At a recent panel discussion with other Twin Cities business advisors, Jen Verly, CPA, was asked about the top business mistakes that companies and owners make. The workshop was titled “Avoid the Avoidable” and was sponsored by UPSIZE Magazine with Club Entrepreneurship and held at the Minneapolis Club. The event was designed for business owners to ask questions of the panel and how to learn from others’ business missteps instead of taking them all yourself. You can read the full article from the January 2016 issue of UPSIZE Magazine online here.

 

Here are a few of Jen’s comments to help you grow a better business and avoid mistakes that can derail your success:

 

A big mistake I’ve seen is not having up-to-date financial information. It’s amazing how many [management] teams we meet with for first time who have been getting their information six months after the fact, three months after the fact. That equates to getting tax surprises—you don’t know what your bottom line is…and you owe a big dollar amount. Being surprised on cash flow makes for big issues in a company.
The second mistake I’ve seen is, not recognizing when it’s time to walk away from a project, or to close a location, which partially goes back to not having financial information. People say business isn’t personal. But when you own a business, there’s nothing more personal. It’s important to look at things from a purely financial perspective, not out of pride, but working with your team of advisers to say: ‘are we on track?’
A third mistake is being under-capitalized. That can deter you from taking opportunities. You can’t diversify and buy your own facility. And then not being able to expand your business based on customer demand. Down markets happen. And so not to be able to manage those hiccups—nobody wants to lay people off. So being prepared is important.
Another one that’s painful is not communicating to your professionals. Your team is there to help you. Just make sure your team knows each other: introduce your attorney, your accountant, your banker. We’re going to be able to service you better. Don’t call them after the fact, saying—oh I did this. I signed this agreement. Keep them in the loop.

 

Have a Question About Your Growing Business or Start-up?

If you have a growing company or are launching a new business idea as an entrepreneur, your team of outside advisors and professionals can be your greatest ally. They’ve worked with countless business owners of all kinds – and have first hand experience guiding them through common pitfalls and mistakes.

In addition, a good advisor can help you see things you may not be looking for – such as areas to improve your cash flow or ways you can better reduce your tax liability to keep your business successfully moving forward. If you have questions or would like a no-obligation discussion, please contact Jen Verly to see if our team of CPAs would be a good fit for your needs.


Photos and article content used with permission. All copyright and original rights reserved by Upsize Magazine.