Why Are Women-Owned Companies Smaller Than Men-Owned Companies?
Do you agree with the basis of this question? If you do, why is this the case? Read this interesting and insightful article from The Wall Street Journal if you are a woman business owner still trying to break through the $1m turnover glass ceiling. You may just discover the secret of how to do it. Read Article...
SELF FINANCING YOUR BUSINESS
The LORD will open the heavens, the storehouse of his bounty, to send rain on your land in season and to bless all the work of your hands. You will lend to many nations but will borrow from none. Deuteronomy 28:12
The most critical aspect of starting and growing a successful business is acquiring the necessary financing. A Biblical Entrepreneur has various options when considering how to finance a business; self financing, debt financing, or equity financing. Among these three options, God's best is self financing. Deuteronomy 28:1-2 states that if we diligently obey the voice of the Lord our God, to observe carefully all of His commandments which He commanded us, the Lord will set us high above all nations of the earth. And these blessings shall come upon us and overtake us because we obey the voice of the Lord our God. Among these blessings is the ability to be a lender to others and not a borrower. Although borrowing as a strategy to finance a business is not a sin, it does not represent God's best. God desires that His covenant people be in a position to not only experience debt free living and finance their businesses, but to be able to lend to others as well. Of course the Bible's definition of lending is not limited to the transfer of money or property with an expectation to receive it back with interest; the Bible also defines lending as giving. Psalm 112:5 states, "Good will come to him who is generous and lends freely, who conducts his affairs with justice." Proverbs 19:17 says "He who is kind to the poor lends to the LORD, and he will reward him for what he has done." In other words, part of the blessing for obedience is not only having all of our needs met but having enough to meet the needs of others.
What does it mean then to self finance? Self financing is using personal savings or investments as capital to start or grow a business. The advantage of this approach is that we are in bondage to no man. Remember whenever we borrow from others, we enter into temporary bondage. Self financing also allows us to be completely dependent on the Lord. Other types of financing may cause us to view who gave us the capital as our source rather than understanding that they are God's instruments and He is the source. The other advantage of self financing is we do not need to share the profits with anyone and we are free to operate the business without being bound to the input of others. The disadvantage is that we are using our own cash, which can have a negative effect on our cash flow. We should not be so determined to self finance that we put ourselves in a negative cash flow position. Rather, ask for and exercise wisdom as you consider the type of financing that the Lord would have you utilize. Remember, it does not matter where you start, what really matters is where you end. Knowing God's best, start where you are and trust Him to bring you to where you ought to be. If self financing is God's best, why is it that more Christians and Biblical Entrepreneurs do not self finance?
-Sin -we live in a fallen world and are all victims to Adam's sin. Sin is a conscious or unconscious violation of God's Word which causes us to suffer the consequences of disobedience, one of them being debt to others. Deuteronomy 28:44
-Bad stewardship -some of us, though we know better, have not exercised the discipline of proper stewardship. Bad stewardship is the mismanagement of the treasures that God has placed under our care.
-Lack of contentment - to be unsatisfied with what we have and attempting to start or grow our business ahead of God or beyond our ability.
-Presumption - proceeding to start or expand the business with arrogance, self confidence, and void of godly wisdom.
-Growth - the business evolving beyond our ability to finance it with our own resources. This problem is actually a good problem and may not be avoided no matter how well you prepare.
-Greed - an excessive and uncontrollable desire to acquire more material wealth and power than you need or deserve through the start or growth of the business.
Whatever your current circumstances, if you desire to experience God's best and allow HIM to provide your financing:
repent of any known sins in your life
exercise proper stewardship over your finances
be content with what you have
humble yourself under God's mighty hand
prepare for current and future growth by building a reserve
seek first the Kingdom of God rather than things
Do these things, be confident and watch the Lord bless your search for the right fundraising vehicle for your business.
Taken from the Biblical Entrepreneur Weekly Devotional byPatrice Tsague.
Plot a Course in Volatile Climates
By Stever Marr
The current economic volatility is placing tremendous pressure on all businesses and especially many small businesses. Waiting for the economy to stabilize next month may make you feel better, but it is unwise. The current volatile business environment is serious, and is likely to last for some time.
Each business leader needs to assess the situation and then take action. King Solomon wrote, “know well condition of your flocks and pay attention to your herds; for riches are not forever” (Proverbs 27:23-24) and today we need to give increased attention to our businesses.
First, make sure your finances are in good order. Many small business owners focus most of their energy on the income and expense figures, and forget about cash in hand. Cash is a valuable commodity that must be managed along with income and expenses. One contractor doing commercial remodeling was getting squeezed because customers were not paying on time, and he still needed to pay vendors. The contractor needed to look for ways to conserve cash and press customers for payment as agreed, while also looking for ways to conserve the cash he had available.
Second, look forward and determine what working capital will be required and how you will obtain those funds. New loans are very difficult to obtain and existing sources of cash are drying up. Some businesses have used cash reserves to tide them over the current difficult time, which leaves less funds available. Another contractor was financing jobs with an $80,000 credit card limit and the bank cut his credit limit to $1,500. Another businessperson was using a $250,000 home equity line of credit for short-term borrowing, but the bank canceled the line of credit. Today, managing cash available is as important as managing your income statement.
Third, focus on cost management in everything you do. Just plugging along may not be the best option. A furniture store was experiencing declining sales. They sold a truck used for delivery, raising some cash, and then rented a truck for making deliveries as needed. Overall the savings were 40% of delivery costs. A small manufacturing company had three employees quit, and instead of hiring three more people, they hired one full-time replacement and used a temporary staffing agency to fill in the work needs as required. Over the next year the estimated savings will be $40,000.
Fourth, rethink everything you are doing. Ask yourself honestly what is not working. Then find out why not and figure out how you can fix or eliminate what is not working. One restaurant found that Monday’s had very little business, so the decision was made to close on Monday. This saved a lot of staff costs and made a major impact on the bottom line.
Fifth, and finally, during difficult times you need to be on the lookout for growth opportunities. McDonald’s has advertised the dollar meals and offers less expensive coffees than Starbucks, and McDonald’s is one of the few restaurant chains posting actual sales growth. In Phoenix a homebuilder has targeted major home repairs and remodeling work in Sun City, where many of the homes have aged and many of the residents still have money to spend, thus creating an excellent business right in the middle of a very difficult time for construction.
Many business leaders are feeling immense pressure from customers, the economy, and competitors. As we battle every day, we need to grasp a tremendous truth from Scripture: “Thy commandments make me wiser then my enemies” (Psalm 119:98).
As we spend time reading Scripture and in prayer every day, we will gain insight from the Lord. When we are obedient to God’s Word, God’s insight will propel us to success in a very difficult market.
Keep Your Customers! Steve Marr
The current unsettled economic environment is creating more and more skittish customers. Patrons who have been previously content with their normal purchasing activities are now giving everything a second look. Many of your regular customers may now fall into one of these three categories:
- those that will look for less costly options when doing business with you - those who will start looking for less costly suppliers - those that will just stop buying all together
At this particular time your main focus should be on keeping the customers you already have. King Solomon advised, “Be sure you know the condition of your flocks, give careful attention to your heads; for riches do not endure forever…” (Proverbs 27:23-4 NIV). You need to pay close attention to your customers and make every effect to understand what they need and what they are willing to pay for.
Providing Alternatives
Restaurants may now consider offering lower cost alternatives like pasta dishes, less expensive cuts of meats, or lighter portions along with their staple offerings to give the more value-oriented customer a choice.
An office cleaning company began offering customers less frequent cleanings at a reduced price. When this less costly alternative was offered to one of its customers, they accepted the option rather than making the decision to do more of the cleaning themselves to save money.
Providing less expensive alternatives goes beyond just offering a cheaper version of the same thing; it is offering solid, value-orientated options for your customers.
Providing the Best Value
When under pressure some customers will be more inclined to accept competitive bids and check out other companies. In a past job position I took care of the purchasing in addition to other operational tasks. During an economic down turn I allocated more time to my purchasing duties by researching more cost-effective options. My research resulted in a change from some of our current suppliers, saving the owner of the business substantial money.
Lower cost suppliers may actually increase their opportunities in a tough market. For example, one company supplies replacement parts for mining equipment. During the boom in commodity prices many customers were inclined to automatically order from this original equipment manufacturer, placing their emphasis on fast delivery and a brand name.
However, during hard times, more customers were looking for an average savings of 15% an alternative supplier could provide. The alternate supplier actually began to increase their market shares and sales during the current slump.
Providing Incentives
Some customers just stop buying, or at least drastically reduce their spending when they feel economic pressures. Currently, more restaurant tables are empty, car lots are void of customers and clothing stores have fewer patrons as many decide they can do without the extras or the luxuries
Those who are severely pressured by the economic down turn probably cannot be enticed to buy. Others may be persuaded if you can clearly demonstrate certain benefits they find difficult to refuse.
For example, a dentist can explain the long-term consequences and costs of not treating a cavity. An oil change shop can remind potential customers of the repair costs that can present when routine maintenance is omitted.
Because your current customers are often your best prospects for new business, try bonuses like loyalty cards that offer a free meal after the customer has purchased ten meals, or offer greater discounts to businesses that purchase more volume or agree to long-term contracts.
Providing High Quality Service
Businesses must provide good value and high quality service especially in today’s environment. A deli near my house was struggling with slow business days. In order to cut costs they began using day old bread and some of their salads became a bit tired looking. As a result, a slow business became no business and the place soon closed. The Prophet Amos wrote warned about this, “selling even the sweepings with the wheat” (Amos 8:6 NIV). Customers simply will not tolerate poor quality or service.
Always remember to return calls promptly; getting back to everyone quickly is very important. I needed an electrical repair job done recently and I contacted by email a man named Frank, an excellent electrician I had used in the past, leaving three phone messages over a week’s time.
When I heard nothing back from Frank, I gave up and called someone else. When Frank finally did return my call, he told me he could sure use the work. I explained that when he did not call me back, I assumed he was not interested. While I could have waited a week for the work, I didn’t want to wait a week for his return call. Keep Your Focus
During this current economic challenge continue to focus with great respect on your current customers and treat them as you would desire to be treated at all times, not just during economic hardship. By offering less costly alternatives where possible, providing the best values, enticing with bonus incentives, and always keeping your quality of service high, you will have a greater percentage of your customers remain faithful to you and your company until the economic pendulum swings the other way once again.
Checklist for Leading Your Company Through Difficult Times
Fellowship of Companies for Christ International / Christ@Work
PILOT’S EMERGENCY CHECKLIST
CEO’s EMERGENCY CHECKLIST
First and Foremost - Fly the airplane.
It is your job to fly the plane. You have been trained to do this, and no one else can do what you have been so well prepared to do.
Maintain control. Don’t panic. Don’t “eject”.
Remember your training. Focus on what you need to do, not on the distractions around you.
Keep your eyes on your instruments. Use them to guide you, not your feelings. In particular, watch the instruments to maintain the correct attitude relative to the ground. Don’t trust your instincts to know up from down. Trust your instruments and follow your training.
Run the business.
God has put you in this place at this time (John 15.16). No one else is better to do this than you. He has equipped you to carry out His purpose in this circumstance, no matter how grim (Phil 4:13).
Focus on what you have:
· God’s promise of direction (Prov. 3:5-6) and wisdom (Jas. 1:5).
· God’s promise to provide for you (Phil 4:19, Jer. 17:7-8, Matt. 7:7-8, John 14:13, Is 41:10).
· The Spirit of power (2 Tim 1:7).
· The love of God (Rom 8:39)
You may feel alone and desperate, but God will not forsake you (Deut 31:6). He has you on the radar screen with a purpose to bring you safely to your destination. Don’t give up (Eph 4:30).
Do not rely on your feelings. Do not let your actions be swayed by the world around you. Rely on God’s Word. Trust God and follow His direction with trust and confidence in his love for you.
Evaluate the present situation and assess your resources.
· Check the fuel tank selector.
· Check your instruments, including fuel quantity.
· Check the engine conditions: temperature, oil pressure, RPM.
· Follow your checklist.
Ask the copilot to help.
Continue to fly the airplane.
Evaluate the present situation and assess your resources.
· First, check the most critical resources.
· Check the vital signs for your business: cash, inventory, orders, payables, receivables, and whatever the important factors are to your business.
· Know your situation for what it is.
· Analyze what you can control and what you cannot control, then with God’s guidance; determine what is important and focus on the things you can control.
Rally your management team and employees to help with the current needs (Prov 15:22).
Be courageous (Josh 1:9). Run the business under God’s direction.
Contact Air Traffic Control.
· Let them know your situation.
· Ask them for help.
· Listen to what they say.
Continue to fly the airplane.
Connect with God to get direction.
· Pray regularly and continuously. (Phil 4:6-7, Col 1:9-12, Matt 6:6).
· Study Scripture relevant to the situation.
· Seek wise counsel (Prov 11:14) from your FCCI group or other advisors who share a Christian Worldview.
· Listen – really listen -- to God’s voice speaking into your situation (Deut 30:20).
· Maintain a quiet heart.
Operate and control your business under God’s direction.
Develop a plan and take action.
· Determine the best strategy.
· Initiate the plan.
· Inform the passengers appropriately. Be honest and real. Prepare them for the ride.
· Prepare the cabin.
· Stay in control. An out-of-control airplane will crash.
Continue to fly the airplane. Maintain control all the way to the ground. Everyone can survive that way.
Figure out your next steps and take action.
· Prepare the plan and follow it.
· Serve one another as God has commanded us (John 13:34).
· Prepare the business for the turmoil and changes. Just waiting for business to pick up is unwise.
· Inform your employees and shareholders appropriately. Be honest and real. Prepare them for the ride.
· Stay in charge of the moment and business. Stay committed (Rom 12:10).
· Plan for survival. Don’t write an obituary or sing a dirge.
Continue to run the business. Maintain control as events turn, in spite of external pressures and forces (Rev 12:10, 1Pet 5:8). Everyone can survive that way (Ps 100:2, Phil 2:14).
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