Wyoming Entrepreneur Blog

Developing Cash Flow Projections

Have you applied for a business loan and been asked for projections or a cash flow?  Most lenders will want this information but entrepreneurs often don’t know where to start.

If you are an existing business you can use your historical financial information to project out what the next 12 to 24 months will look, including the debt service on the new loan you are applying for, any new sales or revenue that investment will create, and what might go away (for instance rent if you are buying your own building versus leasing). The purpose is to demonstrate that you understand how your income and expenses will flow in and out (cash flow) of the business, and that you can repay the amount borrowed.  Include some margin for error since nobody ever projects perfectly.

If you are just starting a new business, this is a little trickier.  Estimating the expense side is usually easier than the revenue.  You can negotiate rent, find out what utilities cost, price insurance, set a marketing budget, and so on.  Sales are another matter.  How many people will by your product or take advantage of your service depends on what it is, competition, how much marketing you plan to do or can afford to do, and a whole host of other factors.  Since you will have some of your hard-earned money and time invested in the deal as well, you want this estimate to be as accurate as possible so as not to enter into this venture only to have it fail.  Remember to account for how much, if any, money you need to generate from this business to sustain your lifestyle.  If you have personal bills and living expenses that must be paid, that needs to be factored in.

I usually recommend to my clients that they generate projections for at least two years (some lenders will want three).  Wyoming Entrepreneur has a very good template on the web site, www.wyen.biz, under the Start a Business tab.  It includes a loan calculator to assist in determining what that new debt will cost you.  This template generally satisfies the format a lender wants to see.

Remember, it usually takes more money and more time than you think to get the business to the point where it is operating at a profit on a monthly basis.  Be especially careful with highly seasonal businesses and recognize that when you start can make or break the deal.  For assistance in developing these projections contact the Wyoming Small Business Development Center office in your area, or call 1-800-348-5194.

Amazon's Top 10 Leadership Lessons

I just read an article the April 23, 2012 issue of  Forbes article, George Anders talks about Jeff Bezos’s “Top 10 Leadership Lessons.”  The article is well worth reading, but to summarize here they are.  Jeff Bezos, the founder, president, chief executive officer (CEO), and chairman of the board of Amazon.com.   This is a guy who walks the walk and has created one of the most innovative and game changing companies ever. 

1)       “Base your strategy on things that won’t change.”  In Amazon’s case this means that to sell more things, offer wider selection, lower prices and fast and reliable delivery.

2)      “Obsess over customers”.  When you have a meeting of the important people in your company who’s missing?  At most companies the answer is “the customer”.  At Amazon, the customer is always the  prime consideration.

3)      “We are willing to be misunderstood for long  periods of time”.  Most companies expect success in short order.  Bezos is willing to stick with a plan for a long time if it makes strategic sense and if there is a good long term payoff.

4)      “There are two kinds of companies: those that try to charge more and those that work to charge less.  We will be the second.”  Most companies talk about holding down costs, but Amazon lives for frugality.

5)      “Determine what your customers need, and work backwards.”  At many companies products flow from the engineers and reflect their tastes.  At Amazon, the desires of the customer are considered first.  If the customer doesn’t like something, then Amazon gets rid of it.

6)      “Our culture is friendly and intense, but if push comes to shove we’ll settle for intense.”  At Amazon results and data count more than building a friendly culture.  I’m not sure I agree 100% with this idea, because I think a friendly, cooperative culture has huge dividends, but it is hard to argue with Amazon’s results.

7)      “If you want to be inventive, you have to be willing to fail.”  Lots of books and experts say this, but Amazon has lived it.  They have had numerous failed initiatives, but they learn from them and move on.

8)      “In the old world, you devoted 30% of your time to building a great service and 70% of your time to shouting about it. In the new world, that inverts.”  In this age of viral videos, social media and consumers who talk about their experiences, the old way of advertising is dropping away. Instead you need to work with your customers and get them involved in your company.  Word of mouth (or keyboard) really is key in today’s world.

9)      “Everyone has to be able to work in a call center.”  Amazon managers, including Bezos, work at least two days a year in the call center handling complaints.  Does your company president?

10)  “This is Day 1 for the Internet. We still have so much to learn.” Bezos said this in 1997.  It is still true today.  Just look at the number of companies that have come and gone since 1997.  Amazon is still here.

The lessons of Amazon and its success have bearing on us here in Wyoming.  After all, JC Penney started in Kemmerer.  Who’s to say some Wyoming company won’t be the next Amazon?  What do you think? Are these a good set of rules for today’s company?

Your Company’s Name – It’s Where It All Starts

I’ve had a number of clients over the years ask me why their company never shows up on search engine results.  There can be any number of reasons why search engines aren’t “seeing” your website.  However, I’d like to discuss one that often times is missed in the rush to “optimize” a web site.  A key reason for search engine invisibility can simply be the name of your company.

When Google looks at a search term, it tends to first think of it as a brand before anything else.  Ann Smartly, writing on the MarketingProfs website (www.marketingprofs.com) gives an example of the results for the term “Armstrong”.  She indicates that most people would think of “moon”, “space” or “Tour de France”.  Most people would be wrong.  Google shows “Armstrong Flooring”, “Armstrong World Industries” and “Armstrong One Wire (an internet service).  The astronaut and the bicyclist follow these “brands”. ; As Ms. Smartly says, “Google seems to favor brands and is likelier to suspect that your intent is navigational instead of informational (go instead of know).”

One way of winning the war is to instead of fighting a battle against multiple opponents; try to make your brand name unique.  This can be challenging if you have a common name.  “Jones Consulting” would be a pretty poor choice.  There are a lot of companies with that name out there.   Renee Jones Engineering Consulting would be better, but with such a common name, you might need to look for a more unique usage.  “Rock Springs Engineering Consultants” would, as I write this, probably come up first in Google as there are no companies showing up with that name. 

The idea is to become the dominant interpretation of the combination of words in your company name. Google suggests that if you can make your name and brand stick together, you instantly become a dominant interpretation.  Using this concept, a company called Renee Jones Mining Engineering would likely rank number one on Google.

So there you have it.  Before you worry about optimization of your site, and certainly before you sign incorporation papers, spend some time searching names on the internet.  A unique business name can be an important first step in achieving online visibility.

Have you had problems naming your company?   Do you have a great name?

I am a graphic designer who is considering joining a “coworking” space. Why should someone choose this, instead of just working from home? - Cindy in Lander, WY

Coworking spaces attempt to capture the best of different workspaces where freelancers and independent workers get things done— the flexibility of a home office and vibe of a café— and bring them together with an emphasis on collaboration and building community.

The benefits:

Greater motivation. Productivity spikes when you’re working alongside other entrepreneurs. Coworkers join their coworking spaces because they find that the environment, in one form or another, satiates their own psychological craving for a community of like-minded entrepreneurs.

For many, it’s about the energy boost of being around other people. Alan Pinstein, who runs his real estate software service Neybor out of Ignition Alley, tells us, “We can all learn from each other and meet new people. It’s great, especially for people coming from a work-at-home situation where they need the social interaction and need to see people around to feel some energy in the room.” Alan compares the experience to the energy of being in a large metropolis. “I used to live in New York City and [coworking] brings that energy you find in the streets of New York to your office environment. To me, being here you get to feel everybody’s energy everyday.”

Graphic designer Judi Oyama’s experience at NextSpace told us that one of the core attractions of coworking for small businesses is that it enables you to get things done by filling in any gaps in skills and needs. When you aren’t stymied and stonewalled by things you can’t do, you feel motivated to launch new projects and try new business ventures.

Quality social encounters. Coworking gives you more social interaction. Join a space and get out of your pajamas and out of the house. Industrial and graphic design expert Anthony Grieder exchanged his home office where he had run Alloy Design, Inc. for over a decade for coworking space Boulder Digital Arts after coming to a realization that he wanted more people around him. “I had been in a home office for the past 12 years, and needed to get back into a more social situation.”

For others, being around people is a necessity for their business, especially for those in the creative field. Graphic designer Johnny Bilotta says that he turned to coworking at Indy Hall to test ideas and get immediate feedback. “One of the things I lost by working at home was the social aspect of going to an office. I couldn’t bounce an idea off of somebody, and being a designer, I need people’s opinions on things. I like to get people’s opinions on colors, for example. Even if it’s just waxing philosophical over a cup of coffee about a different design philosophy or something— I missed that from working at home.”

A professional venue— and outlook. Going to a coworking space disciplines your approach to your independent work or business. Franchise business consultant Kyle de Haas, a member of Cospace, likes how coworking puts him in a professional, ready-to-work frame of mind. “There are too many distractions at home that deter me from being as efficient as I’d like when I work,” he tells us. “I’ve learned over time that I respond well to getting dressed and going someplace to get work done. It promotes a healthy work-life balance.”

Instructional designer Lisa Van Damme marvels at how coworking at Boulder Digital Arts provides the right incentives to do her work in a more professional and balanced way. “There’s something to be said about getting dressed in the morning and leaving the house versus working in pajamas ten steps away from the bed.”

‘Accelerated serendipity’ galore. With coworking, communities can be very diverse, and you never know whom you’ll bump into in an encounter that could change your business forever. Freelance writer Kevin Purdy tells us, “I gained at least ten successful Lifehacker post ideas from working at Coworking Rochester, if not more. Personally, I’ve picked up post ideas and topics galore from Coworking Rochester for my freelance writing projects.” He also says that “problems I’ve had with my personal website, or even my out-loud ‘I wish I could…’ queries, have been tackled with enthusiasm whenever I’ve coworked.”

Action Alliance for Children’s Lisa Shulman Malul, a member of The Hub Bay Area, explains how crucial this exchange of ideas is in keeping their organization relevant, their ideas fresh, and their energy levels charged. “I think in any field you can get used to talking about your issues or the things that you cover within a narrow spectrum. The idea of interacting with [different audiences] on an ongoing basis gave us opportunities to hear more about how other people understand our work.”

Shared resources (from equipment to expertise). If you need to get things done on the cheap, coworking spaces are the place to do it. Instead of shouldering the cost of office space, Wi-Fi, the coffee machine, copier and printer, you split the cost with the other members of your space. You can also leverage better prices for other equipment or subscriptions with group deals.

And then there are the human resources— the people that can be sourced for team projects and group ideas. Members benefit from classes and lectures given by fellow members at many coworking spaces. Alongside being able to seek out your neighbor by dropping by for a chat at his or her desk, you can also seek out formal channels of skills exchange at hosted events where members take turns giving classes.

Companies hiring from the available pool of freelancers is commonplace at Gangplank. “In Silicon Valley, the joke is that you can change your job without changing your parking space. We say at Gangplank that you can change your job without changing your desk,” says co-founder Jade Meskill. “We've had people who wanted to get out of the consulting business and work for a product company, and be hired directly by one of the other companies inside of Gangplank.”

The price is right. Jason Richelson, a former member of Hive at 55 says that coworking makes it easy to save money, especially for the entrepreneur just starting out his or her business and trying to reach a sustainable operational level. “You just don’t want to commit to a lease in the initial stages of a new company, so going month-to-month is the only way for startups. And with coworking you don’t need to think about furniture, Internet, printer, etc. because it is all there.”

Expansion opportunities and an impressive ROI. The expenses incurred (monthly dues and commuting expenses) are generally outweighed by the gains. In the first Global Coworking Survey held by Deskmag, 42 percent of coworkers said that their incomes increased since joining a coworking space— probably from having access to wider social and professional networks and securing better job opportunities.

The downsides:

Little privacy and too many distractions. Sometimes the nature of your work is not compatible with the openness needed to make coworking work. Lawyers or accountants with secretive clients, for example, may need their own private offices that can be secured at all times. Even coworking advocates are not immune to the distraction that comes with the free flow of people in a coworking space. Software developer and cloud computing expert Adam Lindsay, a member of Coworking Rochester, tells us that prospective members should be warned about potential distractions when considering a space, which can affect productivity or be stressful when you have too much on your plate on a certain day. “If a person is easily distracted, coworking might not always be good. Make sure the coworking environment has quiet spaces you can escape to.”

Not the right crowd. Sometimes the chemistry really doesn’t work out, between you and the rest of the coworkers in the space. You may have different expectations, and the coworking space just didn’t meet them.

::::: Genevieve DeGuzman is the co-author of ‘Working in the UnOffice: A Guide to Coworking for Indie Workers, Small Businesses, and Nonprofits’ (Night Owls Press, August 2011).

Reprinted with permission from an article by Genevieve DeGuzman The entire article originally appeared in Deskmag http://bit.ly/r34StT on 2011-10-21.

For more information about the services of Wyoming Entrepreneur, or to ask a question, call 1-800-348-5194, e-mail wsbdc@uwyo.edu or write 1000 East University Avenue, Department 3922, Laramie, WY 82071-3922. Additional help is available on our website www.wyomingentrepreneur.biz. The Wyoming Entrepreneur partnership program is funded in part through a cooperative agreement with the U.S. Small Business Administration. Additional support is provided by the Wyoming Business Council and the University of Wyoming.

Why Family Businesses are Special Today

Family-owned businesses are stable and optimistic, even in times of economic uncertainty. A recent national study by Kennesaw State University, the American Family Business Survey of family-owned businesses, studied the strengths, challenges and changes since a previous study done in 2002. It found that family business owners:
1 | Are optimistic about future growth - Even during some generally depressed business conditions, family business owners express optimism. Figures confirm that family businesses are better able to weather economic hardship and stabilize the economy than their non-family counterparts.
2 | Lack a sense of urgency about retirement and succession planning - Family businesses face some significant succession challenges. Over forty percent of business owners expect to retire in the next ten years, but many are less certain about retirement. Almost one third have no plans to retire, ever. Nearly another third report that retirement is eleven or more years away. This means that many owners plan to die running their business, which is not beneficial to their family, the business, its employees or its customers. Furthermore, nearly one third have no estate plan beyond a simple will.
3 | Select women as leaders - There has been an almost five-fold increase in the number of women leaders in family businesses in the last decade, far more than the increases seen in non-family businesses. The trend indicates that increased female leadership of family businesses should continue.
4 | Hold themselves and their employees to a higher ethical standard - Since family businesses are family and relationship oriented, they operate more ethically. Family owners have a major influence on their business and their values are emphasized in the business. Family orientation seems to translate into more ethical behavior and the resulting actions contribute significantly to their family’s identity in their communities.
5 | Expand on traditional management - There is a misconception that due to the relational nature of family businesses they are less professional. In one way this may be true, with only a few businesses having a written strategic plan or formal planning process. This is only one higher level of professional behavior. Despite the lack of formal strategic planning, they use other types of planning tools. Buy-sell agreements, business valuations, boards of directors, formal recruiting, performance appraisals, and benefits administration indicate their professionalism.
6 | More unified family values - Family unity and cohesion are critical to family business success and an important goal. Family members that agree on values, attitudes, and beliefs exhibit that unity and cohesion. The practice of these values result in increased levels of employee loyalty, commitment, and organizational citizenship. Similarity of values between family members in business and their customers can also improve relationships and foster economic stability.
7 | Place their trust in family members as key advisors – Overwhelmingly the business owner’s spouse is seen as their most trusted advisor, followed by their accountant, a business peer, parent, lawyer, and financial advisor.

With All of the Abilities of Social Media Are Websites Necessary?

Social media has exploded over the past several years.  In a listing dated August 17, 2011 showing the most popular websites, Facebook at number two is only topped by Google.  YouTube is third, Twitter ninth, Linkedin is 13th and WordPress 18th.  I’m pretty sure that our WyEn.biz isn’t in the top 1,000 and I guess that yours is not either.  So why maintain a website in the face of the barrage of social media?

The reason is simple.  Handling all of the options available to market your business on-line is a huge challenge.  Customers are faced with an absolute deluge of information and data, and if you want to help them, they need a central location to go to act on the interest that all of the social media efforts you may be doing has generated.  Social media is changing rapidly and social media sites come and go.  Your website can be a source of stability for both you and your customers.  Your website is where customers go when they want to get detailed information about your products and services.

Another reason to maintain your site is that YOU control the content.  Social media by its very nature is uncontrolled and you can present the story you want customers to read and address any problems on your terms.  This doesn’t mean that people won’t look you up and confirm your information on social media sites, but it does mean that in at least one area you can manage the discussion.
A final reason to keep your website is to avoid limitations.  Facebook, Linkedin and MySpace can all have e-commerce tools added in.  However, these tend to be limited in terms of layouts, size and content.  With your website, you can tell your story your way and be much more creative and unique.

In today’s world social media is a vital part of the marketing mix for any business, but don’t neglect your homebase – your website!

Are you using social media in conjunction with your website?  Have you decided to eliminate your website altogether?  If so how is it working?

Can you really prepare for the "what if's" in your business?

Disasters always happen to someone else, right? We hear about tornadoes, earthquakes, floods, but seldom take the time to prepare for dealing with our own catastrophes. But, they can and do happen, just when we think the road is clear sailing for our businesses and lives. I would like to share a story with you about an experience I had in dealing with the “what if’s”!

One hot July morning several years ago, it was “work as usual” in my family-owned print shop. We were concentrating on the week’s big project, printing a family history book that was due in just a few days.  Without warning, the skies opened with a Wyoming downpour, accompanied by one-inch hail. Amidst the din of the storm, a new, horrible sound erupted…creaking, crashing and screaming, followed by a streak of employees rushing out the front entrance. The rear of the 50’x100’ clear span, flat roofed, concrete block building had collapsed. The down spouts were blocked by ice and the roof had filled with water, like a swimming pool. Unable to bear the weight, the whole roof caved in, releasing a tidal wave that swept from the back of the building where our paper was stored, through the darkroom, pressroom, reception area…right on our heels as we raced for the front door.

How could we have planned ahead for such a disaster? Businesses that recover quickly from catastrophes are those that have planned in advance. Consider a proactive strategy for your company…before a disaster strikes.

    * Be aware…minimize the risk of damage in advance of an emergency by examining your structure and identifying potential issues. Although we thought we were prepared for a “normal” flood (all inventory was stored on shelves above the floor), we had no idea that the building was poorly constructed and wouldn’t handle a heavy load of water or snow.

    * Develop a plan for handling a disaster…communicate with your employees and develop good relationships with your competition. The positive attitudes of our employees were crucial in creating a team that worked to reopen the business quickly. Our competition, other local print shops, offered to complete our jobs to meet our critical deadlines!

    * Review your insurance plan…be certain that you have sufficient coverage to pay for indirect costs of a disaster, the disruption to your business, as well as the cost of repair or rebuilding. Our insurance company worked closely with us to find a new building, remodel it and hire a moving crew, making sure we were able to continue business with minimal disruption.

* Consider your key partners… including relationships with your lenders. Our business loan payment was due on the day of the disaster. Our banker assessed the situation and allowed us to take two months off from our regular payment schedule, to insure cash flow stayed positive during the rebuilding process.

    * Develop a disaster recovery plan…review all the components on a regular basis. Remember to consider fire safety and emergency preparedness measures, business continuation and building repair plans, along with your insurance program. Learn from others who’ve been through disasters! Take pictures of your premises, keep accurate inventory and note potential dangers.

Although a business would not choose to experience a disaster, preparation for the “what if’s” can build positive continuity strategies that will carry the business forward with greater strength, determination and teamwork.

How Do You Plan for a Sudden Loss of Leadership?

You usually don’t like to think about your final breaths here in this world, but with a family-owned business, along with grief, the subject arises sudden and unexpectedly – what do we do about vacant leadership in the business?  At some point following a tragedy, thoughts must focus back on the business.  What needs to be done?  Who will do it?  How and when will it get done?

We don’t want to think about the possibility of a sudden death, but unexpected things happen.  Like when my father suffered a debilitating stroke.  As surviving siblings those decisions needed to be made.  Our employees, customers and our father’s legacy depended on maintaining the operations of his manufacturing business.  Even before his death, bills needed to be paid, work needed to be completed, payroll had to be met and plans had to be made regarding where the business was going in the future.  Through careful planning, however, you can help your associates and family members cope with an unforeseen event of this nature.  You can protect and strengthen your business in the process. 

Annual strategic planning sessions which cover future business planning is an excellent opportunity to address leadership succession. Let’s look at three areas of leadership to consider in succession planning – leadership roles, successor selection and what it will take to survive.

Leadership Roles – What business functions does leadership perform?  If you or one of your key employees died, would anyone know where to pick up where they left off?  Are there written job descriptions for others to follow?  As an owner, consider your specific roles and responsibilities as the business manager.  Those might include – banking, budgeting, risk management, hiring, training, product development, as well as setting the direction and goals for the business.

Leadership Succession – Who will perform these duties?  After determining what the leaders do in your business, decide who will assume those duties if it becomes necessary.  Tasks and key responsibilities should be assigned to specific positions rather than to individuals.  Transition planning rarely goes smoothly when a company tries to replace leaders with individuals.  There is usually no such person who can fill their shoes.  My father was a master of invention.  Given a task to complete and some time to think about how it needed to work – he could do about anything mechanical with steel.  None of his successors had those skills. Skills such as planning, finance, banking relations, employee management, customer relations and operations could be managed by family members and the remaining employees. 

If you are the one in charge, chances are no one could replace you, either.  Family members might inherit ownership, but may not want to or be capable of handling the day-to-day operations of the business.  These tasks should be delegated to those who have the skills and abilities to perform them.  Others may take leadership in setting the overall direction for the company’s future. 

What Leadership Needs for Success – What is needed for the business to succeed?  Identify what each leader might need to perform the tasks ahead of them.  Heirs could potentially assume responsibility and control of the business without knowing everything you do, but consider training them now.  Survivors will certainly have financial concerns as well, so do some financial planning for the future.  Teach future owners how to make better financial decisions, resolve their differences and how to collaborate.  Head off issues with trusts, wills, shareholder agreements or buy-sell agreements.

Balance what the business needs with what the owners want from the business.  Balance the interests of both the owners and managers to head off potential problems and power struggles.  With regard to management, now is the time to identify and train individuals to take responsibility in short notice.  How would their roles change?  What skills would they need that the business could help them develop now, that would help it succeed?

Planning for leadership succession will be time-consuming and won’t be completed overnight, but it will be time well spent.

This blog post was written by Leonard Holler, Wyoming Entrepreneur Regional Director, CPA, CVA

Are You PROACTIVE or REACTIVE When It Comes To Exiting Your Business?

You might want to ask yourself this question before it’s too late.  There are two types of people in the world today.  Those that think proactively and those that just react and decide their course of action based on the situation at the time.  Proactive people look toward something they want to accomplish ahead of time and plan accordingly. 

One of the most important decisions that an entrepreneur will make, as a proactive business owner, is looking toward your exit strategy or succession plan.  You need to think about this in the beginning of your business because how you plan on exiting your business will have an impact on how you set it up and run it.  Do you want to pass the business on to your children or do you plan on selling it to a third party?  Businesses that demand a higher price when selling are usually not directly tied to an owner or key employee.  They don’t run themselves, but in most cases they have processes and procedures in place that allow them to operate without the owner’s personal attention to every detail.  If your plan is to pass the business on to another generation within the family, you will need to make sure that this family member or group of family members understands how the business operates by getting them involved in the business early.  This will give you an opportunity to develop their character and business management skills while learning the operations of the business. 

One thing is certain.  Someday you will exit your business.  Operating a successful business that provides you a living and a sense of security is not a guarantee that you will maximize its value when it is time for you to go.  Many business owners are skillful, hardworking, knowledgeable and in many cases very successful, but could not generate the value that their business deserved because they did not properly plan for their exit.  An exit plan will help you maximize the value for your company.  Since every business is different the plans will vary somewhat, yet most businesses exit plans will have certain common elements.  Most exit plans will include these elements: 

1) The transition of the business will take one of the following forms – sale to third party, sale to another owner, transfer to heirs or family members (during the owner’s life or at their death) or liquidation at closing.  The majority of businesses are sold or liquidated for one reason or another.  It is more difficult to pass a business on to family members successfully so that option requires even more thought and planning.  Selling the business to a third party usually offers the owner an opportunity to maximize the value received from the business.  Which option will you take?

2)  Determine the current value of your business and plan ahead to increase its value.  Make sure you get your business off to a good start by adequately capitalizing your business with equity and not debt.  Watch for opportunities to grow your business and pay attention to your market, customers, vendors and employees.  These relationships are critical to the development of a successful business.  Also, pay attention to the things that drive value in your business.  Measure your performance against those items.  Then plan your business to get the most out of it when it is time to sell.

3) Start educating yourself about how to maximize your cash flow and minimize your company’s risk.  Value is a product of cash flow and risk.  Understanding the complexities of cash management will pay off in the end.  Business value is all about cash flow and risk.  It is what drives the selling price of the business.  Cash flow is a measure of your ability to effectively manage your business.  With an eye on efficiency and shorter cash cycle, your business will be healthier.  Minimize risk by establishing processes and policies that eliminate or reduce risk.  Developing these practices will make your business more attractive to potential buyers.  Learn about how to improve your company’s cash flow and profitability with tools available at www.WyomingEntrepreneur.biz.

This blog post was written by Leonard Holler,  Wyoming Entrepreneur Regional Director, CPA, CVA.

They just opened a business incubator in Rawlins and I’ve seen these around the state. What types of businesses use them?

First, there are different kinds of business incubators often suited to the industry you are in.  For example, some focus on food, technology, manufacturing or retail operations and have equipment and space suited to those needs while others offer office space and services more suited for professional service industry companies.  They often pool resources, such as administrative staff, utilities, and equipment common to the incubator clients providing better facilities for their needs and for lower cost than if they went elsewhere. 

Beyond the facilities, incubators more importantly offer assistance to help businesses.  Start-up and emerging businesses are usually the most vulnerable and most likely to benefit from support and guidance incubators provide.  Common benefits for incubator clients include:

• One-on-one advising/business counseling:  Having extra help to ensure that the fundamentals are in place for a business to be successful can help make sure a business will be viable and profitable.  These fundamentals include assistance with marketing, financial planning, operations.  With proper assistance, individual business’ weaknesses can be discovered and remedies can be applied so that they won’t prohibit a business from being successful.
• Being held accountable:  Small early stage businesses they are only held accountable by themselves whereas incubator clients are required to report regularly to an advisory board where goals, problems, and progress is shared with others who can then provide corrective/suggestive action.
• Business Community Resources: By working with the business incubator staff and alongside other incubator businesses a business is part of an important support business network in their community ranging from financial resources to developing their workforce or even successful advertising methods.

In Wyoming we have a number of business incubators and the best method to find out if there is one near you is to contact your local economic development office, your local chamber of commerce or of course, contact us at Wyoming Entrepreneur as Wyoming Entrepreneur is closely involved with incubators in several of Wyoming’s communities.  If you are starting a business or are a home-based business ready to take the next step and would like some help along the way, moving into a business incubator might be the right thing for your business’ success.

Jim Drever