20 Powerful Principles to boost your bottom line IMMEDIATELY

1. 20 Powerful Principles to boostyour bottom lineIMMEDIATELY By Bob Vitamante, SCORE Counselor and Chairman of Santa Barbara Chapter of SCORE

2. GOALS/Promises FOR TODAY(ambitious, risky, gutsy) • Learn insights to change how you: • View your business as the owner • Measure its success • Walk away with ideas to increase Your Bottom Line starting today

3. It’s okay to disagree!

4. You, the audience, will help dictate Direction & Scope • This will be interactive • Where are you in your personal business cycle • Stage of business: concept only? Starting? Running? • Employees • Goals: Have them? Are a beginning, not an ending. They will change over time. • Who are you? • Entrepreneur or Leader? Key manager? Sole worker?

5. First, a little about me Well known companies Not-so-well known companies RJ Vitamante & Associates TickerBuddy.com 3D Shopping.com Royal Cigar Society BAC Trading MLM’s: HUB (Humanity Unites Brilliance); Rexall Pharmaceuticals • SelectRemedy Temporaries • Pinkerton’s, Inc. • Olsten Temporary Services • Columbia Pictures Industries • KPMG, Peat Marwick CPA’s

6. Principle #1 Know thyself • Strengths • Weaknesses • Special skills & Talents • Passions • Likes • Dislikes Questions: Have you done a self assessment? Are you applying it in your business?

7. Principle #2 Know thy (Personal) Goals What are your personal goals for work or business • To lead or to follow? • To work alone or with others? • Inside or outside? • Creative expression? • Contribute to society? • Make a living for self and family? • Very little stress? Safety? • To build? • To get rich? By when?

8. Principle #3 Know thy (Business) Goals [aka Your Bottom Line] • What results do you want? • Must be specific • Must be actionable and measureable • Must be time bound • What is your business cycle - Daily? Weekly? Monthly? • Why? • What needs do you want fulfilled? If you don't know where you are going,you'll end up someplace else.Yogi Berra

9. Principle #3 (cont’d) Some Examples of Personal Bottom Lines: • A specific income stream/salary • A business expressing who you are, with money as a secondary concern • A sustainable business that can grow & build value • A ‘get rich quick’ technology play • A ‘fix it and sell it’ play • A business to grow and give to family members in one year, in three years, at some other future time • A business that does ‘good’ in the community

10. Principle #3 (cont’d) What’s your Personal Bottom Line? • For 2013 • For 2014 • 2020 • Beyond

11. Principle #4 Need Help figuring this out? Get a mentor! Who or What is a Mentor? Some History

12. Principle #4 Characteristics of a Mentor • Real life experience • Subject matter expertise • Demonstrated achievement • Cares about you and your growth • Objective, neutral • Honest and open, and knows their limits • Solution oriented • Can meet you where you are; been there, done that • 'Reduced ego' - Limited personal investment of 'self' • Big picture oriented

13. Advisor comparison guide

14. Principle #5 Follow your bliss • Know who you are and want to be • How does it fit with your skills, talents, passions, etc.

15. Principle #6 Be true to yourself

16. Principle #7 Define your role, realistically • Start at the top - Entrepreneur or Leader? • Dick and Mac McDonald • Worked hard and made a good living • Ray Croc • Bought the Franchise rights • Took little from the business • Hired the best • Creation, Production or Administration? • You need all of them!

17. Principle #8 Do the right thing, personally • What are you now doing that you should do: • More of? • Less of? • The ultimate test – what will move the business forward toward Your Bottom Line

18. Principle #9 Hang tough

19. Principle #10 Seek the truth (about performance), and it will set you free(financials have limited value for measuring achievement) Accountants may hate this! • Balance sheet (B/S) does not show true value • P/L ‘bottom line’ has very limited use • Doesn’t indicate earnings potential or sustainability • Is easily/readily misleading • Can create a false sense of calm or alarm • Can be useful with some important ‘tweaks’, but proper timely interpretation is a ‘must’ • Does not measure Your Bottom Line

20. Principle #10 (cont’d) (financials have limited value for measuring achievement) Some examples of financial data that can be misleading • B/S: • High or low cash balances or receivables • High or low customer deposits & trade payables • P/L: • Investments treated as expenses • Staff training • Addition of staff and Recruiting costs • New supplies and equipment • Advertising and PR programs • Timing for recurring expenses, such as insurance, workers comp, taxes, property taxes, incentive payments,

26. Principle #10 (cont’d) (financials have limited value for measuring achievement) Some cures begin with Proper analysis of B/S & P/L: • Cash is king: collect more frequently, pay less frequently • The trend is your friend: compare current period to prior months, prior year months, budget, competitors • Eliminate (or separate out) distorting items and owner’s compensation (in its full glory) • What to measure and when: key metrics • Identify items of continuing value in the context of your goals, and ‘suck it up’ • Increase income and reduce expenses – in a word, Negotiate • Create the story of your performance each period – explain what’s happening against ‘goals’

27. Principle #11 You can’t manage what you don’t measurePeter Drucker • Define Your Personal Bottom Line • Change your measures of success • Plan the necessary steps, such as: • Hire two sales persons • Purchase new equipment or software • Add X number of clients • Measure attainment of the plan

28. Principle #12 No man is an islandJohn Donne Who’s on your team? • Staff? • Family and Friends? • Professionals – CPA’s, Attorneys, etc.? • Mentors? • Board of Advisors? • Investors?

29. Principle #13 Put First things First • Crawl before you walk, walk before you run… • Develop your idea as a concept • Identify the things required to make it happen • Ask your mentor for advice

30. Principle #14 Focus, focus, focus • Daily question – are my activities today moving the ball forward • What you focus on will grow, positively or negatively • What am I avoiding – Deal with it. • Ask your mentor for advice

31. Principle #15 – Lead by example

32. Principle #16 The Team • The right skills for the right roles • Hire the best you can, and invest in them • Where do you fit in • What do you love and what do you hate • What will make the difference

33. Principle #17 Place a value on failure

34. Principle #18 A chain is only as good…

35. Principle #19 Alignment is a ‘must’

36. Principle #20 The Systems • Must have certain disciplines to enable repeat performance • Results must be tested • Spartan training • Demonstrated results

37. To Summarize Our focus today was on: • New, broader measures of success • Your role • Your business priorities • Your planning, goal setting, etc • Your staff • Your external team – Mentors

38. Thanks for your attentionGood Luck!