Marlin Steel business planning tips
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Marlin Steel business planning tips

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Based on a popular column by Marlin Steel President Drew Greenblatt on Inc.com

Based on a popular column by Marlin Steel President Drew Greenblatt on Inc.com

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Marlin Steel business planning tips Marlin Steel business planning tips Presentation Transcript

  • Marlin Steel Wire ProductsMarlin Steel Wire Products LLC 2013©
  • Six Tips for Creating a BudgetDrew Greenblatt, President, Marlin Steel Wire ProductsOne of the smartest people I’ve ever metis someone named Martin, whom I callmy real estate guru. One of the bestpieces of advice Martin ever gave mewas about crafting a business plan that’sable to absorb shocks to the system. Hisadvice also applies to setting budgets --and expectations.Inspired by Martin, what follows are siximportant steps to creating a budget:Marlin Steel Wire Products LLC 2013©
  • 1Craft a well-conceivedlist of assumptionsSpend most of your time here. This is where the heavythinking happens.What do I think the economy is going to do?Will I need additional help?What product lines are apt to grow?Which aren’t?What kind of raises should I give my employees?Marlin Steel Wire Products LLC 2013©
  • 2Lay these assumptionsinto three scenarios… a bad year, a good year and a great year.The purpose of this exercise isn’t just to create a game planfor all the bad things you could conjure up. It’s also toshape aspirations and to set high goals for the bestscenario you can envision.Marlin Steel Wire Products LLC 2013©
  • 3Use the conservative scenarioIt’s obvious why. You have to ensure that you can handlesurprises. Your assumptions shouldn’t be too optimistic.Even in good times, challenges arise that must bemanaged: a key employee retires or leaves for anotheropportunity. An important account goes away. Somethingaffects a relationship with a vendor.You’re more vulnerable when you overestimate positivesthat never arrive. Nevertheless, you’re trying to beaggressive as possible in order to grow your business andflourish.Marlin Steel Wire Products LLC 2013©
  • 4When you’re done, go back andreduce the revenues by 10%… Then increase the costs in your plan by 10%. Thiswas probably some of the best advice that Martinoffered. You’re going to face surprises along the way.A 10% cushion on both sides of the equation will helpyou through those.Marlin Steel Wire Products LLC 2013©
  • 5Create a balance sheet, an incomestatement and a cash-flow statementThey will help provide a full picture of your assets andliabilities, your financial operations and of the flow of cashin and out of the business. Some small businesses wronglyforgo this exercise, assuming they’re too tiny to bother.They shouldn’t suppose that. Plugging your assumptionsfor the coming year into a financial framework helpsvalidate them. It holds them to a higher standard. They’renot just pie in the sky.Marlin Steel Wire Products LLC 2013©
  • 6Review your assessments… Especially with your accountant and your trustedmentors. And it helps if you have a guru like Martin.* eBook based on a column by Marlin Steel President Drew Greenblatt on Inc.comMarlin Steel Wire Products LLC 2013©
  • Engineering Oriented / One-fifth of the Marlin Steel staff aredegreed mechanical engineersProduction Disciplined / We are ISO 9001: 2008 certifiedWorld Focused / We export to 36 countriesSafety Obsessed / 1,600+ straight days without an accidentMarlin Steel Wire Products LLC 2013©