Newsletter
Issue XII: Footsteps Along the Path
-A Newsletter by Clear Path Financial Education Services
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This
edition of Footsteps Along the Path was initially issued by Clear
Path Financial Education Services which has now become Kuehn
Financial Education Services LLC. For more information about
Kuehn Financial Education Services LLC, please email
Clear
Path Financial Education Services believes: In this issue: * Article: Risk Advice for the Self Employed * A Knowledgeable Consumer is Powerful * Clear Path in Action * Seminars Worth Your Time Risk Advice for the Self Employed Entrepreneurs consider themselves risk takers. Maverick spirits with the potential to excite the market place is the conjured image. The proverbial little guy or gal proclaiming, "take this job and shove it" to their boss while blazing out of a dingy cubicle and into the challenging world of self employment. Not to distract from the passion that is sustenance for growing businesses, but would it not be wiser to be a calculated risk taker? The 1996 movie, Jerry Maguire, illustrates taking an uncalculated risk. Maguire has an epiphany regarding his business philosophy. His mission statement results in the loss of his job. But, optimistically he proclaims the strength of his entrepreneurial vision while clutching a gold fish under one arm and boldly exclaiming to fellow colleagues, "who is coming with me?" Dorothy Boyd answers the call. She is motivated perhaps more by infatuation with Maguire than entrepreneurship. After all her first question is, "you will offer health insurance?" as they exit the office. Long movie, short ... Maguire and Boyd marry. To financially get by, they reside with Boyd's sister. Maguire's main source of motivation is his only client, Rod Tidwell's battle cry, "Show me the money!" Yes, after hitting bottom things worked out well in the end and Maguire's venture is a success. But, what would you expect ... this is Hollywood ... and this is what fuels the dreams of American innovativeness and free enterprise. How could the script be changed to show the character taking a calculated risk? The essence of planned risk is accurate and sufficient information. If you are self employed, is gut instinct the basis of decisions or is research? Also, business viability must be assessed. This goes beyond, "I have a great product/service so everyone will want it." Instead, key variables need to be addressed: a) Do you truly know your customer? Have you looked at demographic info? b) As a start up venture, do you have one year of reserve capital to operate your business? This does not mean enough funds to open the doors, but to truly meet the ongoing needs of an infant company. c) As an expanding company, are you knowledgeable of the economy and its impact on your particular industry? d) Do you know what is happening to your customers? In other words: Are tastes shifting? Is the unemployment rate impacting your key clientele? As your current client base ages are their wants changing ... do you plan on meeting these needs or attracting new customers to keep profits up? Some entrepreneurs overlook their exit strategy. This is part of risk taking. It determines how much money you want at what age and at what risk. It also guides an owner in business growth. The path you take depends on the destination. Do you want to sell your business to a competitor? Possibly, an expansive customer list or product development will be emphasized. Maybe, you want to work hard to create a profitable business to attract financiers. Facilities or systems may be the cornerstone of your company. Maguire does not create his business with all this in place. But, he does have a vital piece of it, the mission statement to guide him. Please take the time to develop a mission statement and business plan. It will enable you to share the foundation of your business with others in a concise and effective manner. The mission statement solidifies Maguire's dreams into reality. That is the power of well thought out ideas! Any life truly lived to its fullest, is a risky business. However, taking reckless and imprudent decision making out of your business will increase the life of your livelihood. A Knowledgeable Consumer is Powerful "Jobless recovery" and "productivity increase" are terms slathered over the media to describe our economy. What does this mean? How does it impact you? The theory is: Productivity gains are important to the economy. They allow the economy to grow quickly without setting off inflation. Also, productivity pumps up a company's profit because more product is produced without an increase in expense. Payroll is to be positively effected by higher productivity because as profits improve a company will hire. Is this what you see going on? The reality is: Inflation is on the rise as witnessed by increasing gas prices, mortgage rates, grocery, energy, and clothing costs. Also inflation is occurring without wage increases. As purchasing power declines folks will either buy less, injuring a very slow economic recovery, or they will go deeper into debt. The number one employer in Arizona is Wal-Mart. Recently, job hunters flocked to a new store. The average salary is $6.25, but this did not stop 8000 people vying for 525 positions. Therefore, low wage jobs will battle inflation causing a sharp decrease in a family's ability to purchase necessary items. Finally, companies are not hiring as predicted. Unemployment is at sustained high rates near 10 weeks in term. Please be aware, interest rates from credit cards to equity lines of credit will rise. Also, recalculate your budget to reflect changing costs. Know what variable expenses can be cut if need be. It is best to have an emergency cash fund of four to six months. Clear Path in Action * Clear Path recently launched its website www.clearpathservices.com. * For business tips to build upon this edition's information, please visit the Education Center's link http://www.clearpathservices.com/financial_topics/business_tips.htm. * An unprecedented way to educate during seminars is being developed by Debi Kuehn MBA. Material will be formatted in a comfortable environment based on contributions and experiences of the audience. * If you want to read more by Kuehn, please check out the monthly feature, Path to Achievement. Simply click here: Path to Achievement. Seminars Worth Your Time July 10: Path to a Financially Thriving Business 2:00 pm, Glendale Public Library, 5959 W. Brown St, Glendale RSVP at 623.930.3572 Are you master of your own destiny with visions of business prosperity, but financially struggling? Do you find it difficult to meet your personal expenses while expanding your business? Do you cringe at developing concrete financial goals with a strategy to reach them? Is debt draining your current cash flow? Do you know the exact service rate that will make your company profitable? Join Debi Kuehn MBA, owner of Clear Path Financial Education Services, for an interactive workshop exploring how revenue, profit, net income, cash flow and credit intermingle to create the reality of a moneymaking company. Learn what you need to consider before growing your business to the next level. This bottom-line approach to financial information will increase your net income! The workshop is excellent for start-ups, businesses on the edge of expansion and those strained monetarily. Deborah A. Kuehn is the owner, educator and consumer advocate of Clear Path Financial Education Services. Clear Path believes knowledge is power and prosperity. PH: 623-580-9293 
Written by Deborah A. Kuehn, MBA All rights reserved Clear Path Financial Education Services is a registered trade name Issue XII May 14, 2004 Back to Footsteps Along the Path List |
