanumeric characters which are often entered incorrectly,” says Rowe.

3. Coding errors

If your practice performs procedures that aren’t approved for a specific diagnosis, Silva says your practice could have the claim rejected. As well, many claim rejections come down to a missing modifier on a procedure code—an easily avoidable mistake.

4. Termination of coverage

“This most often occurs at the beginning of the year when patients opt-out of their current plan and enroll in another,” says Rowe.

5. Smart edits

“The carrier will automatically reject claims that contain certain procedures (CPT codes) combinations or procedure/diagnosis (ICD 10 code) combinations,” Rowe says.

Top reasons for insurance denials:

1. Inexperienced billers

Being a certified coder or biller is a start, but Silva says that training still leaves room for errors. “The real experience comes from doing the work day-out-and-day-in,” she says.

2. Authorization

“The most common denial I see in practices is for failing to obtain authorization [for a procedure] from an insurance carrier,” says Rowe. Staff members handling claims submissions are often not adequately trained and up-to-date on carrier requirements.

3. Lack of follow-up

“Follow-up on past due claims is essential for getting paid on those claims and learning what you need to do to reduce denials,” says Silva.

4. Medical necessity

Rowe often sees practices with denied claims for in-office procedures such as echocardiograms, ultrasounds, and minor surgical procedures. As each insurance carrier has written guidelines for which procedures are allowed for a specific diagnosis, practices that don’t follow those guidelines can find themselves stuck for payment.

5. Lack of in-practice checks and balances

Silva says that many practices lack a system of internal accountability which ensures that in-house and outsourced teams are proactively approaching billing challenges.

And, If your practice is in a cash crunch because you’re waiting for payment on claims, you could be putting the longevity of your practice at risk.

“Smaller independent practices have a higher percentage of overhead as compared to revenue,” says Rowe. “This makes it difficult to sustain themselves if faced with having to wait several additional weeks to be paid while claims are resubmitted and appealed.”

According to Silva, $120 billion in insurance claims goes uncollected every year. Odds are, your practice has a rightful claim to many of those dollars.

Now that you know the most common reasons for claim rejections and denials, you need to be proactive in the steps you take to help overcome claim rejections. It’s high time you enjoyed a practice with a higher clean claim ratio.

Actionable strategies for overcoming claim rejections

The bottom line is: doctors don’t want to handle billing for their practice themselves. However, that doesn’t mean that a practice should silo billing without physician involvement.

The most beneficial steps that a practice can take toward overcoming claim rejections and increasing its clean claims rate are those that integrate multiple areas of the practice.

Here are the areas in your practice where you can take immediate action to improve your billing practices and decrease the likelihood of claim rejections for the long haul:

Obtain prior authorizations

“A properly trained staff person who is responsible for obtaining authorizations will be familiar with the requirements of each insurance plan and be kept updated when a carrier changes their authorization requirements,” Rowe says. “Having software designed to initiate and track authorizations is key to reducing these types of denials.”

Hire a dedicated billing team

“Having a team member who runs your front desk do your billing on the side is a really bad idea. You need a dedicated billing team experienced with your specialty, ” says Silva.

Essentially, your billing team controls how fast money flows into your practice. You deserve to have a team dedicated to tracking claims and payments full-time.

Train your front desk staff

“Front desk staff need to be very diligent in asking for updated insurance information and should also use the eligibility functionality within their PM/EMR software to verify eligibility at the time appointments are made to avoid these rejections,” says Rowe. As your front desk staff is your first line of defense, make sure they have the tools and education to set your billing team up for success.

Focus 60 percent of efforts on follow-up

“If your team is not spending the majority of their efforts on the follow-up – they’re either not billing for all of the services provided, writing off balances as uncollectable instead of following-up, or simply letting your accounts receivables climb without care – all of it will lose you money,” Silva says.

Invest in technology

“Purchase a card scanner with OCR capabilities to automatically capture patient ID numbers. [This] helps avoid data entry-related claim rejections,” Rowe says.

Reject smart edits

“I advise practices to reference the list of smart edits and build coding rules in their practice management software to proactively avoid specific coding combinations,” says Rowe.

Request reports

“The right billing cycle reports will give you predictable collections month-after-month,” says Silva. “This is how you track your billing team without micromanaging.” Rowe also advocates for regular reporting. “The best way for practices to see where their revenue shortfalls or delays are is to regularly look at their outstanding claims reports by carrier,” she says. “It will be easy to see denial trends and quickly react to them.”

Set regular review meetings

“Set times to review your reports with your billing team,” Silva says. “Ask questions, delegate projects, and hunt down payments for every claim billed. Showing that you care will make your team care.”


“Carriers are constantly updating their policies regarding authorization requirements and medical necessity. Appoint someone in the practice to read quarterly carrier update documents and troll websites for new information,” says Rowe. “Local coding chapters are also great resources for those working in smaller practices.”

Now you have the tools to start conversations with key members of your practice about strategies for decreasing claim rejections and insurance denials. Knowing where your practice falls short will help you establish a plan for actionable change. From there, you can build a strategy that’s equal parts education, accountability, and tenacity.

Your days of increased revenue and more clean claims are on the horizon.

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Best Books for Small Business Owners – Built to Last

November Monthly Must-Reads: Best Books for Small Business Owners

Life-long learning is an essential ingredient to business and career success. However, it’s easier said than done – especially for business owners with a lot on their plate. If you own and/or run a business, you may find it difficult to make time for your own learning and professional development. So, we’re here with a strategy that you can fold into your everyday life: Reading the best books for small business owners. Keep up with current innovation, management and workforce trends by reading the right business books for tu situation.

Save time by staying tuned to our Monthly Must-Reads series in which we cover well-known and new business books. For each featured book, we share its main focus and key take-aways, allowing you to determine within a minute whether it’s worth your valuable time. This month, we’re sharing Built to Last by Jim Collins and Jerry Porras. For a list of past Monthly Must-Reads, see the bottom of this blog post.

Business Book:

Built to Last, by Jim Collins and Jerry Porras


What goes into building a successful company that lasts for generations to come

Main Idea:

Visionary companies that achieved long-term success did so by identifying and staying true their purpose.

“Managers at visionary companies simply do not accept the proposition that they must choose between short-term performance or long-term success. They build first and foremost for the long term while simultaneously holding themselves to highly demanding short-term standards.” – Built to Last

Great for Small Business Owners Who:

Want to take a long-term view of success and build a strong company culture.


Building upon their six-year research project at Stanford University Graduate School of Business, Collins and Porras surveyed hundreds of CEOs at leading corporations. They used these responses along with industry research to identify 18 leading organizations that they call “visionary companies.” These visionary companies have not only stood the test of time, but many have also outpaced their competitors, even ones that had formerly been industry leaders.

So, what did they have in common that helped them rise above their rivals? Collins and Porras compare these companies to their peers throughout various stages of their lifecycles. In Built to Last, the authors lay out their discovery: The practical principles—with examples—behind how visionary companies set themselves apart.

Key Take-Aways:

  • Visionary companies identify their purpose and live for it. A purpose is a meaningful reason for a company to exist. In a truly visionary company, every decision meets and must support the organization’s guiding purpose.
  • Purpose takes precedence – especially over short-term profits. The leaders of time-tested visionary companies put their purpose first every time in order to support their long-term mission.

Reviewers Say:

“As a well-researched book might indicate, the authors provide a tremendous amount of detail on what makes companies such as Coca-Cola, Citi Bank, Wal-Mart, Walt Disney, Nordstrom, stand the test of time. These companies have been active in our lives for generations, and they reveal exactly how they have endured, and how they will continue to endure for many generations to come. Whether you are an entrepreneur, owner, middle manager or a salesman, this book will undoubtedly inspire you to reach great heights.”

“Thoroughly researched and filled with great points. … after the first few chapters, it becomes incredibly redundant. I could only read about Ford and 3M’s same success stories so many times before I became saturated with it and couldn’t take another dose. For the last few chapters, I read the first few pages and then went to the chapter’s ‘Take Away’ section and still got everything I wanted out of the book.”

Check out some of our other Monthly Must-Reads Business Books:

August – Blitzscaling

September – The E-Myth Revisited

October – Influence: The Psychology of Persuasion

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Decrease Medical Practice Overhead In These 7 Areas

As an independent practitioner, you focus on providing high quality healthcare to your patients. But, you’re also a business owner with a wide range of expenses. All business owners want to reduce costs, but as a medical professional you want to be sure that your service doesn’t suffer in the process. The average medical practice has overhead between 60% and 70% of its revenue. This includes everything from staff salary and benefits to medical supplies, insurance premiums, rent, technology and more. To decrease medical practice overhead, focus on items that won’t negatively impact your patient or employee experience. Here are seven areas to consider when you want to decrease medical practice overhead.

1. Insurance

One of your largest annual expenditures is likely your malpractice insurance. Depending on your practice type and state, premiums start at about $4,000 a year and can go up to the tens of thousands. The typical practitioner pays about $10,000. To avoid overpaying, make a habit of reviewing your policy and getting new quotes each year. Make sure you’re also taking advantage of available discounts. You may qualify for a lower rate by being a member of an association or for taking a course on reducing your malpractice risk that some insurers offer.

2. Office Lease

Another way to cut costs is to review your office lease and compare it to available properties. If you’re not using your entire space, consider a smaller space or subleasing an office to another provider. Or, use the information you’ve gathered on market rates to negotiate with your landlord. While moving your practice could be inconvenient, it might save you money in the long run.

3. Supplies

Take inventory of your supplies on a regular basis as to not order too much. If you have a contract with a supply vendor, review the terms and renegotiate where possible. And, check prices with competitors with a quick internet search. You may be able to save money by ordering supplies in bulk. If this is the case, make sure you’re only doing this for the things you use most frequently. Also, take advantage of sales. Contact your rep to ask about deals they’re offering this month. Check if you can combine vendors and qualify for a volume discount. You may be surprised at the number of overlapping products your vendors offer, allowing you to streamline your ordering and decrease medical practice overhead.

4. Outside Services

Review the outside services you use each year, like your patient linens supplier or document shredding. You may find providers that are less expensive or that offer multiple services so you can combine and save. Or you may be able to team up with other healthcare providers in your building and request a discount if you agree to use the same service on the same delivery schedule.

5. Paper Usage

Find ways to cut back on your paper usage. In place of paper, a growing online program is HIPAA-compliant digital tools. For example, you could send new patients links to forms that they can download and fill out at home before coming to your office. You can also look into services that allow your patients to complete and securely submit forms online. An added benefit of using online forms is that it speeds up your check-in process. This can improve patient waiting times.

6. Billing

Sending paper bills can be costly. You run the risk that patient payments are delinquent or overlooked and must go into collections. Instead, start asking all patients to keep a credit or debit card on file. This step eliminates the patients’ need to mail in payment and helps you keep costs down by reducing your own billing charges. If a patient doesn’t want to provide a card, require prepayment.

7. Utilities

Finally, watch your utility bills and take steps to reduce them. For example, you can turn off all devices at the end of the day. Take it a step further by unplugging electronics or using power strips that can be turned off at the end of the day. Computers, scanners, copiers, medical devices and other electronic equipment use electricity even when they’re sitting idle or turned off. Also consider the kind of equipment you’re using. Switching from desktop to laptop computers can save 80-90% in electric usage. Whether you lease or purchase equipment, be sure to choose ENERGY STAR devices that automatically power down when inactive. This can help you save as much as 50% on your energy bill.

The Bottom Line

Reducing your costs can free up money to use in other ways. You can possibly provide your staff with higher salaries or more benefits, or invest in new equipment to expand the services you offer. Be sure to share your goals and ideas to decrease medical practice overhead with your staff. Your team probably knows what can be eliminated. Asking for employee input gives your staff ownership over the outcome and increases the chance of implementing these suggestions. And remember, minimizing costs requires everyone’s cooperation.

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How to Negotiate a Commercial Lease to Help Your Business Prosper

A key factor in the success of your business is how effectively you negotiate a commercial lease. This impacts your cash outlays over several years, your operational efficiency and, depending upon your type of enterprise, your revenue as well. Thererfore, it’s essential to take a comprehensive and methodical approach before signing a lease agreement.

Here’s how the way you negotiate a commercial lease impacts you in those three areas:

  • Cash outlays: It’s not just the rent payment itself. It’s also the financial obligations you might also incur through the lease agreement, depending upon the lease type.
  • Operational efficiency: If you quickly outgrow the space you rent and can’t do anything about it, your operations can become bogged down due to overcrowding, or the inability to add more staff or equipment to meet the increased demand for your products or services.
  • Revenue: You might depend upon the convenience or visibility of your location to keep customers and draw in new ones. So, remember the old adage about the three most important criteria in real estate—location, location, location.

With those considerations and your business plan for the next few years, you can determine how much you can actually afford. Without some kind of multi-year rent budget in mind, you can’t make many other decisions. You don’t want to waste your time looking at places you can’t afford. And, you certainly don’t want to settle for barely adequate space without realizing you can afford more.

Assess Your Needs

Before you enter lease negotiations, make sure you take into account all the important considerations about the physical space itself. The hardest part involves making predictions. Consider, for example, local growth patterns in the community and any known big development projects (including infrastructure) in the works. Is the property you’re considering likely to be a more or less desirable location a few years from now?

Also, think about the tax and regulatory environment. Can you anticipate any changes that might make that jurisdiction become a more costly place to do business?

Once the location you like cleared that initial test, it’s time to focus on lease terms. Before you obtain a filled-in lease, it could be beneficial to ask the landlord for a blank one. That makes it easier to focus on all the variables and fine print you might overlook while going over the numbers.

What’s Covered in the Lease

Property-related costs addressed in the contract are the most basic thing to understand about a lease. For example, with a “triple net lease” – in addition to paying for the space itself – you’re responsible for the utilities, real estate taxes, insurance, routine upkeep and simple repairs. You’re on your own for everything except for major structural repairs (i.e. a collapsed roof).

With a “double net lease”, you pay for all of those items except maintenance and repairs. With a “single net lease”, you pay only for utilities and property tax. You might also find another kind of lease with a different cost-allocation formula.

None of these lease types is necessarily good or bad. When you negotiate a commercial lease, the more cost elements covered in the contract, the more exposed you are to cost increases – whether it’s in taxes, insurance or utilities. You can try to reduce that risk by negotiating limits on how much of a cost increase you’ll be obligated to absorb over the lease term. The more risk you take with these, the better the deal you’ll need to negotiate on the base rent.

Equally, or perhaps more importantly, is the length of the lease. How long are you willing to commit to staying at that location? Even if your lease allows you to sublet the property to someone else, you’re still on the hook for the rent. You’d assume the risk that whoever you sublet to will default.

Long Lease or Short?

Landlords generally prefer longer leases. It allows them to lock in a constant income for more time without trying to find a new tenant. Contrarily, the landlord might be willing to give you a better deal on the initial base rent. But, they might insist on having you responsible for the items you get in a triple net lease.

Still, what you want in regards to the length of the lease depends on the commercial real estate market environment. In a hot market, a landlord could push for a shorter term to raise the rent substantially.

Ten Lease Negotiation Tips

Here are ten more items to keep in mind when it’s time to negotiate a commercial lease:

Useable space

The number relates to space you can actually use when rent is by a per-square-foot basis. Things like elevator shafts, emergency stairwells and structural columns take up useable space. Measure the useable space and compare it to the number advertised. Minor discrepancies might be acceptable, but not big ones.

Sublease clauses

Insist upon finding another tenant to replace you to finish out the lease term if you need to move early.

Termination penalties

Perhaps you’ll want to break the lease without finding a tenant to complete the lease term. Try to keep the penalty reasonable.

Protection from competitors

If the landlord owns additional space nearby, include a provision that prevents the landlord from renting such space to a direct competitor.

Co-tenancy clause

This is the opposite of protection from competitors. If you chose to lease space adjacent to a “big box” store or a similar “anchor” tenant and you expect to draw foot traffic to your location, and that tenant leaves, you could suffer greatly. A co-tenancy clause allows you to break your lease in such a scenario.

Reasonable “cure” period

A “cure” period is the amount of time you’re given to catch up on rent if you’re behind – before incurring massive penalties or losing the lease entirely.

Certificate of occupancy

When space is used for something other than that for which the original building permit was issued, the landlord needs to obtain this document from local government. If you can’t move in until that document is obtained, protect yourself from paying rent during the time the landlord is waiting to get that certificate.

“Fixturization” period

Try to avoid paying rent during the time it takes you to modify the property so that it meets the needs of your business.

Utility costs

In the likely event that you pay the electricity, water, waste disposal and other utility bills, find out what you’re getting into. Ask to see a year’s worth of those bills from the prior tenant.

Parking rights

Does the landlord own or have access to a parking lot? If so, make sure you have enough spaces for employees y customers.


Finally, there are factors that can’t be pinpointed when you negotiate a commercial lease – whether it’s the responsiveness of the landlord when problems arise or possible issues involving neighboring tenants and their customers. For insights on those, you’ll need to do some research by talking to other tenants and spending time in the area observing its goings on.

When it comes to haggling over specific lease terms, you can get ahead by engaging a real estate attorney familiar with not only lease contract provisions, but local market conditions as well. That way, you reduce your chances of paying more than you have to. But as in any negotiation, expect to make some compromises to ensure not only that you end with an agreement, but set the tone for a positive long-term relationship with the landlord.

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How to Construct a Business Action Plan to Get Things Done

You’ve probably heard about the importance of creating a business plan to plot the growth and development of your business. So you outline your goals to increase sales, reduce costs and improve profits. But then what happens?  Setting goals is fine, but they need something that brings them to life. Something that makes everything happen. That something is a business action plan.

Here’s how to construct an action plan for your business that brings your goals to life.

What is a Business Action Plan?

While a strategic business plan outlines the overall growth, direction and development of the company, an action plan converts those objectives to identifiable tasks.

Quite simply, an action plan is a carefully thought-out listing of all the things that have to be done to turn your goals into reality. Let’s take an example.

Suppose one of your goals is to increase sales by 10% by hiring an additional salesperson to make more outside calls to potential new customers. The steps to achieve this objective might be as follows:

  • Write up a job description
  • Post your the postion on jobboards
  • Review the resumes that you receive and select 10 candidates to interview.
  • Schedule in-office interviews over the next three weeks.
  • Take one week to go over interviews to choose a candidate and make a job offer.

Each objective in your strategic plan needs a detailed list, like the one above, of the tasks needed to accomplish the goal.

What are the Components of Action Tasks?

Effective action-oriented tasks follow the SMART outline. They are:

Specific – Setting a goal to increase sales is too general. But saying you want to increase sales by 10% is specific. This way, you take last year’s figure, suppose it was $850,000, add 10% or $85,000 and you have a new specific target of $935,000.

Measurable – Progress towards achieving a goal must be measurable. Weekly sales reports, for example, will track the movement along the path to a revenue goal.

Attainable- Employees must genuinely believe that it is possible for them to reach the objectives. If they don’t feel the objective is realistic and reasonable, they won’t even try.

Relevant – Goals must conform to the company’s business model and customer demographics. The goal should be worthwhile, match other company efforts and applicable in the current economic conditions.

Timely – Set a target date. Establish a deadline to keep the focus on tasks leading to long-term goals.

Which Resources are Needed?

Identify the resources needed to carry out each action task. How much will it cost? How many people will be needed? Will you need to purchase any additional physical assets?

In our example, someone has to write the job description, place the ad and make sure the ad is paid for. How many hours of an employee’s time will this take, and how much will the ad cost?

Communicate the Plan to Your Employees

Get your employees involved. Let them know what your plans are and explain how these actions fit into the company’s business strategy.

Ask for their input and solicit suggestions. Employees are much more likely to support your plan and participate in its implementation if they are part of its creation.

Designate a person to be in charge of each task. Someone has to accept responsibility for the execution of the assignment.

Set Timelines for Each Task

Each task must have a specific time to complete and a deadline. Without timelines, work will expand to fit the time allowed.

Monitor the Progress

Create procedures to receive regular progress reports for each action task. The responsible employees must be aware that they will be monitored, weekly if necessary, to make sure things are moving along. If obstacles appear or deviations from the expected timelines occur, adjustments can be made to get back on track.

Business action plans are the means to convert strategic ideas into reality. Tasks that are created with action plans using the SMART method with employe participation will have the highest likelihood of success.

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Is your workplace safety plan up to snuff?

Maintaining a clean workplace safety record in your business is no accident. It takes both clear safety procedures and planned remediation strategies for destructive events beyond your control. Even if nothing bad happens, employees will know you care about their welfare.  And you can enjoy some peace of mind. But where do you start?

Workplace safety begins with an inventory of the hazards your business faces – starting with risks for injuries to employees – to build a plan around. Physical hazards for manufacturing operations or others involving the use of machinery and power tools are straightforward. If you have such a business, chances are you’re already familiar with federal Occupational Safety and Health Administration (OSHA) rules specific to your business that address particular hazards.

But every business can be the scene of a workplace injury or medical crisis, including ones involving your customers. It could be a slip-and-fall, or a sudden health emergency such as a heart attack or stroke. And then there are the risks of a fire, gas leak, electrical shock, and so on.

Plan to Save Lives

You’ve also got weather-related events to consider. Do you operate in a hurricane, flood, tornado or earthquake zone? Keep them in mind. How about an extended power outage? And while the odds are surely extremely thin, you can’t ignore the possibility of an active shooter on your premises. Planning for that could save lives.

The mission of the Federal Emergency Management Agency (FEMA) is to prepare the public for nearly every kind of physical calamity, from active shooters to wildfires. This page on its website catalogs some 30 hazards (not limited to worksites) and offers response plans for each.

Much thinking about such contingencies, and how to make a plan to deal with them, has also already been done for you by OSHA. And be aware that making a contingency plan probably isn’t even optional for you. “Almost every business is required to have an emergency action plan” (EAP) to foster workplace safety, according to OSHA. You can use an OSHA online tool to determine whether you’re one of those businesses. But even if you aren’t, it’s a good idea to have one anyway. Plus, it might be required by your property-casualty insurance carrier. If it’s not, it will at least make them happier to do business with you.

Mandatory Emergency Action Plan

An OSHA-mandated EAP needs to include procedures for the following areas:

  • Reporting a fire or other emergency
  • Emergency evacuation, including type of evacuation and exit route assignments
  • For employees who remain to operate critical plant operations before they evacuate
  • Accounting for all employees after evacuation
  • To be followed by employees performing rescue or medical duties

The EAP also needs to include the name and job title of every employee who may be contacted by employees who need more information about the plan.

Under OSHA rules, if you have at least 10 employees, the plan needs to be in writing. Otherwise, it can be delivered orally. In either case, it needs to be presented to all employees. But since you’ll need to write it up to create the EAP (unless you can keep it all straight in your head), you’d might as well give employees a hard copy version even if not required to do so. They can refer to it when needed.

OSHA’s mandated workplace safety plan (classified as Standard 1910.38, should you want more detail) also requires you to designate and train employees to help evacuate other employees in an emergency, as well as any other specific tasks you might decide to assign them. You’ll also need to establish a communication system, possibly including an alarm, so that everybody will know what’s happening and what they need to do.

One way to ensure that employees know what’s in your safety plan is to involve some or all of them in creating it in the first place. They may be better acquainted with some potential safety issues and ways to address them, than you. Depending on the size of your staff, creating a safety committee could formalize the process.

Keep Your Emergency Plan Current

Your safety needs and the best ways to address them can evolve over time. That means you’ll need to revisit your EAP periodically to ensure that it’s up to date. Similarly, as you bring new employees on board, include presenting your EAP to them as part of their orientation process.

There’s more to workplace safety than following OSHA standards. For example, employees’ health—mental and physical—often play a role in workplace accidents. Government agencies do set standards for the maximum shift for employees with certain kinds of jobs, like truck drivers and airplane pilots. Otherwise, the only rule you have to follow is paying overtime for wage-based employees whose average weekly hours worked exceeds 40.

Naturally, physical fatigue can lead to serious accidents. But so too can employee job burnout. Among other effects, it can lead to increased mental distance from one’s job, according to the World Health Organization, not to mention serious health consequences. Being on the lookout for signs of employee burnout and confronting the sources of the problem can be an integral part of a workplace safety program.

Focusing excessively on every conceivable workplace safety risk could cause you to burn out, too. Avoid that by acting proactively to assess your risks and minimize them, then move on with the business of running your business.

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Do You Know How to Make a Profit Plan?

Is your business designed to make a profit? Do you have a target profit figure in mind? If not, you should consider creating a profit plan for your business. While a business plan shows the results you hope to achieve, a plan for profits details how you intend to make it happen. It puts you in charge.

To increase the chances of reaching your profit objective, follow this guide and learn how to create a profit plan for your business.

What is Planning for Profits?

In a nutshell, planning for profits requires management to make a set of decisions that describe how a company intends to reach a target profit level. As such, his plan details what actions will be taken, who will do them and when they will be done.

In this sense, a profit plan is a pro-active road map that an owner can use to take the company from Point A to Point B. It discourages wandering off on side roads and keeps the business focused on the goals.

The process of creating a profit plan forces you to make realistic evaluations of the strengths and weaknesses of your company, also known as a SWOT analysis. The results of this analysis will form the basis for determining a practical and achievable profit objective, not a pie-in-the-sky goal.

How to Create a Profit Plan

You will use the profit objective from the SWOT study to identify what steps must be taken to reach this goal. Is it a rise in sales, a reshuffling of your product mix, an increase in selling prices or a reduction in expenses?

Using your historical financial figures as a basis, identify the changes that will be necessary to reach your profit objective.

You must determine the actions needed and who will be responsible for the results. For example, you might:

  • Invest in research and development to modify product features to meet changing customer preferences
  • Expand by opening locations in other regions
  • Purchase more efficient production equipment
  • Negotiate better prices with suppliers to reduce costs of production
  • Hire additional sales staff
  • Spend more on marketing

Once you have made these decisions, the required actions can be incorporated into your profit plan. These actions can include making projections of revenues and setting costs for manufacturing products or providing services and establishing,  In addition, it should also include budgets for overhead expenses. Any additional capital investments should identify the sources of financing, either funded internally or with outside loans.

The resulting document becomes the road map that defines the company’s activities for the coming year. You can set up reporting systems with benchmarks to measure progress along the way.

How to Make Your Plan Effective

An effective profit plan should have the following traits:

  • Key managers and employees must be involved in the planning and development
  • The analysis must be thorough and address all of the company’s important short- and long-term issues
  • The plan should anticipate future trends and changes in the company’s market environment
  • You should make provisions for changes when key assumptions prove invalid

What are the Benefits of a Profit Plan?

In addition to providing a clear direction for your company, a profit plan has other benefits. A profit plan is useful for:

  • Giving managers explicit financial goals and objectives
  • Defining specific performance metrics for employees
  • Educating employees on the direction of the company to gain their participation
  • For motivating key employees
  • Establishing a foundation for making strategic decisions
  • Creating action plans as a basis for monitoring progress and measuring performance

Planning to make a profit is an important mindset for every small business owner. Profit plans create a different perspective of making something happen rather than working hard and hoping to get good results. You can increase your odds of success by taking charge of the business and directing it where you want it to go.

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Overcoming a Natural Disaster: How These Businesses Survived and Thrive

According to the Federal Emergency Management Agency (FEMA), overcoming natural disaster impact is a rough road for businesses.

The agency’s latest data indicates that 40 to 60 percent of businesses never reopen following a natural disaster. That number goes up to an astronomical 90 percent failure rate for companies that can’t reopen and resume operations within five days.

How can your business beat the odds if you happen to have a natural disaster strike?

The two businesses below have their own unique stories to share about overcoming natural disasters as well as tips to help any business survive and continue to thrive despite Mother Nature’s moods.

Three Brothers Bakery – Hurricane Harvey

The Jucker family business, Three Brothers Bakery, is a Houston-area tradition. Their three locations serve-up up baked delights for multiple neighborhoods. They’ve seen their pecan pie go nationwide through mail order. Their baked goods keep winning awards, and it’s almost comical to list all of their accolades.

Yet, it was four days of rain and four-and-a-half feet of water from Hurricane Harvey in late 2017 that turned their operations upside down. All three locations flooded. Business ground to a halt.

To manage the damage from Harvey, the Juckers took out $900,000 worth of loans from the Small Business Administration (SBA). “These loans were to survive,” says Jucker. “Most people take loans to grow. We could have built two new stores with those loans. That’s the impact.”

Revenue is still recovering, and they still get the question: “Why don’t you move your business?” That’s a rough one for people who don’t run businesses inside disaster zones to grasp.

“Businesses are different than homes,” Jucker says. “You can raise a home and be out of it while it is being raised or perhaps even tear it down and rebuild. We have a working bakery with lots of built-in equipment like ovens, coolers, freezers, and it is also our main store. It would cost millions to move it, and our store needs to remain because this is where the ‘horses come to drink’ as we have been here since 1960.”

Her best advice for other businesses in disaster-prone regions? Protect your business and plan for the worst.

Get flood insurance:

“No matter where you live, floods can occur. If you are not in a flood-prone area, [flood insurance] is very inexpensive.”

Gather your financials and inventory:

“When you are buying replacements [for damaged business property] that you might want to finance, these things could be important. If you want a loan, they are definitely important.”

Have available credit:

“Cash is king when you have no revenue, so we charged everything we could to preserve cash.”

Jucker’s also excited about the bakery’s growing mail-order business and encourages businesses to find revenue streams beyond their own backyard. This will keep revenue coming in, even if the neighborhoods served are affected by natural disasters.

The Boathouse Marina – Freak Maritime Storm

When Bill Bowman bought the Boathouse Marina in 2013, he wanted to be the king of customer service for the boating community along the Virginia coast. Anything related to overcoming natural disaster was furthest from his mind.

Colonial Beach wasn’t an area prone to disasters, so he set his sights on improving the marina’s services. Between 2013 and 2017, Bowman oversaw improvements that included a new captain’s lounge, ship’s store, restrooms and showers, WiFi, laundry, and more.

No one on the Virginia coast was ready for the freak maritime storm that came along in April of 2017. Gusts of 70-75 miles per hour destroyed the marina, causing over $1 million in damage. Bowman’s facility went without power for six weeks. Yet today, he’s here to tell the tale of how he and the marina made it through.

The area had countless downed trees and powerlines, so there was a curfew instituted for safety. “We did as much as we could during the non-curfew hours, cleaning up debris ourselves even when equipment and clean-up vehicles could not access our site,” says Bowman. He also rented and purchased electric generators and got the marina back in business for their clientele within four days.

Today, the marina has rebuilt, and Bowman’s vision for the Virginia boating community has come through stronger than ever. Beyond the improvements he’s made after the storm, Bowman has a keen eye on how he and other businesses can prepare for a disaster, however unexpected.

Make a call list:

“Prepare a call list that includes anyone who can help you deal with whatever may happen.” (Insurance company, contractors, etc.)

Train your team:

“Be sure all staff is aware of the plan and prepared to participate.”

Prepare for self-sufficiency:

“Don’t rely solely on outside services to help you. If they can’t get to you, you need to be ready to help yourself.”

These two businesses demonstrate that it’s possible to thrive even when the worst of Mother Nature comes calling. How will your business use their tips to create a plan to aid you in overcoming natural disaster? For additional resources to help your business plan in advance so you can be proactive instead of reactive, you can visit the FEMA website, review tips from the SBA, and reach out to your insurance providers and banks to explore options available.

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Small Business Cyberattacks and Ways to Prevent Them

The consequences of small business cyberattacks are no joke. IBM research shows that a small business data breach can be particularly severe for companies with less than 500 employees, according to a recent press release. In the study, small businesses suffered losses of more than $2.5 million on average.  The number equates to costing up to 5 percent of annual revenue.

And the effects of small business cyberattacks can be felt for years. In fact, IBM looked at the long tail financial impact of data breaches and found that 67 percent of associated costs were realized within the first year.  An additional 22 percent accumulated in the second year.  And, another 11 percent amassed more than two years later. Moreover, the long tail costs were higher in the second and third years for businesses in highly-regulated environments, such as healthcare and financial services.

However, small businesses can mitigate cyber risks by implementing some of the following security practices.

Use Access Controls

Strong access controls can help prevent small business cyberattacks. An access control policy should at least address who should access company data as well as the circumstances in which to deny access to a user with access privileges. Small businesses can use authentication factors to reduce cyber risk, including:

  • passwords
  • personal identification numbers (PINs)
  • biometric scans
  • security tokens

Implement Extensive Use of Encryption

Studies have shown that 96 percent of stolen data is unencrypted, according to IT Security Guru. Therefore, in addition to implementing access controls, small businesses should routinely encrypt their primary copies of data as well as their secondary copies of data, such as backups, migrations, archives, transfers and live data to keep information safe.

The extensive use of encryption can also reduce the total cost of a data breach by $360,000, according to IBM.

Deploy Security Automation Technologies

Security automation technologies allow businesses to handle security tasks that would otherwise be done manually. These technologies can automatically check for system vulnerabilities, for example, without human intervention.

And when it comes to cyberattacks, security automation technologies can help small businesses mitigate losses. According to IBM, businesses with fully deployed security automation technologies experience about half the cost of a breach compared to those that do not have these technologies.

Properly Vet the Security of Third Parties

It’s important for small businesses to vet the security of their partners and suppliers, as it can cost businesses $370,000 more than average when a data breach occurs, according to IBM. This can be done by ensuring that security standards align and by actively monitoring third-party access.

Have An Incident Response Plan

A solid incident response plan should be in place well before a cyber incident occurs.  Why? Because the speed and efficiency at which a small business is able to respond can reduce consequences. IBM finds that businesses with an incident response team and an extensively tested incident response plan have had approximately $1 million less in data breach costs on average compared to businesses with neither measure in place.

By implementing these security initiatives, or a combination thereof, small businesses can stay protected against costly cyberattacks.

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