Profitability Tune-Up Evaluation Workbook · 1. You must develop a reliable system for continuously attracting new qualified prospects to buy your products or services. 2. When you

© Copyright 2011, CMS, Inc. 1

Profitability Tune-Up™ Evaluation Workbook


The Profitability Tune-Up™ Business Evaluation Workbook

© 2011 by CMS, Inc.

All rights reserved. No part of this publication may be reproduced, transmitted, stored in an information retrieval system, or

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written permission of the publisher.

Workbook Published By:

Go Smart Publishing

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Suite 321

Arlington Heights, IL 60004

Phone: 877-232-0744

Email: [email protected]

Web: www.bizstarters.com

Go Smart Publishing is a division of CMS, Inc., a Illinois corporation.

Profitability Tune-Up is a trademark of CMS,Inc..

Virtual Incubator Coaching Network is a division of CMS, Inc.

“This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is

sold with the understanding that the publisher and author are not engaged in rendering legal, accounting, or other

professional services. If legal advice or other expert assistance is required, seek the services of a competent professional”.


Introduction

There is an old expression that “the best-laid plans of mice and men often go awry”. What this means in terms of your business management is that as critically important as it is to your business’s growth and vitality that you regularly review and revise your strategy, it is equally important that you have a reliable process for making your plans come to life. You will use the following tables to review how well you have crafted processes, systems and supplier relationships to effectively implement each and every part of your business growth strategy.


Module 1 Marketing Plan Update

You grow your business by selling more to your existing customers and regularly finding new customers to sell. You sometimes can lose sight of this simple but challenging process with the day-to-day demands of running your business. It is wise to take a bit of breather once a year to re-examine your strategy for finding customers and selling them, a process known as marketing. You should have received a separate Marketing Plan Update document via e-mail. 1. If you did, please open the e-mail, find the document and save it on your computer Desktop screen. 2. If you didn’t receive the Marketing Plan Update document, please contact us at [email protected].


Module 2 Sales & Marketing Management

There are two keys to continually growing your business in the most profitable fashion:

1. You must develop a reliable system for continuously attracting new qualified prospects to buy your

products or services.

2. When you land a customer, you must assure that you deliver the best possible customer service and

use this fond feeling for you to encourage your current customers to recommend to your business their

friends, co-workers, neighbors and relatives who have a problem you can solve.

Selling is a part of your overall marketing plan and the more effectively you use your company website,

e-mail marketing, networking and referral the less you must do what is thought of “full frontal selling”.

In this section, you will use the worksheets to evaluate the strength of each aspect of your current

marketing and selling plan.


Market Research The most successful business owners are those who are eternally curious about the business world around them locally as well as the greater business world out there. Use the following table, featuring a series of check-boxes and open space for writing, to evaluate your current process for staying up-to-date on your business intelligence.

Write an X in the check-box for every activity you currently undertake.

Market Research Activity Status of Use

Competitor Intelligence Gathering

I regularly read the selling copy on the websites for my main competitors.

Industry Information Gathering

I have set up Google Alerts for search phrases that match the services I offer.

I have put in Favorites a series of useful informational websites and I read them regularly.

Industry-Specific Training

In the past year, I have participated in at least one professional workshop.

Local Community Information Gathering :

At least once per month I attend a meeting of a local business group, chamber of commerce, etc.

My Research Team :

I have pulled together a group of individuals whose knowledge permits me to move my business ahead in “leaps and bounds”.


Selling For most businesses, marketing is the set of activities you use to draw appropriate potential customers (prospects) and repeat customers to your business rather than the business of a local competitor. Selling is the set of activities you do to either turn a prospect into a customer or to elicit and repeat purchase from an existing customer. As selling experts say: “Selling is where ‘the rubber meets the road’ in any business. Use the table below to evaluate your current selling system.


Selling Activity Status of Use

Sales Prospecting

I have developed a process for regularly identifying new prospects (mailings, etc).

Prospect Inquiry/Follow-Up

I use online and offline techniques to solicit questions and comments from prospective clients.

Customer/Prospect Education

I offer a FAQ section on my business website.

I send regular e-mail newsletters with useful information.

I present live or phone workshops.

Purchase Incentives

I make regular promotional offers (such as “refer a friend “discount, etc.).


Customer Service The power of marketing done correctly is that your company’s profits will explode by benefiting from the “2 R’s” – repeat sales and referral sales. Both “Rs” arise from having very happy customers – and by occasionally reminding them how happy they are! Use the table below to evaluate your current customer service system.


Customer Service Activity Status of Use

Making It Easy To Do Business With You

I accept both online credit card payments.

I offer online appointment-setting.

Customer Satisfaction

I incentive each new client to fill out an online satisfaction survey. And I use the results to improve our service.

We offer a pleasant in-office experience, particularly in the waiting area.

Frequent Buyer Rewards

I know how often each client has purchased service from us.

I offer frequent buyer rewards.

I regularly send “refer a friend” offers to existing clients.

Customer Referrals

I make it easy for current clients to refer friends, family, co-workers, etc. to our business.

I have an effective appointment reminder system in place.


Web and E-Mail Marketing – Part I It was surprising to see in a recent Entrepreneur magazine small business survey that more than 25% of the respondents still do not use a website to help market their business. A company website is the hub of any successful marketing strategy today. And, it’s also one of the least expensive. When someone feels that they are experiencing a health or other personal problem, chances are very large that their first step is to turn on their computer, bring up Google or Yahoo search and enter a series of words that describes the problem they want to solve. What they see next is a series of suggested websites with links to move the inquirer to the particular website. Obviously, if you’ve not launched a website for your company, it will never appear in one of these search listings. And, if you have launched a company website, but don’t know or haven’t thought about what search phrases people may use to find your kind of business in your specific geographic area, then your web address is not likely to ever appear in the magic “first ten” website suggestions. One of the most powerful marketing features of a website is the ability to give the website visitor, the recipient of your selling message, the ability to instantly communicate with you by filling out a simple web form and submitting it to you. By adding an incentive to this web form, such as a free report, free teleclass or free first appointment, you can motivate website visitors to give you their name and email address. Linking the web form to an e-mail marketing service, you can automatically capture the site visitor names and e-mail addresses and use them to send out a series of marketing communications right into the site visitor’s inbound e-mail box. And, the really wonderful aspect of using the website-email marketing combination is its low cost - $5 per month to host the website and $9 or so per month to run the e-mail service. Proceed to the next page to use the table to evaluate the strength of your current web and e-mail marketing system.


Web and E-Mail Marketing – Part II Use the table below to evaluate your current customer service system.


Web/Email Marketing Activity Status of Use

Search Engine Optimization (SEO)

I have a domain name that appropriately fits my business.

I include my domain name in all of my written and electronic communication.

I have a website up and running.

I have researched popular search phrases used to find my kind of business, particularly in my particular geographical area.

I am using these “key words” in the title of my website pages, in headlines and in major selling text.

Social Media

I have set up a business account and profile on Facebook.

I have set up a complete business profile on LinkedIn.

I have a free or for-free blog set up and I regularly write entries.

I have a full e-mail signature set up which includes links to Facebook, LinkedIn and my blog.


Web/Email Marketing Activity Status of Use E-mail Marketing

I have a functioning e-mail marketing account (such as Constant Contact or icontact).

I have selected one or more email templates and entered my company information for quick use.

I regularly collect new e-mail addresses and I send a weekly e-mail communication to my e-mail list.


Advertising & Public Relations For many small businesses conventional advertising in newspapers and via direct mail has been largely replaced by e-mail promotion, often due to the ease of use and relatively low cost to send each message. Some businesses, particularly those involved with personal care (such as beauty salons), home

improvement (such as landscaping) and restaurants, still participate in coupon pack mailings.

If your type of business does find traditional “ink on paper” advertising still profitable, we suggest that

you use the table and checkboxes below to evaluate how effectively you are managing your advertising.

Advertising Evaluation


Advertising Activity Status of Use

Print Advertising

I have a business relationship with an experienced local advertising copywriter.

I have had a local graphic designer create a “look” for our newspaper and/or direct mail advertisements.

I have contact names and phone numbers for an advertising rep at our local newspaper and use his advise when selecting size and timing of ad placements.

I tie our ad copy to our website to quickly gauge the level of response to each ad.

I know that advertising works best when repeated and I budget appropriate money to do this.


Advertising & Public Relations

Publicity is all about getting your business noticed through ways that don’t cost your company money.

While very cost-effective, there is trade-offs when you use publicity to build awareness of your business:

1. You can’t be assured that your publicity story will ever appear in print or online.

2. If your story isn’t published, you can’t be assured that some editor won’t alter your publicity story.

And, just like with a great ad, a great publicity story should most likely written by an experienced

copywriter, which will cost your company money.

Use the table below to evaluate your current use and effectiveness with your publicity.

Publicity Evaluation Write an X in the check-box for every activity you currently undertake.

Publicity Activity Status of Use

Press Kit

I have a biography of myself ready for use.

I have an appropriate digital photo of myself available for download off of our website.

I have a summary statement of what our business does ready for use (known as a “backgrounder”).

I have a list of 3 or more topics around which I can center a series of press stories.

I have a business connection with a local copywriter to help me compose a series of press stories.

I have created a spreadsheet listing the names, contact persons and contact e-mail addresses of media I wish to contact with my press stories.

I have developed a short “elevator pitch” to use when contacting radio and television producers to offer a publicity story.


Module 3 Financial Management

There are four key financial activities you must competently perform if your business is to grow in a sustainable manner. 1. You must be able to pay yourself an income that permits you to manage your personal/family budget. 2. You must be able to pay your vendors and service providers in full and on time. 3. You must be able pay all applicable taxes, once again in full and on time. 4. You must be able to create a fund of money to invest in growth-related activities, such as increasing the number of your employees, expanding your space, obtaining new equipment, entering into new joint ventures, et al. You will use the checklists in this module to evaluate your effectiveness in administering financial tasks.


Bookkeeping & Accounting Perhaps one of the most dramatic applications of small business technology has occurred in the area of maintaining the financial records of your business. The origination of the QuickBooks® accounting software program in the early 1990’s permitted a typical small business owner to maintain detailed financial records, with little or no accounting knowledge required. As the number of QuickBooks users has grow to thousands of business owners, so has grown a supporting network of bookkeepers who have been professionally trained in each and every aspect of the QuickBooks program. It is now possible to enter the name of almost any city in the U.S. into the search box on the Intuit website (the marketers of QuickBooks) and to find at least one QuickBooks certified bookkeeper in the local area. Use the checklist on the following page to evaluate your effectives in each of the bookkeeping and accounting tasks listed.


Bookkeeping/Accounting Evaluation Write an X in the check-box for every activity you currently undertake.

Bookkeeping/Accounting Activity Status of Use

Accounting Software

I have QuickBooks installed on my business computer.

I write checks off of the QuickBooks system.

At least once per month, I enter all financial information not already entered into QuickBooks, including: bank deposits, credit card charges and loan payments.

I keep all of my supporting documents in one place.

Accounting Professionals

I use a QuickBooks certified bookkeeper to complete my monthly accounting work.

I have a relationship with a local CPA.

Financial Statements

I produce and review a monthly profit and loss statement.

I use the QuickBooks program to create invoices.

Tax Planning & Preparation

I review tax planning advice from my local CPA.

I use my local CPA to assist in tax return preparation.


Budgeting, Cost Control & Cash Management It’s not enough to have a profit on each transaction when you are working to grow your business. You must also be effective at predicting when your business will need money invested in equipment, services, etc. And you need to be thrifty whenever assessing how best to commit your investment to get the greatest return on your investment. Use the checklist below to evaluate your effectives in budgeting, cost control and cash flow management.


Budgeting/Cash Management Activity Status of Use

Budgeting

At least once per quarter, I do a written projection of needed expenditures for my business.

Cost Control

I do comparison shopping before making any expenditure over $100.

I am careful in using volume discount so as to not build up too much inventory.

When needing the use of equipment I consider the cost of renting one time versus purchasing.


Budgeting/Cash Management Activity Status of Use

Cash Management

I know every day how much money is in my company checking account and the dollar amount of all business bills due at that time.

Each month I put aside some money from my business profit for future business needs, before paying myself.

I have an available business credit line with my local bank.

I use one personal or company credit card for all business purchases and use bonus points to buy necessary products.

I either collect client payment upon delivery of service or I promptly invoice the client.


Banking Relationship For many business owners, the only need they see for a business bank is to provide a checking account and hold the company’s money in the account. But, there are a number of ways in which your local business banker can be of assistance in growing your company.


Banking Activity Status of Use

Payment Options

If appropriate for my clients, I have used my bank’s help to set up a merchant’s credit card account.

Cash Management

I have set up an arrangement with my bank to permit me to move money from a money market account to the business checking account via a phone call.

Online Banking

I have set up and regularly use online access to my business checking account and/or loan account information.

I pay business bills via my online business account service.

Commercial Borrowing

I have a commercial loan set up for my business, or have inquired about the terms and conditions of setting one up.


Module 4 Business Operations

One of the most dramatic challenges you face in growing your business is how to maintain both your

profitability and outstanding customer service while completing a growing number of client transactions

each month.

The ability to maintain this “match” comes from building and running reliable operational systems.

Use the checklists on the following pages to assess your effectiveness in managing your business

operations.

You can also use your results in the checklists to assure that you are not duplicating effort in your

business operations.


Personnel & Purchasing

You may or may not employ anyone other than yourself as a traditional employee, but chances are very good that your business benefits from the expertise and efforts of other individuals. Use the checklist below to assess your current system of human support for the growth of your business.


Personnel/Purchasing Activity Status of Use

W-2 Employees

I currently employ one or more individuals in a traditional employment situation.

For each individual I employ, I given them a written description of their job responsibilities.

For each individual I employ, I have obtained and filed all necessary government and tax paperwork, including W-4 and W-9 forms.

For each individual I employ, I have given them a written description of their wage increase schedule.

As necessary, I invest in training for each employee.

Vendors

I have all necessary tax and contact information recorded for each vendor I use.

At least once per year, I review my pricing and payment terms with each vendor with an eye toward savings and more efficient work together.

Local Service Provider

I have relationships set up with needed local service providers, including: office supply store, graphic designer, computer repair person, copywriter, QuickBooks specialist.

I use discounts, coupons and other savings offers from local service providers whenever I can.


Administration & Legal Hopefully your legal needs are only occasional and not a regular requirement. But, when you want legal help you often want it quickly. Plus, almost every business must meet certain legal requirements. There are also other organizational and administrative requirements you must properly handle. Use the checklist below to assess your effectiveness in the legal and organizational administration of your company.


Administration/Legal Activity Status of Use

Legal

I have a relationship with a local small business attorney.

I am current on the legal registration of my company.

Where appropriate, I have professionally-prepared legal contracts for use with clients and/or suppliers.

Space Rental

If I am renting outside office space, I have a copy of my current lease and I am aware of the schedule for rent increases.

When necessary, I have spoken to my business landlord regarding any needed repairs/improvements to my space.


Business Technology

I regularly add new information to my company website.

I am using a late generation of all business software.

At least once per year, I examine my business phone costs and look at lower cost alternatives.

I have a relationship with a local computer repair person.

I regularly back-up all critical business data.


Inventory Control Some businesses are primarily product-selling enterprises and other businesses combine the selling of products and services. In either situation, the business may maintain some product inventory. Use the checklist below to assess your effectiveness in managing your product inventory.


Inventory Management Activity Status of Use

Inventory Control

I have a written system for keeping track of product inventory by item, including last cost and purchase terms.

I carefully balance quantity discounts with tying up excessive cash.

If my inventory becomes excessive, I make a special promotional offer to reduce the inventory level.

When receiving product, I have a system to match the receipt to the supplier invoice.

When I ship product, I have a reliable process for picking the product, packaging it, shipping it and tracking the shipment.

I have relationships with shippers that permit me to enjoy the lowest cost possible.


Insurance

Usually business insurance is a “once a year” review. But, many business owners fail to look at the breadth of their insurance needs when examining their insurance needs. Use the checklist below to assess your effectiveness in managing your business insurance.


Inventory Management Activity Status of Use

Insurance Coverage

I currently have in effect either appropriate homeowners insurance to cover my business assets or a separate business casualty and fire insurance policy in place.

I am covered by health insurance.

I am aware of any professional insurance required or strongly suggested for my specialty (such as errors and omissions insurance liability insurance).

Documents

Profitability Tune-Up Evaluation Workbook · 1. You must develop a reliable system for continuously attracting new qualified prospects to buy your products or services. 2. When you