Understanding how to lead is an important ability for a small business owner, particularly when it can be difficult to receive good small business advice. The simple fact is that of the 26 million small businesses (less than 500 employees) in the US, only six million have employees. Of that six million, approximately 60 percent have less than five employees. Knowing how to effectively lead, motivate and manage is critical, especially when every hand counts. In developing your own leadership strategy, keep these aspects in mind:

Setting Goals

In becoming a business leader, it is important to have set goals that can be measured.
Even something as common as training should have this same type of specified and measurable outcome, such as defining what success means, both for the team and the individual employee. By setting several smaller, attainable goals, every achievement will muster the confidence and morale of your staff, while every milestone provides a common focal point.

Ethics and Attitude

Developing a strategy toward business leadership also involves a high degree of courtesy? owning mistakes, apologizing for errors, keeping one’s word and giving as much as is asked. When business leaders incorporate these attributes, they set the pace for their respective teams. When employees see the business leader behaving the same every day, being just as courteous, just as level ?headed, just as hard working, they too will begin to adopt those traits. Setting this type of status quo should be a goal of any business leader.

Personal Involvement

Becoming a business leader also means retaining one’s stature. It is important not to be personally emotive; staff looks to the business leader to see how situations are to be managed effectively. It is important that the business leader’s personal life not interfere/intermingle with his professional life. When the business leader’s name is heard, it should invoke thoughts of what excellent work he does or what a good manager he is, not that he does the funniest impressions or that he offered the best marriage advice. In the same right, the business leader should never play party to personal attitudes that may arise.

Personal Agendas

When developing leadership strategies for a small business it is important to humbly represent the goals of the business, rather than personal agendas. Small business managers commonly have a tendency to manage more by personal inclination than business inclination, be it the selection of products to sell in a store or who gets compensated for drinks at a restaurant. Neither example represents the business as an entity. The good business manager examines sales, profit reports and market analysis to make those determinations.

Using small business coaching can help you navigate the turbulent waters of the marketplace through marketing advice, financial advice and business coaching in general to help make sure that you do not make the types of mistakes frequently made by new small businesses. Visit the training site of successful entrepreneurs at  www.helpingyouhelpyourself.com for advice on being active in determining your financial success.

When you have started your own business, you will always encounter information from one source or another telling you how to run it. This can be very confusing because you have just started out and may be willing to do what it takes to make your business work. One place that you can get good business advice is from other experienced business owners. These people have been there and can help nurture your business by giving you invaluable advice.

You can also learn a lot from them by just watching how they work and conduct their business.
Another great source of small business advice that can never fail you is the Internet. However, you have to learn to distinguish between good and bad advice. You will get advice from all corners of the world about how to run and manage your business. You should learn how to sift through the various opinions and find the advice that best suits your business.

There will always be an unending supply of books about small businesses. Go ahead, read these books and find new ways to make your business a success. You can also find ways to improve on various aspects of your day-to-day running of the business.

If all these options prove difficult for you, you can always seek the advice of a financial expert to guide you through establishing your business. You may have to cough up come money but it will be well worth it. A financial expert will look at your working capital and expenses. They will help you in making cutbacks in the various sections of your business. They can also teach you where to invest more money and how to manage your profits. Whichever business advice you choose, ensure that it is valuable because your business depends on it.

Sometimes through Online Counseling people don’t always “like” the advice they’re given.

This was the case with M., a 31 year old professional saleswoman who had a small high end sheep leather coats import company. M. had recently lost here dream contract in early 2008 doing ‘big business’ with a nationally known prestigious clothing store. Since that time she had moved around a bit job-wise and slowly gotten herself into debt.

At the time when I starting communicating with her she had reached the point where she was willing to work part time for others, in a commission only based job. She was currently four months behind on her rent and was exhibiting the beginning stages of clinical depression.

M. lived in New York City by herself, most of her friends and family lived overseas. She did have a few friends in the area but she hadn’t seen very much of them recently because in her own words: “What friends I do have here, I rarely see anymore as I have withdrawn into my apartment. A typical weekend for me will be to stay up all night Friday night only to sleep for the next two days consecutively until I have to return to work on Monday.”

Through our introductory Online Counseling session M. revealed that she was falling into a type of depression and having all sorts of strange dreams whilst sleeping (12-14 hours). She could not afford health care at this time and did not know what she was going to do financially. The weekend she had contacted me she had simply decided to discontinue eating and stated that she, “did not even feel that hungry anymore.” It was later revealed that she had also been engaging in other activities that pointed to sings of her Depression. She showed signs of drinking binges beyond socially acceptable standards; there were also some concerns about promiscuity (with one of her potential client).

I assessed that M.’s life was spiraling out of control and the things that provided her with a feeling of self worth i.e. her job, her apartment, her standard of living in general – were all dropping significantly. She was trying to get past these difficult times and just reached the point where she did not know what to do.

Three Online Counseling sessions were needed in order to formulate my assessment and professional advice; generally speaking, I appreciate someone who is having a true awareness about him / herself and wants to take the right steps – and she falls into this group.

I had the feeling that M. is having ‘an o.k. personality’ and therefore is capable of getting through the current situation, if major changes would occur in four domains:
A. Drinking should be a definite target for a change in her life.
B. Job and Business re-structuring: This economy has no room for many high end products; leather sheep coats are definitely within the heavily affected range. Use your sales ability, and move into another area. You are good in that line, so do high commission jobs.
C. Love / Sex / Relationships – no more and never again with clients or potential clients. Adopt therefore another mission: to look inward for your ‘self assets’ and thereafter outward, to find the right one.
D. New business location – no chance in NYC. Costs are too high and market trends are alarming. You are single, I told her, with no real supportive social circle around your location. Transform this “negative asset” into a big “plus” and move int to a growing areas, economy wise. Neither you nor I are going to produce miracles that would beat the economy trend. Since I’m not a magician, only a professional, I could see no reason to support an effort to swim against the stream when she could float on it instead.

So the strategy is:
- Look for another business and or job, elsewhere in the US.
- Establish a new ‘you’ – no drinking, financial responsibility and healthy relationships.

M. questioned me on the necessity to move out of New York; she was slightly agitated by my recommendation. Our Online Counseling work has ended; the Small Business Advice I could give her was left untouched.

Depending on whose stats you pay attention to, approximately 80% of small businesses fail within their first 5 years of  operation.

In many cases, its not that a particular business could not succeed; there just wasn’t sufficient time to figure out how to succeed.

Which brings us to the worst small business financing strategy ever.

Here’s how it work.

The would be entrepreneur develops what they believe to be a sure fire business plan that can’t fail.

Unable to locate any form of start up capital, they start their business with credit cards as the only source of financing, and an expectation of sustainable business results within 3 to 6 months.

If everything goes well, the debt will be retired within a year and funds will start building in the bank account.

Sounds Good, right?

I mean the thinking lines up perfectly with all the get rich quick business opportunities that exist on and off the internet today where some of them even try to convince you to use your credit cards because the opportunity is soooooooo good and can’t miss.

The problem is that every business can miss.

Every single one.

And the vast majority do fail.

Have you ever spoken to someone who runs a successful small business; perhaps one that’s been around for 10 to 20 years?

If you take the time to ask one of these entrepreneurs about their start up period, what you learn may shock you.

Even some of the most successful small and medium sized businesses out there today had some hairy moments making a go of it in the early years.

And some times the difficult early years lasted for several years.

The point here is simply this.

The process of getting a business operating and successful can take many unexpected twists and turns, no matter how diligent you are in creating a thorough business plan and business financing strategy.

Therefore, to increase your probability for success you need to allow for the unknown, the unplanned, and the unfair.

A business financing strategy that cannot accommodate unforeseen events is not much of a strategy.

A business financing strategy that is based on high interest credit cards that can destroy both your cash flow and your personal credit is also not much of a strategy.

To improve your odds of small business success, here are some tips for developing a solid business financing strategy.

>>> Invest Your Own Cash

If you have some of your own cash penciled into your business financing strategy, it will immediately increase your likelihood of getting some sort of start up loan.

The more “skin” you have in the game, the more interested a lender will be in approving your loan request.

There is also something to be said about the psychological incentive of losing your own money and the motivation it creates for you to work harder to keep it.

>>> Create Contingencies in Your Cash Flow

Whatever you estimate your working capital requirement to be, double it. At least increase it by a factor larger than 1.

Things can and will go wrong, so give yourself a fighting chance and develop a business financing strategy that allows for less than perfect results.

>>> Use Credit Cards Wisely

Used properly, credit cards can be the cheapest form of working capital that you have at your disposal.

Some business credit cards provide 40 days of interest free financing. If you pay off the entire balance every month, you have an extremely low cost of working capital financing.

But if you start carrying large balances without paying them down monthly, you will go from the cheapest source of working capital to one of the most expensive, and you will likely also destroy your credit rating in the process.

>>> Make Timely Government Remittances

Small businesses are by default tax collectors. And the taxes collected can sometimes wind up funding the business for longer periods of time than they were ever intended.

Using government remittances as a business financing strategy is basically a bad idea.

Government agencies that are assigned to collect from you have large budgets and enough broad sweeping authority to create plenty of grief for you if you are too slow in paying.

If you apply for a business loan while you have an overdue balance with a government tax agency, your loan request will likely be declined.

Even after the balance is paid up, you may have burned your bridge with the lender as a history of overdue government remittances can brand you as a bad credit risk.

>>> Watch Spending Closely At Startup

One of the things you can control early on is how much you spend and what you spend it on.

This is going to change in time, but if you can spend wisely in the beginning you may be able to avoid a cost cutting exercise further down the line.

While its normally true that you have to spend money to make money, you can still be smart about the spending process.

The value of having a Plan B should be familiar to most small business owners. However it seems that the concept of contingency planning is overlooked all too often with regard to commercial loans and working capital strategies.

One of the most entertaining and effective depictions of contingency planning can be witnessed in a movie called “Rare Birds”. This movie stars William Hurt and includes a particularly relevant line, “Always have a Plan B”, that is repeated several times. The movie should be seen by any business owner who doubts the importance of contingency plans.

The usefulness of a Plan B mentality is likely to be beneficial to many aspects of running a successful business. For various reasons, however, contingency planning appears to be under-utilized when business owners are seeking new working capital via business financing strategies such as commercial mortgages and business cash advances.

Contingency planning might be under-utilized when business owners are seeking commercial financing simply because business borrowers assume that there are not effective alternatives to the working capital financing they are seeking. As a result, many business owners might believe that it would not make sense to explore a contingency financing plan. A practical benefit of viewing the recommended movie is that it will become second nature to realize at times like this that businesses should “Always have a Plan B”.

Plan B contingency business financing can be viewed as insurance to protect a business owner in the event that something goes wrong with their working capital management. A few examples are provided below.

First, many small businesses have commercial loans that contain recall provisions that permit the lender to review the financing each year. With such terms, the lender can continue a business financing role for some borrowers and selectively eliminate what they consider to be marginal loans by exercising the recall clause. If they do, the borrower will need to pay off the entire loan or refinance within a limited period of time. The best solution for avoiding this possibility is to review current business loans and explore Plan B refinancing options if recall terms are included.

Second, a number of local banks throughout the United States have recently decided to pull the plug on future business financing. When they do so, very little advance notice has been provided in most instances. If a business has commercial loans or commercial mortgages with a regional or local lender, a Plan B should be developed for the contingency that alternative business loan arrangements could be needed in the near future.

Third, many providers for business cash advances are notorious for making unrealistic promises regarding the timing and terms for their financing. To prepare for this increasingly-common possibility, business owners should engage in thorough discussions with a working capital advance advisor before proceeding. Unlike the first two examples, in this case the Plan B approach must occur before financial arrangements are completed.

Fourth, many lenders for SBA financing, commercial mortgages and business opportunity loans are equally guilty of over-promising and under-delivering. This seems to occur disproportionately with local banks. Similar to the recommended business cash advance approach, commercial borrowers should pursue Plan B contingency financing. The ideal timing for discussing alternative commercial financing options is before committing to a specific lender.

”Always have a Plan B” is the connecting theme for the examples described above as well as other circumstances in which contingency planning is appropriate for business financing. The presence of a Plan B mentality is likely to contribute to many aspects of running a successful small business in addition to improving commercial loans.