RETAINING MILLENNIALS

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Retention is a difficult aspect of working with Millennials. According to a study by the Education Advisory Board, Millennials will change jobs up to 20 times in their career – a rate twice as high as Baby Boomers.  Millennials are also most open to starting their own business. The internet and social media have made it easier for Millennials to explore being entrepreneurs.

With Millennials turnover rate so high, it is important to understand what motivates them.

Here are some strategies to focus on retaining Millennials:

  • Millennials are status conscious and want to say they work for a well-respected organization. Develop a prestigious reputation for your business.
  • High performers like being in the spotlight and like the proof that they are doing a good job so give feedback often about how important their work is to the organization.
  • Millennials want to know they are wanted. Show an interest in their career path. Take the time to meet with them on a regular basis about how to meet their needs and wants.
  • Take the time to learn what motivates each team member individually and show concern for them as people, not employees.
  • Give Millennials opportunities to be entrepreneurs within your organization by allowing them to be creative and innovative.
  • Encourage them to join Young Professional groups through local Chambers of Commerce or other industry-related association.
  • Flexibility is the one thing Millennials want above all else! 45% of Millennials will choose workplace flexibility over pay. Traditional 9-to-5 model is restrictive with advances in technology. Being creative with scheduling will give your Millennial employees the strongest of reasons to stay with your company.
  • Millennials tend to be close to their families. Companies that include family members in their corporate culture carries a lot of weight with Millennials-they like being able to show off where they work.
  • Increase regular communication on performance. Millennials want constant feedback on their performance – written or oral.
  • Conduct open and honest exit interviews to identify the specific reason for the Millennial’s departure. Adjust your retention efforts based on what you learn.

CREATING SALES DURING RECOVERY

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(We are providing this article based on notes from a webinar we participated in from Next Level Strategies, LLC powered by Sales Xceleration on April 24,2020) We support their strategy for sales during this uncertain time and advise our clients to follow these steps.

Now is the time to build a bridge to your customers to move your mindset from “When Can I Sell Again” to “How Do I Sell Now”? Owners who accept the world is changed and adjust to the new way of doing business will be more successful. You need a new way of communicating with your customers to understand what is happening right now and how to pivot.

  • Understand Your Customer.
  • Determine as a team how you can help them (leaving your product/service outside the door)
  • Brainstorm on how your team can help
  •  Then, determine, what can your team do now? What’s reasonable? What’s quick?
  • What can you make money on?
  • What can people buy right now?

When salespeople are struggling to adapt to the new state of sales, as leaders we have to change our message, which will change their mindset. Instead of asking “How can we make a sale today?” or “How are you going to hit your numbers?”, we should be asking “How will our customers be different as a result of doing business with us?” or “What can we do today to help our clients?

Focus the conversation on how your product or service can benefit a prospect or client during this time. You want our sales team to focus on driving revenue that makes them proud when they make their sales calls.

Establish or learn how to better utilize a Customer Relationship Management System (CRM):

Business owners who don’t have visibility into their sales teams’ activities and pipeline are at a real disadvantage.

  • An online based CRM gives everyone access to the same information in real time.
  • It provides accountability of sales activity goals via connecting with Outlook or Gmail to easily track emails, calls, video demo’s, notes, etc.
  • It provides real time visibility of pipeline deals for future revenue, quotes being generated, deals closing, etc.
  • It organizes your sales team, so they never miss an opportunity or forgot to set a follow up for the next stage of the sales process.
  • It eliminates duplicate records and ensures territory and prospect lists are easily assigned.
  • It protects the business owner when salespeople turnover or workforce needs to be reduced.
  • You can quickly reassign a portfolio or lead list and easily see last activity date, conversation, etc. to pick right up where the last person left off.

Start or enforce weekly Sales Meetings:

A best practice is to have a sales meeting once a week, for one hour and have an Agenda so everyone comes prepared with their deliverables.

  • Agenda can include:
  • Quick Check In/Positive News – Focus on morale and have a positive start to the meeting
  • Headlines – Make it interactive by highlighting customer stories. What’s happening? What are customers saying? Keep the conversation focused on the customer’s world.
  • Training – How can we help our customer’s this week? Rotate salespeople each week to share a best practice.
  • Data Scorecard – Review the numbers including Pipeline/Deals Closed/Demo’s Scheduled/New Deals Quoted or Activity metrics (emails/calls),
  • Address the Issues – Identify, discuss and solve issues as a team
  • Reward and Recognition – Always end on a positive note.

How to prevent a revolving door of salespeople:

If turnover has been a problem in the past, you need to not only assess your hiring practices but also need to ensure you have a solid onboarding plan and the proper sales infrastructure to support the salesperson in achieving their goals. Without these sales process fundamentals in place, the sales team is likely to experience turnover. There is A player talent available on the market right now, so if you have a need for salespeople, now is a great time to look at upgrading your sales team talent.

Crisis Planning:

When a crisis hits, traditional sales strategies and methods must adapt. Can these businesses continue selling in a crisis? Yes, but probably not without new ways of operating in the new crisis environment. Leaders need to:

  • Identifying the type and scope of the crisis
  • Determining the likely duration of the crisis
  • Implementing changes to your Sales Plan as necessary (or create one if you don’t have one)
  • Communicate and motivate throughout the crisis
  • Refine your sales plan as necessary during the crisis period

Leadership Strategies to Implement Now:

  1. Overcommunicate – with employees / clients. Don’t be tone deaf and act like nothing’s happened but do it with empathy / compassion and show your team how you’ll move forward.
  2. Coach your Sales Reps – practice video calls, practice phone calls if they were previously used to face to face sales. Encourage using the phone, no one wants another email right now, but people want connection – leverage this opportunity.
  3. If you don’t have a way to forecast your sales, get one. Doesn’t need to be fancy but should give directional idea of what to expect. If you don’t have a CRM, get one.
  4. If you do have a CRM, it’s a good time to clean it up and make it work for you, instead of the other way around, optimize reports, get realistic about what deals will be delayed.
  5. Leverage the team to work on the company “Sales Plan” if you don’t have one. Look at sales goals and adjust accordingly to not lose motivation if quarterly and annual goals are slipping away.

Most companies have inefficiencies in their sales processes. You should position yourself now for the recovery by implementing the missing pieces of your Sales Plan now to ensure your stakeholders; employees, suppliers and customers continue viewing you as a leader in your field. So, I encourage you all to make the investment to put the right sales infrastructure in place to hire, train and grow your company sales.

In your Recovery Sales Plan, you should have clear goals/quotas, a compensation plan to incent the right behavior, a clearly defined and documented sales process, sales activity goals, a CRM to manage your customers and prospects, and of course your Pipeline and Key Performance Indicators. And a weekly Sales Meeting to keep your team informed, connected and motivated.

Leaders must take fear off the table! We have to lead our sales teams focus away from the internal dialogue of worry and fear and focus them outward on the customer. Don’t underestimate the power of having a “purpose” as this will keep your team focused on helping customers and drive revenue that makes them proud. The best way to increase value as leaders is to maintain positivity and have a solid sales strategy.

TACTICAL VS STRATEGIC APPROACH

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Tactical vs. Strategic. This is one of the challenges fractional CFOs have in educating their potential clients. Bookkeepers and accountants perform day to day transactions. This tactical role is meant to address the need for recording the company’s financial information. The fractional CFO is the strategist who studies the future of the company in order to help business owners understand, anticipate, prepare for and gain advantage from coming changes. We use foresight to describe what could happen in the future and in some cases, what should happen in the future based on industry trends and metrics.  Businesses have a lifecycle: start up, growth and reinvention.  If they become stagnant they will likely not make it. Fractional CFOs understand where their clients are in the lifecycle and present recommendations based on the business owner’s vision and goals.

What is the first thing a fractional CFO should do when starting an engagement with a new company? It’s not understanding current cash position or even the cash forecast. It’s understanding the client needs. Some business owners only want help with strategic plan analysis while others want hands on input on current financial statement strengths and weaknesses.  An experienced CFO understands that he or she must ask questions to identify the needs of clients. The standard checklist that a fractional CFO uses may not apply to all organizations because business owners have a variety of skill sets and needs.

In any new engagement, the CFO should obtain an understanding of the client’s current cash position and their cash forecasting.  The CFO should review the client’s policies and procedures. In order to bring the most value to each engagement, the CFO needs to understand what the client wants to get out of the relationship.  There is no such thing as a “standard agenda” or a “standard checklist.” Experienced CFOs understand the need to take a holistic approach to understand how businesses thrive regardless of the industry they are in. Working as a fractional CFO allows us to tailor our skillsets to best meet the needs of each client.

For more information about the fractional CFO role, please e-mail your questions to donna@rayburnbusinessstrategies.com.

What Causes Business Sales to Fizzle Before They Make it to the Closing Table

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We found this article does an excellent job of explaining the most common reasons we have experienced working with business buyers and sellers. Please contact us if you have questions about what you read below. donna@donnarayburncpa.com

By Tim Bellon | March 23, 2020

There is a sad fact about business sales that nobody wants to talk about. Most of the time, businesses that are listed for sale never make it to the closing table. As shocking as that may seem, even if you hire a business broker and do all the right things, circumstances outside of your control may doom your deal. This is why it’s important to work with someone that has the experience to take corrective actions before it’s too late.

Here are the biggest reasons businesses don’t sell.

Poor financial record keeping

Financial record-keeping is the scorecard of how well the business is doing. During the due diligence process, the buyer will examine these records to gain more confidence in their decision to move forward. In addition to other criteria, they will look to see if the business has enough cash flow to support a living wage for the new owner, the ability to repay the debt (for the business purchase), and a healthy profit to repay the downpayment and/or use for reinvestment. Having sloppy records breeds doubt and skepticism. If the buyer discovers an anomaly, they will dig deeper and ask questions about other line item expenses and their purpose. Once that happens, mistrust creeps in and it’s very difficult to recover.

Overpriced

Almost always, a seller will have unrealistic expectations of what their business is worth. However, a good broker will be able to explain market conditions, show industry comparable sales data and help price the business where it will sell. 

Lease transferability

Sellers should look at the details of their lease BEFORE they list their company. Here’s why: The lease should be able to be transferred to the new owner and release the previous owner from all liability. If this contract language does not exist, or an agreement can’t be made with the landlord, it will kill most deals.

Poor credit

Good intentions alone don’t get businesses sold. A competent business broker will qualify potential buyers and make sure they have the creditworthiness to get a business loan. Spending time with people that cannot follow through with the purchase is a waste of time.

Owner and the technician

Most small businesses start with an expert technician that goes out on their own and takes their chances with entrepreneurship. To build real value in a business, eventually, the owner has to turn their attention to being a CEO and leading employees. If the business only makes money when the owner does the technician work, it severely discounts the business’s worth and can make it unsellable.

No contracts

While customers love “no contracts,” buyers hate it. It’s because contracts give some guarantee that after the business is sold, revenue will still come in regularly and there is less chance of business disruption. Prudent business owners find a balance between providing customer flexibility and fixed agreements.

Unrealistic timing

It takes time to sell a business. Planning up to 3 years in advance leaves time to get systems in place and make other maneuvers that will maximize the business worth. Selling a business is not like selling a car. It’s a complicated transaction that will likely be the largest the seller will ever have in their lifetime.

Unwillingness for Seller to hold a note

Most sellers don’t realize that they may be asked to hold a note and extend terms to the buyer. The reason is, if the bank is giving a loan, they may want the seller to hold a note as well to mitigate the bank’s risk. While this is rarely good news for the seller, it is a reality in many  cases. Being inflexible on holding a note means that you will have to have an all-cash buyer, in the event bank lending is not possible, and those are fewer and harder to secure.

Lack of confidentiality

When a buyer (and seller) have a mutual interest in moving forward with a possible transaction, one of the first things to do is require the buyer to sign a nondisclosure agreement. This is the legal document that ensures that sensitive confidential information is not shared with any outside parties. This is important because if employees, competitors, or vendors find out that the business is being sold, it could cause disruptions that can be harmful to the business and of course, ruin the deal.

If you have questions about getting your business ready to sell or if you are running across these categories while attempting to purchase a business, please contact donna@donnarayburncpa.com.