Business Success in 2020: It's About your State of Mind, Ability to Pivot & Financial Partners
The other day I started thinking more and more about the state of the economy and what makes today different from every other recessionary period we have experienced in the past 50 years. I remember in the late 70's, we were dealing with an oil shortage. Even though the economy was going through tough times, my recollection wasn't the same. I was a teenager then, and in the summer, we would get a bunch of friends together at 4 a.m. and head to our local gas station to gas up our parent's cars. Based on our license plate numbers and odd even day schedule, we would line up at the pumps. Our parents were thrilled we were all doing this because they didn't have to wait in those long lines and for us it was a blast. After a few hours in line and when our tanks were filled, we'd all go out for breakfast at the diner and then head home by 7 a.m. to catch a few hours of sleep before we'd meet up again at someone's house to hang out. After about a year of this ritual, gasoline just magically appeared and the recession was over. (Well that's not exactly accurate for everyone, but that is how I remember it.)
A few years after I graduated from college, I worked in N.Y. for a wholesale garment company, as a financial controller. The fashion and garment industries in the 1990's struggled. The buzz in the office was always about which one of the federated department stores was going to go out of business. There was a feeling of uncertainty for our jobs and the housing market was also struggling. Mortgage interest rates were over 10%. Department stores were requesting more markdown money and sales orders were not coming in as usual. The writing was on the walls, but the owner's of the business I was working for, waited too long to initiate the changes needed to weather the storm. They were forced to close their own doors. I had such great memories of that job, the owner's and my coworkers. I found myself unemployed, with a 12% mortgage interest rate and excited about the new opportunities this closed door gave me. I was mentally ready for a change and was offered a controller position less than a month later, for a specialty chemical business. I knew nothing about manufacturing, but I was willing to learn. My mind was open and my stress level was down.
Fast forward to today, after over 10 years of owning an accounting firm and many career opportunities, I have not forgotten those difficult periods of time or my state of mind during them. Recessions are cyclical and we may be in this one for some time. If you have not yet embraced changed and pivoted, it's time. This history lesson isn't going to be much different from the past recessionary ones, with the catalyst being the only difference. The future is currently uncertain, especially for small business owners, but your state of mind and willingness to pivot quickly is key. It is really a time of survival of the fittest and how you address it right now changes the ending of your story.
During the first round of PPP and EIDL funding in April, I compared it to what I thought it must have felt like during the Great Depression time, a run on the bank mentality. Small business owners were in a state of panic about submitting applications to their banks, before funds ran out. I was receiving calls and emails up until midnight that first weekend the application was released. You could feel the stress and concern everyone was feeling. All I kept thinking was some of these businesses will have to close their doors without these funds and SMA needs to help. It was a frustrating time and one that could have been avoided, if business had decided it was time to become financially healthy and heeded the warning signs being shouted for almost a year about a recession is on its way.
If what I have been discussing resonates with you and you are ready to change your state of mind and pivot, we are here to help. We are helping clients make informed financial decisions utilizing strong financial processes, strategy, accounting resources, client education and communication. This is not an overnight fix, but rather a process that works if you are open to change.
Here is an sample of our controller and accounting subscriptions meant for small businesses and a great fit for those:
Looking to understand their business financials
Needing formal processes
Needing better accounting / bookkeeping resources
Needing fractional controller assistance
Looking for assistance navigating financially
Wanting a monthly rate and plan
This monthly package includes the following:
Initial financial health checkup
2 - 1 hour monthly sessions with a SMA Controller who facilitates the strategy / education sessions
Financial Metrics / Scorecard
Monthly bookkeeping / accounting services
Controller oversight of the financial books with a designated staff accountant or bookkeeper on the team
Monthly financial reporting and review of related reports
Accurate Balance Sheet and assistance in clean up
Monthly mentoring to help you achieve a 10% net income return or better, 6 months cash in the bank, gross margin % related to your industry standards, assistance in budgeting, forecasting and pricing
SMA proven process and strategy
If you are interested in learning more about our accounting and controller product offerings, feel free to send an email to SMcCann@SMAProfessionals.com or call 1-908-888-2509.
At SMA, we wish everyone the best of health, both personally and financially,