Sample questions and answers
1. How about an accountant
Q. For our business, should we hire an accountant or should we keep it within the founders of the business. What did you do with your business?
Many thanks, Nicolas L., Golden Secondary High School, Golden, B.C.
A. Nicolas, Excellent question The accountant and bookkeeper is probably the most important part of the business second to the business plan and financial forecast. Depending on your current business and accounting structure, the way your current records are set-up, you may want to talk to a local accountant (that you may consider to hire) and ask for his opinion. He will be able to give you his advice and preferences on the record keeping set-up, as well as provide you with book keeping options, (Manual ledger - software etc.).
2. Strategic planning when starting a business
Q. What is the most important thing to remember when starting a business for the first time?
Murray M., Golden Secondary High School, Golden, B.C.
A.Great question, although quite vague, depending on where you are located, the type of business your considering, and the experience that you are bringing to the concept, the question may be answered in quite a few different ways.
A quick feasibility study, which will consist of some market and financial research, will give you some basic guidelines to start planning.
The feasibility will help you determine if you should proceed to the more detailed business planning process, which will eventually determine if the idea is sustainable.
In a rural area, the major question would be the demand, competition and if there is enough market to sustain the new business fulltime, part-time or as a hobby.
The same views would be required in larger centres, with more concentration on the competition, their weaknesses and strengths.
One good point to consider, If you are just creating a job for your self, the risk and time requirements has to be considered, in order to make sure it is worthwhile and that you are living the dream with long term benefits, either by way of quality of life, providing a necessary service and being profitable.
Please feel free to let me know in more detail your ideas so I can clarify some of the open ended answers or send me your contact information and we can discuss your specific business situation, I will in turn give you my thoughts on how to proceed.
3. Instructions - organizational chart
Q. On module 3, it says: Instructions - organizational chart, owner. Operators and job descriptions, Name or elders, coaches, mentors, counsellors... And we were wondering if we actually had to have names of people for these parts.
Rhea M., Chase Secondary School, Chase British Columbia.
A. No names are required at the beginning, although if you have people in mind, they may be recorded as still to be confirmed with their names etc. The organizational chart along with the job descriptions, will give the reader/writer a better feel of the requirements of the business process, whether it be as a support to your identified weaknesses, thus strengthening that portion or as the original planning process to get the job done. If your starting the business from scratch it will be hard to detail the job descriptions and may be revised as the positions and jobs are being defined. It would almost be like a work in progress, which is the same concept as the business planning process. The business plan is a living document to be used and amended as you move forward in the business, adjusting and changing procedures as necessary to become successful. This is where the advisers, elders, mentors, and coaches will be helpful to discuss the issues and come to consensus to the fine-tuning of your operation.
4. Instructions - organizational chart...more specific please
Q. So, what your saying is that we do not need the names right now but will need them later on in the future and that names were just to talk to those type a people who have the feel on how to do those jobs and get information.
Rhea M., Chase Secondary School, Chase British Columbia.
A. Your correct, but having a mentoring board or people to rely on to bounce ideas from is definitely a great business tool and a wonderful practice as your are beginning, growing or expanding your business. At a conference I recently attended, the speaker, I. H. Asper School of Business professor Robert Warren, quoted a study that from a survey of successful businesses "Over 90% indicated that they had either business mentors board / coaches or advisers on their team."
* A mentor is someone with more entrepreneurial business experience than you who serves as a trusted confidante over an extended period of time, usually free of charge.
* http://entrepreneurs.about.com/od/businessmentoring/a/valueofamentor.htm
Good luck with your project, and feel free to contact me if you have any more questions.
5. How about finding limited interest in our product?
Q. If our market related research comes up with findings that our product would have a small or non-existent customer base. How would we move forward with the business plan. This would take almost all meaning out of continuing, wouldn't it? We are in the process of researching and a concern is that we could find limited interest in our product.
Nicolas
A. This is such a great observation, and is precisely the reason that we want to do our mistakes on paper and not in real life. The idea that you had set forth and the realization of either being positive or negative is also known as a feasibility study / Business planning, Being able to analyse before too much capital/ money or energies are spent on a non-feasible project.
But don't worry as not all is in vain with the research you have done, take a look at what you have learned in the process, and look to see if any of your research have identified any other potential market or products that could replace the one that you were originally considering. Although most of the focus was on your original idea you may be able to convert some of that data to a useful purpose, or even better present your case as a success in the planning process as you have identified a potential problem and did not go forward with it and changed to your new idea.
Good luck with your project, and feel free to contact me if you have any more questions.
6. When do we need to generate an opening day balance sheet
Q. We are wondering if we need to generate an Opening Day Balance Sheet or one after 4 months of operation? thanks!
A. Great question!
In most circumstances, when presenting the financial positions of the start-up company, an opening balance sheet is expected. The major reason for this is to track all the financial activities of the company, giving the bankers/investors/partners a true picture of where the money is being spent and what categories. As you will notice after your first year of operation, the only connection the balance sheet has with the profit and loss statement is with the final outcome. Either an operating profit or loss was achieved, which will increase or decrease the equity portion of the balance sheet.
Good luck with your project, and feel free to contact me if you have any more questions.
7. How about the legal aspect
Q. Hi my name is Seane Printup, and I'm with the E-spirit team from Iqaluit. We are writing a business plan for a same day small package delivery courier service. Here are a few questions we hope you can answer:
- Are there any legal ramifications for our company if the package we are delivering an illegal substance or object? Obviously we don't know what the package contains.
- Do we need a contract explaining that if there is illegal stuff in the package we aren't liable.
- Are there any legal restrictions for transporting dangerous objects/substances(within the community only, we do not use aeroplanes) i.e: guns, gasoline, ammunition. ( We live in a hunting oriented community so it would not be unexpected).
A. This was a great question and a very important part of the business planning, identifying the risks of a business opportunity, and acknowledging the need of your clients. I had to call one of my contacts in the delivery business to get help with the question and this is what he stated: "all delivery companies get the shipper to complete a bill of lading, which describes what the content of the parcel is, and then depending on the content, the shipper must follow the rules as set out by the Federal Government, Transport Canada".
I have enclosed two links, which I found on the Canada Business Service Centre Site (CBSC) and through a Google search. This should help you fine tune your questions and concerns, as well as give you a contact for your Territory or Province for more detailed questions. One thing you will have to do prior to the set-up of your business is to get your lawyer to provide you with his legal opinion on the shipping procedures, as a prudent pre-caution in doing business.
I will also enclose the general CBSC link, which will also be a great site for some of your other business related questions.
http://www.cbsc.org/servlet/ContentServer?pagename=CBSC_FE/display&c=Regs&cid=1081944211274&lang=en
http://en.wikipedia.org/wiki/Bill of lading
http://www.canadabusiness.ca
Good luck with your project, and feel free to contact me if you have any more questions.