About Business Logistics

I speak to individuals about the companies they work for, and they refer to different departments, such as Planning, Purchasing, Warehousing, Inventory Control, and Transportation. These are many of the roles within the scope of Business Logistics, yet their companies have not realized they are all intertwined and can be banked against each other; traded and bartered for better company discounts. Additionally, they mention Returns, which is actually referred to as Reverse Logistics.

All of these roles are components of the Supply Chain in every industry. Logisticians help companies realize cost savings throughout the Supply Chain. Speaking with Logisticians about the Supply Chain encourages businesses to locate and differentiate the savings their companies could reap. This leads to new profit opportunities for their organizations.

Once I speak to individuals about the scope of Business Logistics and what it entails, they are fascinated by it. They tell me I should speak to their Management about the cost savings they can make through tradeoffs of services. There should be more high profile papers and articles on Business Logistics to educate the business world. It’s not just something students should learn about in college.

Supply Chain assists organizations with cost savings by streamlining the Planning and Purchasing roles so that the right materials are at the right place at the right time, so manufacturing can continue in order to exceed Customer expectations. No manufacturing down time is the goal of many businesses, in order to achieve just in time advantages. JIT can either reduce or eliminate inventory carrying costs of the organization, and can promote lean manufacturing processes. Lean manufacturing processes initiate cost savings throughout the Supply Chain, and savings can be transferred to Customers.

Benefits of Balanced Content

This may seem like a counterintuitive concept but let me explain. In my global work with leading speakers, authors, and thought leaders, I’ve noticed that most content is out of balance. Authors and thought leaders have a tendency or a bias. They are either incredibly academic or hyper focused on business, and this makes sense, given that many thought leaders come from either the hallowed halls of academia or the shining towers of the corporate world. Their world view and perspectives are shaped by their experiences.

Now there’s nothing inherently wrong with leaning towards business or academia. The content market admires, appreciates, and consumes content that leans in either direction. That being said, the best content I’ve seen is balanced. It has hard data to support the theories and it is peppered with stories and anecdotes based on the content’s real world business application. All too often I’ve heard academics snobbishly dismiss a business book written by a world renowned CEO because it doesn’t have an academic underpinning or data. I’ve also heard many C level execs discount the potential value of content that comes from academia as they claim that it wouldn’t work in “the real world” of business.

I’d use the Switzerland strategy. Be neutral and open to the needs and concerns of both sides and respect them both. For example, if you’re a less academic thought leader, put the effort in to finding some academic research to validate your concepts and theories. Chances are there is academic work that has been done that you can cite and it will neutralize the darts that academics may toss at you. Conversely, if you’re an academic you need to get out into the field and talk to business leaders and run experiments in the real world to validate your claims. Oftentimes things that should work just don’t for a variety of reasons; the lab is not the same as the market place.

Now you have one more thing to keep balanced in your life, however, the benefits of cross pollinating your work will make it stronger and reduce the resistance as it spreads across an organization.

Importance of Business Systems

Business systems are documented procedures setting out how your organisation operates. They are processes, usually combining actions taken by people and some form of automated application, organised in such a way so as to meet a given set of business objectives. Such systems can generally take place without the business founder / owner’s direct action, over and over again, as efficiently as possible.

Examples of processes may include how your staff should answer the telephone, how they take and pass on messages; the procedure for raising, approving, placing and receiving orders; the process for generating, checking and sending out client invoices, as well as receiving payments and following up on outstanding bills etc.

Regardless of the size or type of your business, it is likely that you already have set procedures in place covering many functions within your organisation, which employees follow out of habit or as directed by their supervisor / manager.

Business systems are the manual for your business; the “know-how” of any business that many business founders / owners usually hold in their head, and have not got round to putting onto paper.

There are many reasons and just as many benefits for having established and documented systems in your business, some of which include the following:

  • They provide a framework for your operations and an effective structure to support your business.
  • They improve consistency: production, delivery, customer service, after-sales care etc.
  • They improve results and/or productivity, because you and your employees don’t have to re-invent the wheel every time.
  • They provide a better work environment for your employees, as an effective system will contribute to clarifying roles and responsibilities as well as providing staff with some guidelines to refer to.
  • They ensure compliance with legislation, safety regulations or any other legal requirement specific to your type of business operations.
  • They give your business the ability to expand and they facilitate business growth, as they will make your business more attractive to any potential investor or buyer.

Although there are similarities across many functions, such as Accounts, Human Resources, Sales, Stores, Logistics etc., unfortunately there is no one perfect, one size fits all system that works for all companies. Any system will need to integrate the company’s business objectives, its people and the way it provides its products or services.

It is important to have a well-designed system, customised to your type of operation, and thought out by people at all levels within the organisation.

Such a system will be more likely to be followed by all employees, because they have been involved in its design, and they understand the value that having a system in place brings to the quality of their work and the service they provide to customers.

One point to keep in mind is that having great people working with poorly designed systems – or no systems – is likely to lead to an under-performing business. On the other hand, great systems without good people won’t work either, hence the additional benefit of involving employees in designing a system, or simply in documenting the processes they are following.

Equally so, employees who have been trained in your business systems should also feel empowered enough so that they don’t feel they just have to follow a given script without using their head.

For this reason, it is important to encourage feedback not just from your customers, but also from your employees and to use such comments to review and to continuously improve and develop your business systems.

Start Home Based Travel Businesses

Home based travel businesses that fall into the referral agency category do just that: they refer people to a travel agency. They may have several agencies they refer people to, but most generally have one travel agency that they work with on a regular basis. In return for the referrals from a home based business travel agent, the travel agency pays a referral fee or commission percentage on what the travel agency receives from the supplier. Part-time referral agents can earn up to $500 on each sale, and sometimes even more.

The home based travel businesses that fall into the booking and selling agencies category usually work with one travel agency. These booking and selling travel agencies actually do the booking and planning involved in making all the necessary arrangements for great trips.

These are people who enjoy attending to all the little details. They serve, more or less, as facilitators between their clients and a travel agency. Booking and selling home based travel business agents earn a lot higher percentage of the overall commission-but they DO do a great deal more work. A full-timer at this, however, can earn $50,000 or more a year.

Some things you want to consider before you decide to open your own home based travel business are:

  • Do I need any special training or education?
  • Should I pursue this part-time or full-time?
  • Is my family supportive of my decision?
  • Do I have a room in my home where I can set up an office?
  • Should I get an extra phone line?
  • What sort of office equipment do I need?
  • What will I do about accounting?
  • How do I manage my tax needs?
  • Is this a job I will love?
  • How much money do I want to make?
  • Should I do any advertising?
  • Do I have the contacts I need to pursue this business opportunity?
  • If I don’t, how do I make the contacts I need?
  • Am I willing to put the necessary effort into this business?
  • Does my state require me to have a business license?

Once you’ve answered all or at least most of these questions, you will need to make a business plan, outlining the steps you’ll have to take to achieve your goal of having your own home based travel business. And a plan just isn’t any good unless you follow it.

You also need to make sure your business plan is realistic. If you have to take a course to run the type of travel agent home business you want to have, deciding to open up shop next week isn’t reasonable. By being realistic in your business plan, you will save yourself an untold amount of frustration as you start and grow your business.

And starting your own business, whether it’s a cruise travel home business or a European vacation home travel business, can be frustrating. Be prepared for obstacles to raise their ugly little heads when you least expect them to, and roll with them as much as you can.

Your goal is to offer superior, professional travel services. Don’t let a cranky client get to you. Always keep a pleasant, cheerful demeanor. You can scream later. Better yet, you have a laugh or two over it with friends, while sipping a glass of fine wine that you bought with the money you’ve earned as a home based business travel agent.

Find a Good Accountant for Your Cleaning Business

Perhaps you’re a sole-proprietor who is thinking of incorporating your business. Your accountant will be able to advise you about how this move would affect your taxes and business growth. Or maybe you have questions on whether you should buy or lease a new truck for your business. Once again, your accountant will be able to help.

So how do you go about finding an accountant who is a good fit for you and your cleaning business? Here are a few tips:

  • Ask other business owners for references. Find out who their accountants are and how happy they are with the services their accountant provides.
  • If you can’t get any references, go to the yellow pages and search the listings for several firms to contact. Call their offices and ask for the names of accountants who are familiar with cleaning businesses. Call four or five of the accountants on your list and ask them to tell you about their experience with working with clients in your industry and about their fees. From that information, narrow down your list to two or three accountants to interview in person.
  • Prepare a list of questions to ask at the interviews, including:
  1. Do you have experience working with cleaning companies? (As a cleaning business you have unique expenses, including cleaning supplies and equipment, so it’s helpful to find an accountant who understands your business.)
  2. How long have you been an accountant?
  3. What certifications do you hold?
  4. What continuing education or workshops do you attend?
  5. What is the hourly billing rate and what are the charges for extra services such as completing tax returns or helping with payroll?
  6. Who will I be working with and will I always be working with the same person?
  7. How accessible will my contact person be? Can he be reached by phone and e-mail? If I have to leave a message, how soon will he return my call? Will I be charged for every phone call?
  8. What other services do you provide and at what fees?
  9. If my cleaning business is audited, what are your responsibilities?
  10. What type of insurance do you have? (They should carry liability and errors and omission insurance.)
  11. Look for an accountant who is forward thinking. Ask what problems he might foresee and what he would do to correct those problems.
  12. Also remember to ask for references and then be sure to call those references.
  • Meet with several prospective accountants and ask your questions. An accountant should be willing to meet with you for a brief “get to know you meeting” at no charge. A face-to-face meeting will help you to assess if you are comfortable with him or her and if you can establish a long-term relationship. As you are asking the accountant your questions, watch their body language. Do they seem interested in you and your business? Have they communicated with you in a language that you understand and not used accounting language jargon?

Service is important. If the accountant doesn’t seem interested in you and your business or takes calls during the meeting, it might be best to move on to the next candidate who will devote his full attention to you and your business.

After interviewing several candidates sit down and decide which one you are comfortable with and that you are confident has the knowledge and abilities to keep your business finances on track. Once you have decided on who you want to work with request a written estimate of costs that spells out what your responsibilities are and what your accountant’s responsibilities cover. Knowing what you will be doing and what your accountant will be doing can eliminate confusion and save you time and money.

Remember, your accountant should be more than just someone who prepares your tax return. He or she should be able to help you in making important financial decisions that guides your business and makes your business profitable. Spending time and effort in finding the right accountant when starting your business can help to assure your cleaning business is successful in the long run.

About Thyself and Thy Business

If you can’t describe yourself, your ideal client and your business in brief, simple language, how is anyone going to hire you or give you a referral? As an entrepreneur, business owner or independent professional, you need to be able to tell advocates, clients and networking participants what you do, how you do it, who you do it for and why they should choose you.

If what you do is help people build their business and how you do it is: a) one-on-one, b) training and c) workshops, this information presents a clear picture to prospective clients. The next section, who you help grow businesses for, is self-explanatory. The only question remaining is the size of the business. Let us choose businesses that generate up to $20,000,000 in revenue per year and independent professionals who earn $100,000.00 or more per year.

Positioning yourself by concept or model removes the stress for you and your clients. Create a model that motivates, excites and attracts. Your model could be that you work with people for a specific amount of time, say ninety days, for an established fee (received up front!) and you have a predetermined number of conferences with them.

This method makes it very easy for the right person to say “Yes!”.

A model or environment that clients can connect and feel safe with is essential. If it is presented as “work”, they won’t hire you. The experience for each of you needs to be rich, fulfilling and enjoyable.

Here’s an example of positioning by concept. It’s one thing to say you’re a website designer. A more definitive statement would be to say you design websites for people who are ready for a revised website; know who they want to reach with this website; and have text ready to serve this audience as well as the resources to pay for your expertise.

It’s specific and would attract the perfect client to you as well as your method of working.

The last question is, why choose you.

A simple answer is that you have the knowledge, skills and experience critical to their success. Go for it!

Legal Issues of Starting a Business

Other issues that you have to look at when starting a business relate to finding a suitable location, a building and the staff that you can work with. Of course, you do have to have insurance on the building and the stock if you sell products and if you provide services, you will need to have your equipment insured. You might say that you plan to run an Internet business out of your home so none of these issues will apply to you. No matter what kind of business you have, you need to have a business taxation number that allows you to collect taxes from your customers. You also have to pay taxes on the income that your business generates.

If you plan on opening a business where you prepare or serve food, then you have to deal with health and safety issues. Government inspectors will do regular inspections to make sure that your premises are clean and that you prepare the food in the proper way. If you wish to serve alcohol, you will have to obtain a special licence.

Having your own business also means that you have to deal with issues of hiring and paying staff. Accurate financial records are necessary in order for you to determine whether or not your business is making a profit. If you don’t have the talents to do this on your own, you will have to hire an accountant to help you out. These are all issues that you have to consider when you decide to start your own business.

About Integrated Talent Management Strategy

Talent Management involves several practices linked together and propelled by organizational infrastructure. It begins by having a firm written understanding of the core capabilities needed to perform tasks meshed with the actual business intelligence for the industry. For this article’s example we will be using the financial services industry, but we must remember that support functions like IT, Human Resource, Accounting, and Purchasing have unique business intelligence issues that need to be included any industry strategy.

While banking business intelligence is similar from one institution to another, your market, choice of products and services and unique culture make for a different plan and approach. The clarity of goal for talent management is essential before assembling the pieces.

One of the most complete models for a Talent Management Strategy I have found includes the following nine practices:

  1. Recruiting & Staffing
  2. Performance Management
  3. Rewards & Recognition
  4. Workforce Planning
  5. Talent Review
  6. Succession Management
  7. High Potential Development
  8. Leadership Development
  9. Employee Development

These practices are not in any particular order or priority because they all must be in place, and integrated for the strategy to be effective. Rolling out one at a time is a waste of energy and leads to minimal impact. This is probably the main reason many companies have hired a Director of Talent Management to design, implement and monitor the strategy. To be effective, no other function can add all this to their existing workload.

Now while it is more effective to put talent management under the responsibility of a single leader, the practice responsibilities are spread throughout human resources, training, and selected management sponsors. This initiative may begin with the Board of Directors and/or Senior Management; but it eventually is a process that involves every single employee if it is to be successful in achieving a lasting effect.

As you review the list of practices, it becomes clear that the focus is on your employees (the talent) and the conscience attention to setting and achieving desired outcomes to function in today’s economy as well as being prepared for changes in your workforce and working environment. Banks often promote their technologies to clients, and yet it is our human capital that makes the bank possible. Let’s face it, years ago we did it without as much technology, but we still need the human factor to make it happen today.

Now while you might hire someone to management this whole process for you, by the very nature of this much change all at once you would be wise to bring in an external consultant to guide the creation of the strategy. Someone who fully understands what integration means and how it is applied to each of the practices. This consultant acts in many ways as someone who can act without emotional attachment to ancient practices, and is skilled in bringing consensus between processes and people. Yet consensus is not everything. The consultant is not going to be with you forever, so part of their job is to make sure your management team comprehends what integration means, and a year later can identify issues in your strategy, and how to make tweaks to close the loop holes.

Doing Good Business

  • Everything within the budget – apparently your business can only go as far as your budget capital can and anything beyond that would be bank loans and debts. So make sure that everything you will spend, from marketing, procurements and payroll has to be within the scope of only what you can spend. Besides, it’s never good to start a business on loans just do what you can with what you got.
  • Plan a good marketing strategy – your business doesn’t have to have a huge budget in order to make it work. In fact most of the successful people in history started out with so little that it’s almost impossible to believe that they were able to raise an empire out of their spare change. They only had a great idea and a very good plan to make it all work out – and it did!
  • Take your business to where the customers are – you don’t go fishing in a pond do you? Of course not! That would be absolutely useless, no, you go to where the fish are which is in rivers, lakes and seas. The same is true with any business. No one sets up a store in the middle of nowhere, all stores are found in cities and urban areas and that’s because there are people there to buy what you’re selling. Basically any individual, crowd or masses can be a potential customer and the idea is to encourage them to make a purchase.
  • Make a good presentation of your product or service – as part of your marketing strategy, you must understand the importance of having a very good presentation of your product or service. This is where the advertisements come in and you can make your presentation in print, audio or video formats. In fact most business owners do all three and they even have ads on the internet as well.
  • Put up a good fight – it is very rare that something new and unique will appear in business today, so presumably yours is just a variation of a business that’s already in circulation. The number one thing to keep in mind about business variation is that there will be competition. You will be forced to do whatever it takes to outperform your competitors or they’ll be the ones who will kick you out of the business. Lucky you if you have an entirely new idea and little or no competition will go against it.
  • Hire an accounting firm – whether you’re operating a small or a large business the accounting and bookkeeping work can become a problem for you. To avoid unnecessary problems such as this (which is also very time consuming) it would be best to hire an accounting firm to balance your checks, do your bookkeeping and calculating your taxes.

Prescription For the New Economy

Well, first I can tell you that it’s not the kind of innovation that has made the term little more than a buzzword for many of us. In this article we will explore a common sense process for understanding exactly what type of innovation is prescribed for this new economy, and some proven strategies to get it done.

In the past, the term innovation has most commonly described new products or services that create new markets or leverage untapped opportunity in existing markets. The innovation needed to thrive in the new economy will likely go well beyond new offerings to involve changes to your entire business model in order to be effective.

In a recent edition of Trends Magazine an article featured a list of questions that every business should ask about their business model in order to insure they succeed in this new economy. While discussing that concept with a colleague, we began to put together a similar list for small and medium sized wood products manufacturing businesses. Here are five key questions we came up with:

  1. First, what is main thing your business must do in the new economy to assure that you are paid the highest price in a timely manner for your products and services?
  2. Second, is there anything about how you produce your products that a customer can understand that would justify paying you more than your competition?
  3. Third, what can be done to reduce the cost of producing your products that will not reduce quality, value, competitiveness or profit?
  4. Fourth, what can be done to reduce the costs of keeping, managing and training employees?
  5. Fifth, if your primary customer base were reduced by half next month what would you do immediately to replace that lost revenue?

If you can confidently provide the answers to those questions you are well on your way to grooming your business model to insure growth and stability in the next decade. If you cannot answer some or all of those questions… well, you are probably already well aware that some changes need to be made. So how do you begin the process of improving your business model so it can thrive in the new economy?

Let’s consider the best or at least the most profitable answers to the five questions above. You might even consider each one as a category by which to evaluate your business model for possible innovation that is compatible with the new economy.

  • First, the best way to be paid a fair amount in a timely manner for your products and services is to deliver a flawless product consistently and more quickly than your competitors, or at least in line with the customer’s best expectations. If this is not currently possible for you to accomplish then you will constantly be chasing market share in the new economy.
  • Second, unless you are in a very unique market, there is virtually nothing about how you produce your product that most customers would understand, that would compel them to pay you more than one of your competitors that is offering a product that is similar in functionality and appearance.
  • Cabinetry and wood products have been trending in this direction for years but in the new economy it will be a given. In many cases previously rigid architectural specifications have conceded to this reality in most parts of the country and on many jobs, resulting in stapled cabinets hanging right down the hall from cabinets with traditional high quality dowel construction.
  • Third, the most effective ways to reduce production costs without suffering any negative impact on your products or market share can be divided into two categories: automation and standardization of all processes that are high value or high profit and elimination or outsourcing of all processes that are not. If any of the processes that your business model requires to move a job from contract to final payment are not adding significant value or effectively expediting completion you have a weakness that is either reducing your profit or your ability to compete in the new economy.
  • Fourth, the only practical way to reduce employee related costs is to reduce the number of employees and the overall skill levels required. This can factor heavily into the decisions you make with respect to the third category of innovation above. As badly as this country needs more high paying jobs, most wood products manufacturers are not going to be able to provide them and remain competitive in the next decade.

It is truly sad for me to accept this reality, being a lifelong woodworker and cabinetmaker that started as an apprentice at the age of 14, but this is now an inescapable truth. Between the unknown costs that are being created by new laws, insurance requirements, etc, the decline of skilled craftsmen in the workforce combined with low interest in the skilled trades among young people, your ability to retain quality employees and control related costs is decreasing at an alarming rate. Ironically, your best shot at being able to create new jobs in the future may depend on how effectively you can reduce these costs now in order to adapt to the new economy.

  • The fifth and final answer is perhaps the most dynamic. What would you do if there is a second bump in the economy for your niche market or what if a large high-volume competitor decides to expand market share and cuts your prices in order to get your customers? The answer to survival in such situations is often not about where to look for the new customers but how quickly you can adapt to service them competitively and profitably when you find them.

The key is having a business model behind your products and services that can shift into another gear quickly so you can secure that new business by delivering flawless products on time when you get a shot at a new opportunity. That requires a finely tuned chain of processes that can take a job from contract through design and into production for a wide variety of products without major rework on a first run.