Our final area of practice relates to technology start ups.  As existing business owners and managers, many of you understand what it takes to start a business, both in terms of time, energy, and money.

Throughout the 1990’s it was very easy for anyone to start a technology company.  Financing was readily available to anyone who had a remotely plausible idea.  We have all since learned our lesson.  Today, the landscape is much different.  Technology start ups must prove the validity of the product or service as well as the capability to manage the business.  In addition, many of the products require some amount of research and development prior to production.  This can be very costly.

Many times, in order to obtain the necessary funding, a new company must conduct a feasibility study as well as develop a business plan.  This process can be somewhat demanding and time consuming without a clear understanding of how to gather the necessary information.

Although the technology industry is not as strong in Western North Carolina as many other industry, there is a small base of these companies here.  There are also a few resources that can assist these companies in getting started.

Technology is something that we all use everyday.  It is an industry that is going to continue to grow and evolve at a rapid pace.  We are happy that we are able to help those businesses that make all of our lives a little easier.

Continuing the discussion about our four practice areas, we will now turn our attention to Turnarounds and Workouts.

Turnarounds and Workouts refer to companies that are in trouble of going out of business.  Usually, this is a result of tight cash flow and the inability to pay bills.  There are problems with paying secured and unsecured creditors.  All lines of credit may or may not be completely tapped out.  In short, revenues are not sufficient to maintain the business.  The Turnaround and Workout is designed to bring the business back to solid revenue generation where long-term net profits are realized.

In “Navigating the Current Economy” both parts one and two, we discussed the reactions some business owners have in response to an economic downturn.  There is a tendency to react in a similar manner when our business begins a sustained downward turn.  These reactions are overreacting and the Ostrich Syndrome.  These two reactions can be just as detrimental to a business when internal problems begin to arise as with external problems.

Oftentimes, when things are going well, problems, issues, or inefficiencies within the business may not be noticeable.  This is because there is sufficient cash flow to negate these taxing practices.  However, if more strain is placed upon cash flow, such as sales falling enough or the expansion of operations or personnel, these inefficiencies and problems come to the fore.  The result is the symptoms of the real problems become very noticeable.

Believe it or not, many Turnarounds and Workouts are the direct result of a business trying to grow.  During the growth phase, the business outpaces the available capital.  In other words, the business grows too fast.

The Turnaround and Workout process is designed to identify and address the root causes of the distress.  This requires a full team approach.  The first step is to negotiate with all creditors, including banks, vendors, and credit card companies.  By pacifying the creditors, and stopping the flood of phone calls, the team, along with the business owner, is able to focus on more important matters, such as streamlining operations, increasing sales, and collecting accounts receivable.

One way to help prevent a business from becoming distressed is to develop a strategic plan, or a blueprint, for the business.  A strategic plan allows owners and management to consider the direction of the business and have a basis for decision making.  Through the development of a plan, management is able to consider a number of scenarios that the business may encounter without the pressure of having to make an immediate decision. 

Most of the time in business we must make decisions on the spot.  We do not have time to gather all the needed information or research.  By developing a strategic plan, much of this work is done ahead of time.  This is not to say that we will have all the answers and all the information we need every time.  But, we will, at least, have considered many possibilities and their potential outcome.  We will know the general direction we want to go.

A strategic plan will also provide us with guidance when we want to grow or expand the business.  It will help prevent us from becoming a Turnaround and Workout.

The next blog will focus on the final practice area of Technology Start Ups.

Our second area of practice focuses on Emerging Growth.  This may sound like it only relates to new, start up businesses.  However, this is not the case.  Emerging Growth refers to those businesses and organizations that are ready to move into the next phase of development.  They have reached a plateau and are ready to move forward.

Before getting deeper into a discussion about how to grow a business, I want to talk about what growth means.  For many of you, your business is your dream.  It is not just something you wake up and go to, you live and breathe it every moment of every day.  You have a passion and a vision of what you want the business to be and accomplish.  So, the first step in growing your business is understanding that vision and knowing what your goals are.  Some things to consider are:

• What are your short, mid, and long term goals for the business?
• How big of a business do you want to grow?
• What does growth mean to you? Increased revenues?  More locations? Franchising?
• What steps need to be taken prior to growing the business?
• With what services or products will growth occur?
• In what target market segments will growth occur?
• Will new market segments need to be targeted?
• Will the business need to expand the geographical reach?
• What are the most efficient methods of reaching the new target markets?
• What are the needs, desires, and motivating factors for each market or customer set?
• What is the current depth of each targeted market?
• What is the projected cost of acquisition for each $1,000 of new business?

The key is to truly understand your goals for your business.  Growth is not just about hiring more employees or increasing revenues.  Growth can come in many forms, as illustrated in the above questions.

Growth, in some form or another, is typically the goal of every entrepreneur.  But, there are many dangers in growing a business.  Growth usually means that additional capital will be needed.  How much capital will be needed?  Where will the additional capital come from?  What measures need to be taken to safely grow the business?  During a growth phase, it is very easy to outpace existing capital sources and revenues.  Additional acquisitions; whether employees, equipment, or facility upgrades; can easily create more debt than can be fulfilled by the business.

The keys then to growth are to know where you want to take your business then develop a plan and a timeline to accomplishing those goals.  Just be sure that your timeline is reasonable and not too aggressive.

Continuing our discussion about what we do, the next four blogs will focus on each of the practice areas that we focus on within the firm.

Let’s look at Family Business Succession Planning first.

Family Business Succession Planning is just that, it is planning how to pass the business on to the next generation. So, ...

From time to time, even a consulting firm has to step back and evaluate its strategies and tactics in order to effectively communicate its message to the markets it serves. As we are in the process of developing our goals and objectives for an upcoming face-lift of our website, it became clear that we can do a better job describing what it is we really do. This blog entry was written by Ron Sanga, one of our Asheville based associates. Please check back periodically for future segments ...

BluePrints for Business’ Business Improvement Grant (BIG) Program for the Haywood County Chamber of Commerce will move into its second phase as the Western Carolina University College of Business joins forces with the Asheville firm to conduct an economic impact study for the Chamber.

BluePrints for Business, a strategic business consulting firm in Asheville, funded the BIG Program, valued ...

As many of you know, we recently conducted our BIG Survey.  The survey was an expansion of our Business Improvement Grant (BIG) Program we began last year.  We began this program to help local arts presenters and other non-profit organizations here in Asheville, throughout Western North Carolina, and in the Upstate of South Carolina.  

This year, we decided we wanted to do more to help small businesses so we expanded the program by conducting the BIG survey. Respondents to the survey had the opportunity to win one of three grants.  The top grant was for $5,000 in services, second was $2,500, and the final grant was for $1,000. 

The winners of the grants are as follows:

$5,000 – Tim Johnston and Sisters of Mercy
$2,500 – Robert Aldrich and laceName w:st="on">BenlaceName> laceName w:st="on">CraiglaceName> laceName w:st="on">Center
laceName>$1,000 – Bruce Johnson and Champion Supply

We would like to thank everyone who participated in the survey.  We were able to gain a better understanding of the current challenges you are facing.  This will assist us in providing the Western North Carolina community with improved services.