Client Corner: Solar-Fit
Learn about Florida Small Business Development Center (www.sbdcdaytona.com
) and Client Bill Gallagher from Solar-Fit
1. Bill launched Solar-Fit in 1975 in Holly Hill, Florida after having attended Embry-Riddle Aeronautical University Daytona Beach Campuswhere he studied aviation. His passion for the environment along with his background in engineering lead him to be an early solar energy user and advocate. Believe it or not, solar energy was very popular in the 1980’s due to a 40% tax credit offered to consumers by the government. Back then, Solar-Fit actually manufactured the solar systems on-site to fit each customers’ needs. Solar-Fit has been in business for 41 years, has 25 full time employees and is the oldest active solar contractor in the state of Florida.
2. Solar-Fit has been working with George Tewari and his team of consultants at the FSBDC atDaytona State College for 6 months thanks to Nick Conte from the City of Holly Hill recommending the FSBDC’s services to Bill. The FSBDC Daytona has helped Bill by providing an outsider’s perspective on his business and this has resulted in constructive feedback and recommendations to improve processes and grow profitability. Bill highly recommends FSBDC Daytona because every business needs someone from the outside to come in and bring fresh perspective and new ideas.
3. Bill’s entrepreneur advice is to make sure you have a game plan in mind before going into business. There’s a lot of surprises along the journey that are interesting and your plan will help you to navigate them while staying focused.
Client Corner- Oceans Dance Studio
Learn about Florida Small Business Development Center (www.sbdcdaytona.com) and Clients Branden and Stephanie Calnan from Oceans Dance Studio (www.oceansdancestudio.com):
1. Branden began teaching dance in the area in 2012 and Oceans Dance Studio was founded in 2013. Inspiration, combined with Branden’s back-ground in entrepreneurship having run a family farm and his own brewery and carpentry businesses led them to open the studio in downtown Daytona Beach. The reason they chose downtown Daytona is because of the significant foot traffic Branden realized while attending Embry-Riddle Aeronautical University Daytona Beach Campus as a student. The company has 2 full-time and 2 part-time employees.
2. Oceans Dance Studio has been working with George Tewari and his team of consultants at the FSBDC at Daytona State College since May 2016 after Stephanie did a Google search for “business assistance.” The FSBDC Daytona has helped Branden and Stephanie manage through a significant internal challenge, re-brand the company, pivot the business model and determine growth opportunities. Both Branden and Stephanie are very happy that George has been able to help point things out that they couldn’t see. They recommend other entrepreneurs contact FSBDC Daytona because you get to leverage someone who has already been there and done it.
3. Branden and Stephanie’s encouragement for other business owners is to design your business model around the activities that fulfill you and make a profit. Don’t let the customers completely drive your business otherwise you’ll always do that instead of what is really meaningful to you. In addition, be willing to give back because you’ll always receive more than you can imagine in return.
Client Corner- Dredging & Marine Consultants
Learn about Florida Small Business Development Center (www.SBDCDaytona.com) and client Shailesh Patel from Dredging & Marine Consultants (www.DMCES.com):
1. DMC has been in business for 14 years, has 4 offices in Florida with its headquarters in Port Orange and employs 10 people. DMC is a civil engineering and environmental consulting company with a focus on navigation and restoration dredging projects, water front development and structures such as boardwalks, docks, piers, marinas, ramps, shoreline protection and wave breaks. Some local projects they’ve worked on include 1,100 linear feet seawall at the Daytona Speedway, Riverside Park in Port Orange and the fishing pier structure under the Veteran’s Memorial Bridge on Orange Avenue.
2. Shailesh has been working with the FSBDC at Daytona State College for two years through the CEO Xchange program. He has also received assistance from George Tewari regarding how to better understand the implications of financial decisions, corporate culture and how to implement and bench-marking against competitors. Shailesh highly recommends other businesses to meet with the FSBDC Daytona team because you get to share information with like-minded individuals who provide a safe environment but hold you accountable.
3. Shailesh’s entrepreneur advice is to never be shy. Always ask questions if you don’t know how to do something or what it means. Also, have a good understanding of your numbers in your business and how to manage them. It’s important to know the difference between cash flow, sales, profits, payroll expenses, etc.
Client Corner – Drive Group, Ormond Beach
Learn about Florida Small Business Development Center (www.SBDCDaytona.com
) and Client Bill Payne from Drive Group, LLC
1. Drive Group LLC was started in 2005 by Bill Payne with a focus on providing web design, search engine optimization and online advertising services to companies large and small. Today, the company works with clients from all over the country from their office in Ormond Beach. Drive Group’s goal is to help you succeed in business through your website using measurable results.
2. Drive Group has been working with Van Canada and George Tewari from the FSBDC at Daytona State College since 2013. Van provided Bill the push he needed to expand his business and clarified what he needed to do to make it happen. This included helping Bill secure an intern from Daytona State College who still works for the company today. George helped Bill with improving workflow processes and refining the company’s value proposition with clear messaging. Bill highly recommends FSBDC Daytona because the assistance helped him recognize the areas where he actually needed help.
3. Bill encourages other entrepreneurs to fully understand the number of different hats you’ll be wearing when you get started. He recommends the book “Project Management for the Unofficial Project Manager” to help with bench-marking and identifying triggers for when things might be going south in your business.
3 MAKE-OR-BREAK QUESTIONS TO ANSWER BEFORE STARTING YOUR SMALL BUSINESS
Norm Brodsky, columnist for Inc. Magazine and serial entrepreneur, asks three questions before starting a business. Have you answered these yet?
1) Has the concept been around for 100 years?
While 100 is an exaggeration, the point he is trying to make is that he looks for an established concept because he says there is nothing more expensive than educating a market. Brodsky wants to run businesses that operate on an established concept so he doesn’t have to spend money on teaching customers what it is or how it works, etc. He says he would rather be in the largest most competitive market than have to educate his customers on the product concept.
Brodsky learned this lesson the hard way so you don’t have to. He owned a messenger business in the early ‘80s when companies delivered documents and packages by putting secretaries in taxis. No one had considered using an outside company for that task. Indeed, the secretaries even enjoyed their time out of the office. Educating his potential customers cost him so much, he’s unwilling to do it again.
2) Is the industry antiquated?
And by that he does not mean “old fashioned” or dying. He means an industry that is ripe for innovation because its companies have been doing the same thing for many years. Look for industries in which the customers’ needs have changed but the industry has yet to respond. Look for industries not utilizing the latest technology. Look for any situation in which a change has occurred and the industry hasn’t followed.
Brodsky uses his record storage business to illustrate this point. There was a time when the record storage industry was just that – a record storage warehouse where files stayed and were never accessed again. Then, because real estate prices had risen so sharply, companies began storing files that they needed to access from time to time so they wouldn’t have to pay high rent just to store files in their offices. However, much of the record storage industry was ignoring this change. Brodsky didn’t and his company grew strongly as a result.
3) Does the business occupy a niche?
The niche that you should occupy will likely be identified in considering question 2. If there is a need that an antiquated industry is not filling, that is by definition, a niche, and a profitable one at that.
Brodsky’s records storage business occupied that retrieval niche in an innovative, for the time, way. To keep his customers’ files near their offices so they could retrieve them quickly, yet avoid the high rent his customers were paying, Brodsky built up. He rented and purchased warehouses with higher ceilings so he could fit 150,000 boxes in 10,000 sq ft whereas his competitors could only fit 50,000 boxes in the same space.
Of course, these are not questions that a revolutionary company should consider if it really wants to blaze a trail and change the world. Those companies are few and far between. If you want to start and run a solidly successful business, however, take these questions to heart.
What Does Warren Buffet Think About Your Business
The Oracle of Omaha, Warren Buffett, is often hailed as the world’s greatest investor but he doesn’t think of himself that way. He will tell you he is not an investor or stock analyst; he is a business analyst and buys businesses.
What happens when we turn his analytic framework at your business? In a must-read book for all business owners, Robert Hagstrom reveals Buffett’s wisdom for evaluating businesses. One of the most famous is that Buffett requires the business to be simple and easy to understand or he will not buy it.
There are more and can be organized into four categories. We’ll focus on the most important items in the first three categories.
- Business Tenets
- Management Tenets
- Financial Tenets
- Market Tenets
Does the business have a consistent operating history?
Buffett likes businesses that have been consistent performers. If your business is in need of a turnaround, then Buffett won’t buy even if the industry is poised for growth. “Severe change and exceptional returns usually don’t mix,” he says.
Does the business have favorable long term prospects?
Buffett is much more likely to answer yes to this question if the business sells a product or service that 1) is needed or desired; 2) has no close substitute; and 3) is not regulated. Buffett likes these types of companies because it is easier for them to raise their prices without fear of losing market share or volume.
Is the management rational?
While most people think of themselves as rational actors, but science has shown us to often act irrationally. Some owners hoard cash far beyond what the company needs for a rainy day fund. Those companies slowly wither because the owner is not reinvesting in it for future success. Some owners siphon cash flow out of the company for personal use. Those companies slowly wither for the same reason. Buffett will not buy a business that has demonstrated irrational uses of its cash.
Is management candid with the shareholders?
Buffett says there is a difference between what laws and regulations require owners to disclose about publicly held companies and what responsible executive actually disclose to the public. Do you have the courage to discuss failure openly? If so, Buffett likes that about you. “The CEO who misleads others in public,” he says, “may eventually mislead himself in private.”
Does management resist the institutional imperative?
The institutional imperative exists when 1) a company resists change; 2) just as work expands to fill available time, corporate projects will materialize to soak up available funds; 3) yes men will support even foolish business cravings of their leader; and 4) the company begins to imitate its peers mindlessly in expansion, acquisition or other endeavors. Basically, if you make business decisions because you see other businesses doing something or are afraid to act differently than similar businesses, Buffett frowns on your actions because they do not lead to business success. Businesses must differentiate themselves from their competition, not imitate them.
Look for companies with high profit margins.
Buffett has little patience for owners who allow costs to escalate. Have you been keeping a watchful eye on the costs of the goods you sell? If not, they’ve been creeping up without you adjusting for them. Now you have less gross profit left over than three years ago with which to pay your overhead. If you’re wondering why your profitability has been slipping, this is one of the first places to look. If you continuously cut costs (without hampering the business’s ability to sell) and you price your product or service well, you’ll have healthy margins with which to pay overhead and maintain the health of the company.
These principles are not difficult to understand, in fact, they are quite ordinary. Above average results are often produced by doing ordinary things. The key is to do them exceptionally well. Implement these ideas in your business today. Transform it into something Warren Buffett would smile on.
From Good to Great
When it comes to running a small business, many challenges may be faced and must be overcome in order to achieve success. Whether you have been managing your business for years or are just stepping out into the business world, SBDC Daytona offers supplemental courses that will give you the skills to grow and maintain your business.
Why are these types of products and services important? Small business failure is primarily due to inexperienced management and undercapitalization. Having access to the best and most up-to-date business resources and management advice can make all the difference to the success of your company. Let SBDC Daytona’s team of certified professionals help advance your business and take it from “good” to “great.”