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However, if you are running a business, it
is imperative that you get a grasp on the
basic elements of your financial state-
ments and begin to build a simple
income, expense and cash-flow budget.
Once your budget is in place, be sure to
review it monthly so you will know
exactly when and where to make changes.
If building a budget seems too intimidat-
ing, then get a trusted friend or financial
advisor involved. A budget is an essential
tool to managing a successful business.
6. Develop a credit policy.
We are
amazed at how many distributors do not
have a written credit policy. One of the
most frequent reasons for losing cus-
tomers and salespeople is misunder-
standing payment requirements. The
best way to get past these uncomfortable
situations is to have a credit policy in
place and communicate it directly to
your customer before the order is placed.
All employees and salespeople should
know and understand the credit policy
so they can communicate it to the cus-
tomer. The best payment policy is get-
ting
cash
with orders because the promo-
tional products industry is a custom
industry and the merchandise being sold
cannot be resold. A credit policy should
include payment terms as well as conse-
quences for past-due payments.
5. Reevaluate your current commis-
sion structure.
The standard industry
commission split has traditionally been
50-50, where the company keeps 50 per-
cent of the margin and the salesperson
gets the other 50 percent. While many
business owners will balk at changing the
commission package for salespeople, a
proper policy will not only provide excel-
lent compensation to salespeople, but will
also motivate them to sell more, solidify
customer relationships and ensure that
the company will cover overhead expens-
es and prosper financially. The industry
SMALL BUSINESS
S 2014 COMES TO A CLOSE,
it is time to
reflect on the changes that need to be made to
achieve your goals in the New Year.
Typically, the No. 1 New Year’s resolution is to lose weight and be healthy, fol-
lowed closely by goals to get more organized. Although many New Year’s resolutions
are personal in nature, there are many simple changes you can make to improve the
health of your company and make your professional life easier, too. Here are the
issues our firm sees clients in the promotional products industry dealing with most
often. Count them among your resolutions to get your business fit in 2015.
7. Build and review a monthly budget.
The word “budget” is a scary word to
some business owners who are good salespeople but lack formal financial education.
COUNTDOWN
TO 2015
SEVEN BUSINESS RESOLUTIONS FOR A HEALTHY
NEW YEAR
JAMIE WATSON, CAS, BASI
A
DECEMBER 2014 •
PPB
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