Writing Concept Statement in Business

As a quick glance report, concept statement has been proved as a useful document in business management. It is defined as a brief verbal and/or graphical presentation made by one party to another in order to obtain approval or decision over the matter raised in such statement. Generally it is submitted in response to request made by the party that approves or decides. Salient points in writing a concept statement are explained below:

In keeping with brevity, a concept statement must not ordinarily exceed three pages. It can be intended to several types of receivers. Higher management requires concept statement to decide on a course of action; customers seek a statement that affords him best business terms; collaborators look for a statement that alludes on the advantages of doing business; service providers such as advertisement agencies need clarification of the purpose; finally someone else might look forward solve his own problem. Chief characteristics of concept statement includes: conciseness, to the point, of essence, unique in design and with lot of usefulness for all parties concerned.

Nobody can produce a concept statement by a magic wand or by the sleight of hands as card players do. A lot of handwork and conceptual thinking goes in, before writing a concept statement. Thereafter, it is reduced to black and white over and over to get the right copy in your hand. Here are the contents that must be included in a typical concept statement:

1. Introduction: Give background including reference to the person who requested concept statement; purpose intended to serve

2. Description: Summarize description in eye-catching words and paint a broad brush stroke of the uniqueness of the concepts contained in the statement

3. Benefits & Usefulness: Identify key benefits to the business; how it will play out in the near term and long terms, as regards to your own business, as against competitors and as a bulwark for the industry you are in. Point form of summary of usefulness functional departments must be given

4. Constraints & Limitations: Do not feel down-beaten about admitting any constraints envisaged as per the concept statement; inadequacies of the concept must be underlined along with any limitations that are imposed within or without in putting the concept into practice

5. Response: After ascertaining potential objections to the concept from inside the business, you must air your thoughts to alleviate doubts and fears emanating from the objecting quarters

6. Consequences: After examining potential uneasiness outside the business, you must say how you can neutralize it; you have to list the type of risks you have to face and how you will marginalize these; summarize the pot-holes and land-mines that lay in your path in implementing the concept statement

7. Probability of Success: Never live in a dream world and wish troubles, snags and failures fly away; never turn blind–eye to reality. Stay attuned to the fact that business is all about taking and managing risks and uncertainty. So tell the receiver of the statement what is the probability of success associated with this concept without going hyperbole or putting positive spin about it. Say frankly what you envisage as critical elements in putting concept statement into practice

8. Resources & Cost: List the human and physical resources you require in translating the concept statement into action steps. You also have to give a cost break-down in terms of finance

9. Time Span: The proposed implementation of the concept must be date-marked; you can do this in phases to facilitate identification of tasks and time duration

10. Responsibility: The person or persons in the case of team work, who are responsible, must be named

11. Reporting to: The person to whom the responsibility holders report to must be clearly stated and frequency and form of such report output must be underscored

12. Approval Sought: As the last point you must state the approval needed in clear and concise English.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How Conceptual Thinking Improves Business?

Behind every successful business stands a concept introduced and implemented by a person who employed conceptual thinking. In highly competitive business environment, it is conceptual thinking that provides much desired edge. Proof comes from social network media where Facebook, Twitter, Linkedin and so on are soaring in sales and revenue because each brought out a new concept that became instantly popular. Whether it is an existing business or a new one conceptual thinking can improve its prospects and performance.

1. It is all question of perception in the first place. When you are presented with a situation, conceptual thinking trains you to spot the missing link or information that is needed to solve a puzzle. You are not looking at facts and figures but for a hidden concept, a big picture, and a skill that marks you from others. You quickly read in-between lines and focus on a single aspect that can ultimately solve the issue and make your business a success

2. Flexibility is proven boon from conceptual thinking; your mind traverses from one point to another searching for a breakthrough. You think vertically and in the next moment laterally; use critical or reflective method of analysis; adopt structured or un-structured mode of approach; decide on the basis of deductive or inductive method of reasoning. The entire range of thinking and analytical styles is within easy range of a conceptual thinker

3. Configuration is a key benefit conceptual thinking affords to a business. A conceptual thinker can use abstract notion to be morphed into a concrete idea; likewise he can wade through in concrete measures to form an abstract principle. Aviation is the result of this combination; from Icarus who flew on wax wings to Wright Brothers who invented a flying machine, configuration has contributed to what we see as cosy planes today

4. Integrate and disintegrate is not only a mantra of the mathematicians but actively used for results by a conceptual thinker who has the ability to break a complex problem into small workable pieces. He goes on to understand the cause and effect and what must be done to get a sense of insight. This is referred to as mapping of concepts. By the same token, conceptual thinking can integrate parts into whole. Professor Gunapala Nanayakkara considers this as: “Holistic Thinking” where many un-related issues can be brought into a single all-embracing concept. A good example is framing a mission statement for a business entity

5. Delving into undelaying relationship is a key measure in conceptual thinking. Searching for new and existing elements, surveying individual elements, setting how these elements go for backward or forward integration, set patterns and trends in order to understand connection and relationship are some of the processes performed by a consummate conceptual thinker. More often than not, a conceptual thinker lands on a connection between the factors that was never perceived to exist previously. The evolution of various packing materials for milk, liquor, and drinks is a vivid example

6. Issue recognition is yet another feature of conceptual thinking that contributes immensely to a business. A conceptual thinker moves in tandem by listing all variables even checking on for un-fathomed ones, identifying important or critical variables and go deeper into find out how these could be examined to bring about resolution of a matter. Recent actions by air travel industry in solving unrest among air pilots is a good example

7. Solution is the final embodiment of success in a given business. Achieving solution requires finding out the common concept that is woven around different alternatives. For example, employee compensation can take various types of incentives hygienic to self-actualization. But the fact remains that attractive take-home salary is the common factor in any such alternatives. Framing a compensation package taking into considerations of competing and conciliatory challenges from management and employee unions would finally depend on a single conceptual anchor: corporate well-being. This concept acts as an over-awning arch and eggs on the employees, management, owners and other stakeholders of a business to select a compensation package that magnifies this concept and without any divisions, really.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Your MBA is as Good as your Dissertation

No mistake about it. You can do MBA anywhere in any school. If you have not done a dissertation as part of your study, there is no point flaunting your MBA to professionals in the field of business. Even if you have done one that cannot stand the rigorous test of academic standards, you would better keep your MBA out of sight from professionals in the field of business and academe.

Today, a plethora of MBA programmes are advertised globally. There is on-line MBA for a fraction of the fee levied by reputed universities. Some institutions offer MBA as a distance learning with or without requirement of a dissertation. Executive MBA is a programme offered for busy executives with duration of 6 to 9 months; such programmes at best require the candidate to file an executive report of some sort. We also spot programmes that award MBA degree after a lapse of 12, 15 or 18 months without insisting on any research paper. More than that, there are printing presses that can give you MBA certificate for a small fee. Such is the status of MBA programme today, it behoves parents and potential candidates do lot of search and thinking before embarking on a MBA programme.

Bet that as it may, having entered an acceptable MBA programme you should tally up the core subjects and electives/optional subjects and then zoom in on the type of dissertation the university or school requires. Some universities allocate 3 course credits or certain number of credit hours for a dissertation. If there are say 15 total course credits required then a dissertation is about 20 % of the entire study duration. As an easy way out, few schools land a single course credit on a dissertation and bring the total course credits to 12 or less. Normally, candidates tend to think about dissertation as an easy go where they can write some muck to pass the hurdle. They would be sorely disappointed. Every university or school applies strict evaluation yard stick in whetting such dissertations. Moreover, when a candidate who has handled dissertation with a kid glove goes out in the market in search of new job, elevation in present employment or placement elsewhere, he gets a slap on his face as he is often asked to furnish an abstract of the research done for his MBA.

A dissertation is defined as a “treatise written by a candidate in partial fulfilment of the requirements for a Master’s Degree in Business Administration, where an argument is presented, described and explained based on the findings of such candidate”. A well written MBA dissertation speaks of the excellence of the MBA programme one followed. Like proof of the pudding in the eating, a dissertation evidences that the author has done his homework well and deserves the degree of MBA. If you are signing up for a MBA programme be determined to do a well-researched dissertation. When you pass out as an MBA the professional and academic community would be in awe of you.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

Two Views on Business Development

There are two views of business development floating around in the market place. One relates business development as the functional view and as a sub-set of the marketing; other view speaks of it as the organizational growth process. Here are few points in support of both views:

Business Development as Function of Marketing

You come across number of high flyers who don visiting cards broadcasting as business development managers. The trend began with the boom in the IT industry and with dotcom revolution. Even today IT companies have specialised people handling marketing under the job name of business developer. Academic and professional organizations which are forbidden to use the word and title of marketing as a matter of courtesy and ethics open up business development divisions ostensibly to handle the same mundane function of sales and marketing. Hardly have we seen a new venture without a business developer prominent in their HR profile. So we have a situation where business development has been placed under marketing with a stated goal of bringing more business, customers and relationships. A new vocabulary consisting of such jargons and phrases as business pipeline, capture management, competitive intelligence, business leads and probability of winning bedazzles us more than ever.

Business Development as Organizational Growth Process

A macro view of identifying business development with as much new business as organizational wide growth process is slowly gaining currency in business and management literature. This view incorporates the following step-up approach, in defining business development:

1. Business Development brings in new relationship along with added sales growth

2. Existing relationships are milked more in order to improve business prospects

3. Building of strategic alliances is the cornerstone of any business development activity

4. Creating more opportunities for sales must reflect back on the organization whereby new products and processes are introduced to optimize such opportunities

5. Every growth opportunity is identified and analysed so that the optimum one yielding commensurate return for all functions in an organization is selected. Thereafter, proper strategies are formulated with a view to ensure seamless implementation

6. Business Development must aim for incremental rise in market activity that sustains the growth momentum in corporate management, marketing, HR, production/operation as well as in finance

7. Finally, business development must garner long term value by employing internal strengths to capitalize on external opportunities.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

Seven Styles of Thinking in Business

In a business there are several functions. Likewise those who man the functions have different style of thinking. There are seven such styles of thinking. Let me explain you each of these styles and to which function it relates:

1. Normal Thinking: This style refers to ordinary mental process encompassing, reasoning, visualizing, analysing, forecasting, journeying, jumping from one frame to another, shifting positions & focus and other activities to arrive at a conclusion. Most office workers, operatives and junior level employees possess normal thinking

2. Logical Thinking: Anchored on reasoning and driven by sense of focus on solving a problem at hand, logical thinking consciously seeks a solution or decision at a given moment. Every variable is subjected to scrutiny in logical thinking. At the same time their thoughts flow in an orderly fashion. There are two strands under this style:

2.1 Critical Thinking: This process involves high degree of analysis and evaluation to prove a point currently under examination. Criminal lawyers tend to display critical thinking strand

2.2 Reflective Thinking: On the other hand, reflective thinking seeks answers for phenomena that happened in the past, while adopting the same methodology of analysis and evaluation to arrive at conclusion. Once a conclusion emerges reflective thinkers apply that to the issue at hand. Civil lawyers tend to display reflective thinking strand

3. Vertical Thinking: This style of thinking moves on a vertical plane, sequentially analysing only known matters that too are selected beforehand. Vertical thinkers are also referred to as direct thinkers as they tend to focus on a matter directly without any sub-routing. More than that, they adjust their position only marginally as they proceed. Compliance, conformity and aversion to flexibility are their hallmarks. This style befits accountants, auditors and officers in finance department

4. Lateral Thinking: Founded by Edward De Bono, lateral thinking is just opposite of vertical thinking; it is alternately known as horizontal thinking or indirect thinking. Flexibility, experimenting are the chief characteristics of lateral thinkers. Striking the right balance between reasoning and creativity, logic and innovativeness is their forte. Lateral thinking generates ideas in quick succession, one of which could be selected in solving issues. Sales and marketing departments are full of lateral thinkers who add value to the business

5. Creative Thinking: Under this style, thoughts are fairly un-organised. Reason and logic are thrown overboard. In its stead there is imagination often running wild. If not corralled creative thinkers can turn to be fantasizers. But we must admit, these guys can move mountain with their ideas; they and their ideas in turn are celebrated. Internet is a lively example of creative thinking. Ideas and pictures come in quick succession to a creative thinker who can fashion a new product or find a new way of using an existing product. Though creative thinking is often spontaneous, it can be egged on by direction and guidance. Brain storming is a good example of the latter method. Departments dealing in design, fashion, lay-out, PR, advertisement, corporate communication are manned by creative thinkers.

6. Structured Thinking: In business life, you bump into someone who uses step-by-step approach in handling matters. He goes through methodical system of study, listen, observe, collate, reflect and thereafter make his pronouncements known. Here is a structured thinker, who combines both vertical thinking and horizontal thinking in equal measure but move cautiously and sequentially from unknown to known realm. At a given moment their thinking process involves problem definition, listing of underlying causes, assessing impact, generating alternatives and finally choosing the ones that optimize the interest of a business. Engineers, operation managers and those work in research and development departments are possessed with this style of thinking

7. Conceptual Thinking: As the odd man out of the seven styles of thinking, conceptual thinker is not concerned with facts or pictures, but with concepts. He has the ability to break a complex problem into small workable pieces. He goes on to understand the cause and effect and what must be done to bring normalcy. Afterwards, he builds concepts around the problem quickly and with ease; maps the relationship that lie between each concept, makes useful assumptions, validates the assumptions; fuses the concepts into a framework; arrives at a solution or decision; finally makes his point known in concise and precise manner. A man in his elements, he is the quintessential business developer, corporate strategist and on elevation chairman of a board.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

Eight Types of Business Research

Every business undertakes research so that it can take right decisions at the right time. No matter what kind of business you are in, you are expected to find out something out there that impacts running of your business. Here are eight types of business research you will have to do at some stage in your business career:

1. Exploratory: This type of research arises when you are entering into un-chartered area. A pretty good example is when you are asked to explore the possibility of opening a branch of your company abroad. At present you have no research findings with you. Neither you are familiar with the territory. So you begin to work from general point to a specific focus of your company. You have to marshal facts from many sources, collate these and familiarize with the situation there. Thorny issue must be identified and you need to find out every angle of opening a branch in terms of qualitative and quantitative data. Afterwards, you develop hypotheses that can be tested. Sometimes it so happens that you find opening such a branch is just no-go

2. Descriptive: Most business research harp on describing the facts as it is. A good example is to see how your present business location helps in developing your business. You identify variables and rank these in order of their importance in impacting your business growth. You cannot leave a single stone un-turned. After listing every conceivable variable you file up your report. At the risk of repetition, I must state that these variables are known and exist as it is. What differs is your ranking of the facts and/or level of their impact. Since there is no originality involved we often call this research as “Ex Post Facto”

3. Evaluative: This type of research is also known as “ analytical”, due to the fact that you are expected to do lot more analysis. In evaluative research you have full freedom to bring in variables that was not known previously. A doable example is to analyse the present office lay-out in overall efficiency. You still use existing data, but you can bring a new factor to evaluate it. In addition to factors already in use such as convenience, seamless integration, process flow, traffic flow, lighting & ventilation, natural setting, you can also bring in ergonomics and aesthetics to evaluate the office lay-out. In evaluative research you are expected to air constructive criticism of the subject matter so that the management can make considered judgement or informed decision on the basis of your findings

4. Diagnostic: Though sounds more of clinical nature, diagnostic research is often undertaken in business areas to solve chronic issues that remain unsolved for quite some time. One example is employee absenteeism. In this type of research, you are both an insider and outsider. You have to be passionate in solving the issue and at the same time display a sense of neutrality. This is because you are handling sensitive matter of employees and even more discreet matter such as absenteeism. You approach this assignment with open mind and seek to get in-depth knowledge by identifying symptoms, causes and effect. You will distinguish between chaff and grain, symptoms and causes, under-lying reasons and obvious explanations. Your data gathering must be discreet and borders on confidentiality. In most cases you will select a sample from a large group or work on selected employees of a critical department

5. Investigative: A minuscule version of a diagnostic research, this type narrows down the field of inquiry to a specific factor or phenomenon. An apt example is carelessness of an employee that caused a fire in the factory. You are expected to survey the factory, understand the cause, identify the party involved, and file evidence against such an employee. You will assess the cost of damage, obtain explanation from the party concerned, and ascertain the extent of contributory negligence on the part of management. You will conclude with what action to be taken against the party concerned and what steps to be taken to avoid such accidents in future

6. Normative: This is completely different research from the previous ones. Here you study and analyse issues to set norms, standards or parameters. Often these are expressed in quantitative forms. Where qualitative form is selected norms would tend to be general requirements or maxims. Norms can range from broader aspects such as values and characteristics to narrow aspects of eligibility. Setting accounting and auditing standards in a business is a perfect example of a normative research

7. Predictive: This research type is also known as causal research as it sets out to trace the cause and effect of a phenomenon. In business, predictive research can take the form of “If----When “scenarios. Basically a predictive research indicates the set of results when a particular cause takes place. Predicting such results have nothing to do with soothsaying but anchored on the scientific method of testing a hypothesis. Loosening credit control leading to pile of bad debts is a tested example of predictive research

8. Prescriptive: A prescriptive research is based on designing a specific solution to a known issue. Generally such a known issue emanates from the gap between what is desired and what is currently available. A business researcher embarks on doing this, after examining the relevant data and variables that impact and influence the situation; after critically evaluating the business as a whole; after exhausting all other possibilities of solutions that are found in available literature. Hence, a prescriptive research is the most original in terms of outcome. Designing an organizational system is a fitting example of a prescriptive research.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

How to generate Business Ideas?

Enthusiasm has no limits when it comes to talk about ideas. Oftentimes, you bump across the guy who says to you “Listen, I have an idea”. Depending on the circumstances you are in generating ideas can be quick or time consuming. During an emergency everybody starts thinking and an excellent workable idea pops out. But in the case of family, business, educational pursuits, sports, military ventures and political manoeuvring, creating the right idea is time consuming. There are seven ways in which you can generate successful ideas that work in most of the fields. As a business adviser I give pride of place to generating business ideas:

1. Reflective Thinking: This is the fountain that springs most successful ideas in business, technology and activities that border on the profit motive. In reflective thinking you regurgitate like a cow in the gate, of what you have learned, what you have heard and what you have felt. You marshal these facts of wisdom; re-visit these and make connections between you and the facts gathered. Thereafter, you examine the facts, correct the errors tie the loose-ends and embark on the journey of re-learning. You fuse many limbs of the idea into a cohesive whole and arrive at a business idea that has the potential to be turned into a practical and successful one

2. Studied imagination: I rate this process as the second most important way to generate good business ideas. In this process you enmesh both subjectivity and objective analysis. What you have studied in college, business and family relationship is your objective part which you will weld with imagination that flies out to realm of un-fathomed areas. Icarus saw how birds fly and fitted him with wings made of wax he soared over the sky. For his bad time he came close to the Sun which resulted in the melting of the wings. Consequently, he started to fall. You are not going to repeat this. Instead, you will steer your imagination backed by your objective facts could easily land in a workable business idea

3. Bright Sparks: Unlike studied imagination bright sparks give you an idea all of a sudden. It may be related to the circumstance you are in or something un-related but connected to your circumstance. Archimedes found his theory of floating body after immersing in the water tub. His theory ran thus: any object, wholly or partially immersed in a fluid, is buoyed up by a force equal to the weight of the fluid displaced by the object. This theory has worked wonders in business applications

4. Observing Nature: Newton found his theory of gravity after observing the fall of apple from the tree. Natural phenomenon has objective lessons for you. Scriptures talk about this as a measure of reward or punishment from the God. Naturalists think otherwise. They opine that these phenomena are result of cause and effect which were later tested in science and arts. By observing nature, business persons have fashioned ventures from food to outer space-physics

5. Your Experience: As you agree with me, experience is a better teacher. Your track experience in a chosen career can give you plenty of ideas whose success rate is much higher than the ones your green horn colleague boasts about. A seasoned person with plenty of experience and insight generates quick and workable ideas than MBA graduates because he prefers to err on the side of caution rather than jump head along into a hole of fire

6. Brainstorming: It is not necessary that you should do a brainstorm session in a class room setting to get brilliant ideas. When you meet up with friends, colleagues and family members make it a point to talk about new idea for a business. Allow them to speak their heart out. Never interrupt. Garner points and trends. Now you do your own calculus picking one point here one trend there and bring together to get a raw idea. After refinement and faceting you will end up having a remarkable one. Call it gold mine

7. Recycling Ideas: For want of better expression, I am using the phrase recycling ideas. in fact you are borrowing it lock, stock and barrel. Lest you are accused of plagiarism or indicted for copyright violations you calibrate the idea; tweaking and tinkering. The result can be anything: Improvement, Adaptation or Re-make. Sadly, 90 % of the ideas that float in the market are just re-cycling stuff.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

Six Situations where Ideas are generated

In business and in family life you generate ideas as a response to the situations where you are in. There are six situations that compel you to do something. More often than not you come up with an idea to extricate yourself from a situation. Many a successful business idea came to sunlight as response to such situations. Here are the six situations:

1. Need: A need is defined as un-fulfilled part or whole of a desire. If you look for a fat salary and get only a portion your need is un-fulfilled partly. If you do not get a salary at all your whole desire is gone barren. There is slight distinction between need and want. Whereas a need is not fully supported by the means to achieve it, a want has every means that support in getting it over. Yet another point is that need ranges between what is voluntary and what is necessity. A person needs a TV for entertainment and can do without it though. When it comes to food it is vital necessity as he cannot do without it

2. Requirement: Definition of requirement is thus: something expected, demanded or imposed upon as an obligation. On personal basis a requirement can be voluntary and does not speak of strict obligation. When it passes to the realm of inter-personal relationship requirement becomes much stricter and denotes authority, necessity and perhaps norms & standards. For example one can be nude in his room, whereas when he walks on the street he is expected to be decently dressed

3. Problem: A problem is a situation that is harmful or unwelcome implying an impediment to the progress of anything; as a corollary problem mandates that corrective action must be taken. On the same token a problem conveys a gap between what it is and what it should be; what is desired and what you have finally got; for example a city hall meeting is expected to be peaceful; when fracas occurs in between tow antagonists inside the hall it is a definite problem. Insufficiency is something that woven around a problem occurring in every conceivable areas including data, norms, budget, performance and degree of satisfaction

4. Issue: An issue can be a minor one forming a part of the problem or major one engulfing the entire problem. A salutary point is an issue can be sorted out by discussion, explanation, exploration or by consensual talk. Centrality of an issue can impact the problem at hand. For example sending troops abroad is a military manoeuvre where willingness of the uniformed corps to serve elsewhere could turn out to be an issue

5. Question: A matter that demands information, answer confirmation or clarification. Alternatively question means deficiency in terms of knowledge, connectivity, personal conduct etc.

6. Query: A query is a question that is addressed to someone who holds public or private office. It denotes legal or moral compulsion on the part of the receiver of the query and authority and standard on the part of the issuer.

When you are faced with any of the six situations, you have no alternative other than developing an idea to counter it. In doing so you may land with brilliant idea, really.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

How to Improve your Business?

When you see a business not doing well you have got to find the ways and means of improving it. That is lot of catching up to do. You have to see how the problem arose in the first place; thereafter you have to take the stock of the situation you are in and plan out a solution. Admittedly, many of you have no patience to study and analyse what must be done to take you out of the fire. Furthermore, many of you may not be aware what action is right and what is wrong in the given circumstance. Right actions on your part elicit positive response and lead you to a workable solution; incorrect actions on your part bring in negative response and lead you to disaster. Here are few steps that you must follow in improving your business:

Six Easy Steps

1. Find out what is the Problem that impedes your progress in life
2. Understand the Nature of the Problem
3. Checklist the Causes that led to this Problem
4. Find out a Solution yourself, if this Problem is just a minor issue that can be corrected by you alone
5. Chart out a Solution after consulting your colleagues and staff, if and when the issue is mildly complex
6. Where the problem or issue is fairly complex you call in a Business Adviser to guide you in solving your problem and in improving your business

What you should look for in a Business Adviser?

1. He must be neutral, independent and confidential person well versed in business management.
2. His advice is designed exclusively for you after considering your problem, your issue and your question against your own background rather than churning out generalized hum-drum advice 
3. Any solution must be as distinct as the case may be in relation to your business, your industry or segment, your area or region etc.
4. The business adviser must assist you in making your business better, meaningful, rewarding and satisfying
5. Moreover, he should be able to analyse, understand and evaluate your business along with your personal cosmics
6. Finally, he must give you proper direction and guidance to facilitate taking risk and making decisions.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Make your Business Idea a Success

Your business ideas are sparks of your studied imagination. You get a bright idea in your mind based on your experience and learning and from what you read and reflect upon about how others have gone through. You think your idea is really great. Having mulled it over, you feel that it can be translated into commercial success. But how you do that? It is simple follow the seven stages given here:

1. Write down your business idea in clear and concise English. Improve the draft once again. Check it up to see whether it makes sense to you and to an ordinary reader. Now your spark of imagination is transformed into a concrete idea

2. The second step is to morph your idea into a business concept. A business concept is defined as the result of organized thought of your business idea. It has several limbs structured into a useful form. Let me give an example: you draw few dots vertically or horizontally on a paper. When you link each dots you get a vertical or a horizontal line. In this case, dots are ideas; line is your concept. Typically a business concept has limbs such as profit motive, product as unique value proposition, how the product fits the market needs, how it performs against competition, the cost of product, its revenue generation and finally how it services your overhead and gives you profits. If you have a business concept developed then you will be able to take charge and influence the outcome of your efforts in a business because a well-designed business concept gives you direction, motivation and tenacity.

3. You must test your business concept to ensure whether it is feasible or not. Feasibility must be ascertained as against regulatory environment, economics, environmental issues, marketing parameters, financial viability, technological excellence and social acceptability

4. Once the feasibility is positive then you have to prepare a detailed proposal in the form of a business plan, bringing out details of all the functions of a business organization including corporate management, administration, marketing, production, finance and human resource into a cohesive entity to produce and sell your unique product

5. Guidelines are to be prepared in the next stage where policies and procedures for each department are developed in order to make the business as a going concern. Generally, a budget is drawn for each department and rolled over every year. Segmental plans in product development, market development and human resource development would be detailed. Your investment plan in physical assets and human resources is also dovetailed. Moreover the time and duration of each stage of the business development are also noted

6. Implementing your business plan is the next action step. When you do this invariably you will concentrate on business growth and development along with having safeguards to cover yourself from any eventuality

7. Monitoring progress and adjusting your budget, target, goals along with amending your plan is the seventh and final stage in making your business idea a successful one. As you reach this point you have become mature, experienced and skilled business person. You are ready to take your business to higher levels as you go on.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Doing Business in Sri Lanka, profitable and enjoyable

Sri Lanka is a vibrant country located in South Asia, a region that is home to about 1,590 million people living in most populous and most densely populated part of the entire world. In terms of population Sri Lanka ranks about fifth but in terms of doing business it is ranked second in South Asia. As a gateway to South Asia, Sri Lanka offers unique business opportunities to businessmen and investors.

There are seven countries in South Asia: Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka. The population in Sri Lanka is about 20 million earning an average per capita income of U S $ 2,290/-. Classified as Lower-Middle Income earner, Sri Lanka ranks as the second most business friendly country after Maldives, in the recent annual survey by the World Bank. Titled “Doing business 2012 Sri Lanka” the annual publication compares data out of all seven countries in the region. The score by Sri Lanka at 89 points bode well when compared with the average Regional score of 117. Besides doing business as a whole has improved from the previous figure of 98 recorded in 2011. The survey deals with the following matters in depth: starting business, construction and property, utility such as electricity, obtaining finance, investment protection, taxation, international trading, commercial contracts etc.

Starting and running a business in this country is not only rewarding to businessmen and investors but most enjoyable to them and to their families. There is an attractive resident scheme for investors to start business and live in the country during the pendency of the business. If by any chance the investors wish to dispose the business, they can continue to reside in the country, unlike in the case of Singapore.

As a gateway to South Asia, Sri Lanka and its main ports in Colombo, Hambanthota and Trincomalee offer the state of the art technology in port management. Air freighting is facilitated via Katunayake and other regional airports. Colombo the capital city is a commercial hub for imports and exports to the entire South Asian region. Businesses can be located either in Free Trade Zones or elsewhere without much difficulty.

Heavy and light industry, construction, education, leisure, pharmaceuticals, plantation, agriculture and farming, entertainment, media, healthcare, fashions are key sectors showing great promise along with financial services including commercial banking, credit, stockbroking, asset management, investment and private banking.

Business Opportunity

Inquiries are welcome from prospective businessmen, buyers, developers and investors who wish to start a new business or buy an existing one. Get a piece of action in Colombo Business Centre that has morphed into a star performer in the region. You can recoup your investment in business within a short horizon depending on the market movements. More than that, you will enjoy doing business here, really.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Land for Ecotourism in Maho, Sri Lanka

A once in life time opportunity knocks on your door in the form of a prime land that can be developed as Ecotourism Rest or Eco Lodge in the scenic town of Maho in North-West Sri Lanka.

This prime real estate spawns an area about 19.86 Hectares (about 49.7 Acres). It is situated at Hevanala Yaya, Thalangedara, Maho in Kurunegala District of North-Western Province of Sri Lanka. It borders Nikaweratiya - Madagala Road with a road frontage of around 900 meters. Trains operated by Ceylon Government Railway saunter in the southern edge of the land traversing towards Trincomalee and Batticaloa, towns that are located in the Eastern sea shore. In fact this land is in between two railway stations: one is Maho and the other is Yapahuwa.

The historic city of Yapahuwa was once the capital of Sri Lanka during the 13 Century. Tourists flock to the city in their thousands to view the olden city and centres of tourist attraction such as Kikawala Rock Cave Temple that displays evidence of amazing volcanic rock formations. You can easily access the land travelling from Colombo, Capital of Sri Lanka over fully carpeted road that reaches the land and far beyond. From Colombo you travel 160 km to this picturesque land.

The land is endowed with varieties of well grown fruit trees such as coconut, mango, cashew, wood apple, banana and many others. Moreover it is forested with about 650 teak trees of about 6 years old planted along the boundaries. A meandering and beautiful landscape connects you to rock formations, scrub jungle and a cosy environment of lush greenery. Ground water is available throughout the year in three large ponds that collect rain water. Additionally, two large agro wells provide irrigational water during summer and two wells sprinkle drinking water throughout the year. Existing building structures include a two-bedroom bungalow, two small houses, an office as well as a guard room. There is a weigh bridge currently not in use but serviceable.

Ecotourism

Surrounded by tropical greenery, this property has potential to be developed as an iconic Eco-friendly Tourist Rest or Eco Lodge. One of the norms of Ecotourism stipulated by “The Ecotourism Society” is that places under Ecotourism banner must conserve the environment and at the same time must improve the welfare of the people living in and around the area. This land definitely passes the test of “conserve and improve” concept and qualifies as a prime spot for development as Ecotourism Rest or Eco Lodge. Finance for Ecotourism is generally granted by local and international banks.

Business Opportunity

1. A prospective investor has to buy this land in the first place and thereafter, set in motion a chosen Ecotourism Rest or Eco Lodge construction programme

2. A prospective buyer can buy this land and hold it as an investment asset before re-selling it to any prospective developer bent on these lines.

Inquiries are welcome from prospective buyers, investors or Ecotourism property developers for a price quote. Get a piece of action in buying this plot of land in Maho , North-Western Province of Sri Lanka and experience the real pleasure of being part of ecology.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Land in Nallur, Jaffna for Development

A large plot of land is available in Nallur, Jaffna for property development. This plot of land can be converted into a mixed development consisting of residential apartments, theme park, offices and shops.

This land is of almost rectangular shape with an extent of 3,687 square meters. In Jaffna parlance the extent is stated as 14.35 Parappu. Located in the Point Pedro Road , the land can be easily accessed travelling from Nallur Kandasamy Kovil towards Point Pedro. Passing Sankilian Road Junction the plot of land is for your view on your right side. The entire length of the land is abutting the Jaffna - Point Pedro Road. Originally this land was part of Sankilithoppu. Nowadays it is referred to as Pandarathottam due to the fact that it faces Pandarakulam across the road.

Business Opportunity

1. A prospective investor has to buy this land in the first place and thereafter, set in motion a chosen development programme. Most banks are willing to finance such real estate development

2. A prospective buyer can buy this land and hold it as an investment asset before re-selling it to any prospective property developer later on.

Inquiries are welcome from prospective buyers, investors or property developers for a price quote. Get a piece of action in buying this plot of land in Jaffna which is poised to experience large scale economic and infra-structure development in the near future.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Colombo is gearing up for Private Banking

Huge potential for private banking cannot be dismissed in Colombo, Sri Lanka. Accumulation of wealth in the hands of the top echelon has given added fillip for the need of specialised services such as private banking.

Private banking deals with financial advice and management of money, investment and assets belonging to high net worth clients (HNTC). These clients may be wealthy individuals or big corporates. In the case of individuals private banking plays purely the role of wealth manager. A private banker to a HNTC provides advisory and management of wealth including trust services. These trust services include wills and inheritance, pensions, taxation, and advising and managing of charity and donations. Corporates, on the other hand do not require these services as they have departments within their corporate office to deal with these discreet matters. Both individuals and corporates look for common private banking services including money management, investment management and asset management along with financial advisory. They also seek estate management dealing with management of lands and real estate, custodial services dealing with scripts and bonds and funds transmission domestically or as cross border facility. Few customers might require emergency or bridging finance on fully secured basis. Some of the large private bankers such as Coutts of UK and Northern Trust Corporation of USA provide every conceivable service under the banner of private banking.

Private banking thrives in countries that have financial centres, commercial hubs and industrial zones. Moreover, private banking is in demand where accumulation of capital is so much skewed that only a minor percentage of population possesses immense wealth.

Colombo as financial centre of Sri Lanka is fast becoming a business, financial, commercial and industrial centre. Almost all the HNTCs have offices or residences within the municipal limits of Colombo.

Business Opportunity

1. Existing private bankers can open a branch or window in Colombo to share in the growth momentum taking place

1. Corporates or wealthy individuals can team up to establish a new private banking office in Colombo to get plum and juicy clients, who are wealth boomers but hitherto not exposed to sophistications of private banking but are willing to be on board nonetheless

Inquiries are welcome from prospective bankers, corporates or wealthy individuals who wish to either open a branch/window or form a brand new private banking office. Get a piece of action in private banking in Colombo Financial Centre.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Invest in Asset Management Companies in Colombo

Asset Management is a thriving business in Colombo Financial Centre. You can invest in the equity capital of an asset management company without much hassle. Your investment can be recouped within a short horizon.

There are 18 asset management companies registered with the Securities Exchange Commission of Sri Lanka (SEC). These companies are broadly grouped under Market Intermediaries and named as “Investment Companies”. These companies are permitted to handle investment management, investment advisory and associated activities. Investment management is where the company manages client funds on a discretionary basis. The asset manager makes up his own decisions in investing in stocks and bonds in accordance with an agreed investment strategy but without reference to the client. Investment advisory on the other hand enjoins non-discretionary management where the asset manager is permitted to advise his client and on consent being received he can invest in the recommended stocks and bonds.

All these asset management companies have two types of funds: One relates to own capital funds contributed by the owners by way of equity. Another much large pool of funds relate to the clients’ money which is also referred to as portfolio management be it discretionary or non-discretionary. Generally the percentage of own funds ranges between 5 to 10 % of the invested funds. Portfolio funds form the bulk of invested funds. The 18 asset management companies manage close upon one Billion U S $ in their portfolio funds.

These companies take the worry of financial affairs out of the clients unto themselves. They use professional skills in managing funds belonging to clients, who may be individuals or institutions, big or small, domestic or foreign. They manage a wide ranging portfolio of investments, in equities, fixed income or convertibles (debt that can be converted into equity). They tend to analyse investment needs of clients and structure a portfolio strategy that translates into a perfect match for clients risk/return profile. For example, in the case of a risk-averse client, the portfolio will have more fixed income: i.e. Treasury Bills and Treasury Bonds while for a risk-taking client more weight will be given to high growth equities. It must be emphasized that the investment strategy is formulated by asset manager only after consultation with clients and after obtaining their agreement to this effect. Investments made by asset manager would be in accordance with the agreed strategy and none else.

Business Opportunity

1. You can invest in the equity capital of existing asset management companies

2. You can also obtain approval as asset management company from the SEC; for this purpose you can use companies that are already floated but await capitalization from you

Inquiries are welcome from prospective investors who wish to have a piece of action in Colombo Financial Centre a star performer in the region. You can recoup your investment in equity capital of asset management companies within a short horizon depending on the market movements.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How to Value Business before Buying it?

When a seller quotes a price for his business it is known as “Ask price”. In response a buyer offers his price; this is known as “Bid Price”. After negotiation both parties agree at a price to close the deal. In order to make a bid price a buyer must do a valuation of the business he is interested in. There are six methods of valuing a business before buying it:

1. Asset Value: This is the easiest method in valuing a business. Underlying assumption in this method is that the business is a going concern. You tally all assets tangible and intangibles, fixed and current to get the total value. In the case of fixed assets either you can take the value net of associated depreciation or on replacement value basis. Current assets are appraised generally on realizable amount basis. Intangibles such as goodwill can be re-estimated. From the total assets value you must deduct outside liabilities to arrive at net value of assets in a business. Although the method is a popular one, it lacks credence as it does not take the capacity of the assets to generate income in the future, which is more meaningful to the buyer than just jotting up assets. Moreover, small businesses as well as service providers are very lean on assets but fat on earnings. Hence, asset value may not be representative for these businesses. On the other side of the coin, large scale industry is asset rich but whether they generate adequate returns on assets employed is a moot point

2. Liquidation Value: In contrast to the asset value which is based on going concern, liquidation value takes the business on the footing that it is a gone concern. Liquidation can take place in two ways: orderly or forced. An orderly liquidation takes time and the value cannot be estimated in a brush stroke. Forced sale can take place in near term and it is possible to tug in on likely price. Whichever the manner of disposal, you should ensure that the assets are valued at realizable value net of any expenses connected thereto

3. Earnings Multiple: Since buyers are more concerned with what they can get from using assets, earnings multiple as a method of valuation is used widely in business buying transactions. Generally after tax earnings is considered as the bench mark figure in this type of valuation. You take 3 to 4 years of after tax revenue and average it. Thereafter, you can multiply the figure with number of years purchase. If the average after tax earnings is US$ 100,000/- and the multiple you are conceding is 6 times then the bid price is parked at US@ 600,000/- Earnings multiple method suits well in retailing, wholesaling and medium to large businesses. It is important that you use earnings multiple where the existing business is low geared, that is, it does not use much of borrowed funds. Additionally, you must ensure that depreciation charge in the business is not heavily loaded. A litmus test to opt for this method is to compare the cash-flow with earnings-flow. If there is no substantial difference between these you can choose earnings multiple; otherwise select capitalizing cash-flow method discussed below

4. Capitalizing Cash-flow: Cash-flow is different from earnings in that it ignores accrual accounting concept and non-cash expenditure. It pitches straight on rendering of inflow, outflow and the resulting net flow. Your net cash-flow is what remains in your hands when everything was said and done. There are two ways of arriving at cash-flow for valuation purposes:

4.1. Net-flow + Depreciation

4.2 Net-flow + Interest + Tax + Depreciation (Alternatively known as “EBIT+D” which means Earnings before interest, tax and depreciation)

Once you arrive at a figure under any of the above two methods, you can capitalize cash-flow by using a capitalization ratio chosen by you. Let us assume that, the cash-flow is US $ 150,000/- capitalization rate is 20 % then you can work out the business value as:

US $ 150,000 divide by 20 and multiply by 100 equal to US $ 750,000/-

5. Market Value: Alternatively known as Rule of Thumb or Comparable Business, this method focuses on the market and how it responds to the value proposition of a particular business. You can determine market value in a number of ways. One way is to find out the sum in which similar business was sold and take that as the market value. Another method is to search in the business press for similar transaction that took place during the last 3 months. Yet another method is to estimate the amount the market can bear and after making suitable adjustments treat that as bid price

6. Cosmic Value: At the end of the day, what matters to you most, is the cosmic valuation of the business you intend to buy. Every business has cosmics surrounding it. You have to evaluate the business, its assets, its name, its logo, its customers and its process to arrive at its cosmic valuation. Afterwards you must assess whether incoming business with associated cosmics would enhance your wellbeing or retard it. Many decisions made without considering the critical role of cosmics end in bad note. Why should you have a millstone round your neck?

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Questions Buyer must ask Seller of Business

Imagine you are meeting a seller of business today, what is the first question you will ask him. Oh yes, “what is the price” is the one you on your lips even before you settle down for a talk. This puts the seller in straitjacket, resulting in bad cosmics between you and him. Sellers are miffed over why buyers do not ask a whole heap of questions about his business and how he is going about. Here is my checklist of questions buyer must ask seller of business and in that order.

1. How the market operates? Get the broad picture initially by learning about the market place of the business, how its product is facing up competition. Get the competitor profile, growth rate in the market and whether the business is beating the market or just following it. You can also find out latest market trends

2. Who are customers & suppliers? Ask the buyer to talk about his customers and suppliers. Some of them may be known to you. It is better to dwell little more time here not least because you want lot of names but to assess how critical they are, in terms of volume and value. Also you must ask buyer about credit terms offered and obtained. Will these terms continue to be in force once the business change hands is yet another clarification you need

3. Who is the staff? Number of staff, the gross emoluments and their experience should engage your attention. Key members and how important they are is also a relevant question. Will the staff be happy to get a new owner? Ostensibly, their cooperation is vital for the sale and transition to new owner. Staff is, in essence, in every business which is of course not saying a lot

4. What is the Bottom line? By now you have got a feel of the business. But one caution: do not fall in love with the business on first sight. Ask seller to trot out numbers in profit and cash flow. Look at the profit; look more on the cash generation. When buyer gives you copies of last 3 years financials pore your eyes over the bottom line

5. External relationship: You can chat with him in ease on the question of his relationship with bankers, revenue and other government departments. There is, as must be expected, marked reluctance on the part of seller to talk about these. Still you must be very diplomatic and see whether any of the relationship is strained

6. What he is selling? Let us be very clear about what he is, in fact selling. You are passing half-way mark now and you get him to tell what is up for sale and what is not. Generally a sale of business involves name, operational assets, working capital, and human resource and so on. You must be clear whether present loan outstanding is to be transferred to you or the seller would extinguish it. Another moot point is the real estate, which may or may not be transferred. In case of lease property, you have to ask him whether it is a transferable one. If the business is located in a supermarket, you should ask about the transfer of legal right to you. In sum, you have to clear legal and administrative issues before you proceed further

7. Prospects after you buy: This is putting the seller in your shoes. After you buy his business what happens to it. How sales, operations, profit, finance will be played out?
How quickly you will go through the learning curve in running the business. How this downtime can be minimized? In as much as you love to get answers to these questions about your running business, seller would tend to be reticent and if egged he would be very brief. You must watch his reaction sharply for any nuances that indicate the business is made only for him and after him it is deluge. In other words you are made a sucker, really

8. Will seller be on board? After the sale is done will he continue to be in the board for a limited period is a follow-up question? At the prompt of any negative answer from him you must conclude your discussion and walk out. A seller must be responsible for what he has vouched all these times and in turn assure you his support. He has to introduce you to staff and outsiders; he has to guide and counsel you. If he is going to vanish on the following day you would better drop this matter

9. Wii seller arrange part-finance of the sale price? This is where seller’s external relationship especially with bankers matters. If the seller is an acceptable person he would be able to arrange part-finance of sale consideration through his own bankers or perhaps financiers known to him

10. Why he is selling? If everything is neat and fine, why the guy is selling his business. Most sellers will cite that they are retiring. Some like to take a long vacation or move out to another state or country. Chronic illness or health issues could be a reason. Sometimes they are selling to settle their children or fulfil a divorce settlement. If the seller is vague in answering this question it must put you on guard

11. What is the price? Instead of wrangling price at the first blush, you ask it as the penultimate question. Definitely his price has padding: he must have added lot of goodwill. Most sellers are too emotionally attached to the business they want a hefty price. Or perhaps this is the only cash earner for him. Whatever the reason behind him inflating the ask price, you must keep your powder dry. Do not say bluntly that the price is too much. Ask him how far he is ready to negotiate so that a matter can be closed in due course

12. How do we take it forward? Never leave the seller without getting his idea about how you and seller take the matter further. He would have his suggestions; listen to these and speak your mind loud. Do not leave with a bland “will let you know”. Go positive and say “let us proceed together”.

The above checklist reflects cosmic arrangement of twelve questions that elicit the right response on which you can make sound decision on buying a business.

Good luck!

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How to Restore Business Confidence?

Business confidence reflects the combined idea of the consumers and producers at a given time. Sometimes referred to as business sentiments it could move upward, downward or remain same. Generally we trace sentiments from one point of time to another. A positive upward spiral of business confidence with seasonal correction is always welcome. When business sentiments dip in downward spiral it is a definite cause for worry to business. Let me give you a step-by-step guide how to restore business confidence during such an eventuality:

1. Survey: Firstly, you survey confidence of the economy follow with an assessment of your industry and then finish with what you feel about your own business. Sentiments in economy may be down; your industry confidence may be mutes; still you may feel that your business can weather the storm

2. Bring Pressure: Talk to your industry association and urge them to take necessary steps in industry wide and coerce them to take up the matter with the government to do appropriate policy measures such as effecting tax cuts, enhancing public spending, adjusting interest rate mechanism and relaxing credit regulations

3. Do Internal Self-test: A review of business policies currently in force is the starting point for the internal self- examination. Business policy is all pervading term covering operations, marketing, human resource management etc. While doing this self-test you must see whether you need a structural change internally or just make few cosmetic changes. A complete revamp of a product is a structural change; giving a bit of face-lift in packaging is a cosmetic one.

4. Get External Feedback: Ask your customers. Your customer feedback tells you more about your business than what you already know. You can do a sit-in chat with your main customers who have reduced purchases and a telephone survey with others who have dropped out or buy marginally

5. Readying New Blue-print: Once you have completed both internal and external appraisal you can make a comprehensive survival kit to stay afloat during the do0wnward spiral of business sentiments and then to shore-up confidence levels higher. In this process you have to do touch-up on cost-cutting, hiring employees, investing and finally marketing

6. Review Cost-Cutting: Faced with a scenario of falling sentiments business gives a knee jerk reaction by cutting cost across the board. Most pronounced cut-back is seen in the operational area. You know cutting cost is a two way knife; it can reduce losses and at the same time it shuns business growth. You should use a selective cost cutting if at all one is needed

7. Hiring more than Firing: I know a company which is 180 years old that recruited maintenance staff during high tide of recession. While others were laced with anxiety started firing employees, the company showed glint of steel. Before long the company reaped its dividends with loyal staff and a fat profit. Undoubtedly, the company beat the downing sentiments with bold measures.

8. Invest more: Never think any depression is a prolonged affair. If you stand and wait for good times you will lose the opportunity to break-out. Throw that going in goosestep with your colleagues in the industry. Develop a good grasp of the ground and start investing selectively in operational assets that could turn the corner in quick time.

9. Do Re-marketing: Take measures to set your marketing in sprite. Re-define the customer base, expand where necessary and constrain where needed. Your new look product might have undergone a revamp or facelift as the case may be. By the look of it you know your product is a winner even in the difficult times

10. Network: Nothing works without network. Engage in full time business networking. Meet up industry colleagues, customers, supply creditors, press, and advertisement guys and add spice to the mix by getting your staff to personal promotion of your product and business

11. Bring in Cosmics: Finally, understand and evaluate your own cosmics. Your sentiments, feelings, your ideas are all shaped and influenced by cosmics that reside within you, perhaps un-known to you. Sooner rather than later you will realize the power of cosmics in restoring your own confidence. In turn, you would have contributed your mite in restoring business confidence in the country, really.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

 

If you are in Debt avoid Depression

Spiralling debt brings disappointment, despondency and depression to debtors who never controlled their lives let alone their finance. On the throes of depression is the red line. If depression is not managed, then it leads to fatal consequence. Here is the maxim: If you are in debt, avoid depression.

Debt burden has escalated in the last decade to phenomenal levels, unduly aided by advertisements by credit card issuers and personal finance providers, consumers ratcheted up the borrowings. When the crash came it not only dragged the borrowers low but pulled down the debt providers. Against the backdrop of teetering economy corporates corked off new hiring or at worst began retrench existing staff. Falling income on one side and loss of employment on the other side have trammelled consumers. Business persons are not spared either. They saw to their horror their order book trouncing downwards. Worst affected are the micro and small businesses. Like fall of dominoes, businessmen, consumers and borrowers were stumbled with disappointment, frustration and despondency. Unchecked it ended up in depression. Suicidal tendency was raising its head.

Depression leading to death

Depression as a cause of suicide is now firmly established. During the recession period 2007 to 2009 more than nine countries reported increased rates of suicide due mainly to financial woes. Feeling the sting more, was Greece that recorded a whopping 16% jump in the suicide rate. Ireland followed on heels with a staggering 13 % pike in suicide rates. Britain, though not ostensibly affected could not salvage itself. Recording 8 % rise in suicide rates; Britain tallied 5706 people killing themselves in 2008 many of them cursing debt for their plight.

Does this mean everyone who has loans burden is affected in similar manner? Analysts say that the effect of debt burden on borrowers is asymmetrical. There are no worry characters, which have sufficient asset base and least worried about debt. More than that, they generally flaunt positive attitude towards obtaining and paying out debt. The reckless borrowers on the other hand may not have asset base, but consider more the loans it is merrier. On the middle we have consumers who borrow over the limit considering it as fashion or way of life.

Worry kills

On the other side of the coin are people who are inordinately worried about loans. Most of them are either fixed income earners or enjoy luxury life erstwhile, but were short on disposable assets. A salutary feature in them is that, they get the blame game end with them; in sum, they are justifiably worried about outstanding debt. From this point onwards, we see quick slide towards depression. There is a saying: Why worry kills more people than work because more people worry than work. This comes true as people worry more about their debt. About 11 % of British citizens consider debt as the biggest worry affecting their quality of life. In the case of people who have health issues or suffer from chronic disease, the trepidation is marked. They lose weight and sleep and before long appear mere shadow of their former selves. Worry also targets those who are dependent on drugs or alcohol driving them more towards these. Another casualty is the ones who are light hearted. When they receive notification from their credit card issuers that their file is now transferred to collection departments they get jittery. A follow-up communication that the file is now with third party collector sends shiver through their spines, leading to intermittent bouts of depression.

Seeking remedy

Not everyone acknowledges going through low. Many hide it and implode one day by taking their lives out. Out of others who realize nearly 80 % do not take counter-measures and lurch towards the danger zone in matter of weeks if not days. The fortunate ones re-examine their affairs. They follow three track policies to take them out of the mire.

1. Consult medical professional in treating symptoms of low feeling to get back to proper health

2. Seek advice in arranging creditor meeting, re-scheduling loans and recovery finance to turn the corner

3. Obtain counsel in understanding and evaluating your cosmics, so that you can once again make your cosmics work for you. Cosmics are aspects residing within you generally go un-noticed. Once you know your cosmics well you can manage debt and the resulting depression better.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Whatever happened to Personal Finance?

No doubt, personal finance had seen a major dip in 2011. When you analyse the performance of chief areas of personal finance namely, mortgage, car finance and credit cards, a glaring trend pops up. Consumers are shunning mortgage and car finance and banking on credit cards. Instead of accumulating assets consumers have jacked up credit card expenses. Whatever happened…..?

There is an adage; when the going gets tough, the tough gets going. As we see a big reverse in personal finance in 2011 consumers instead of being tough on pruning expenses have gone soft on expense loading. Spending via credit cards has notched up in many countries. Britain experienced a staggering 35 % growth in credit card outstanding compared to the previous year. Conversely the number of people using credit cards rose marginally by about a percentage and clocked at 12 Million. In America the outstanding skyrocketed to U S $ 65 billion, a hefty US $ 20 Billion more than the figure for 2010. There again the number of users remained almost stagnant.

In comparison, mortgage finance pales into insignificance. Britain experienced a chipping away of almost 10 Billion sterling worth of Mortgage debt in 2011 bringing to the mind of 1970s when economy was in the dog house. Reduction in activity in the home market coupled with a significant reduction in re-mortgaging were the chief cause for this trend. More potential home borrowers kept away from availing finance even though banks were ready and willing to grant them finance. In fact mortgage loan approvals topped Sterling 8 Billion but much less were actually drawn down. Most lenders reported that borrowers were keen in paying existing finance at quicker pace to bring down the interest cost. They agree that the loans that exist now are booked when interest rate regime was in higher integrals.

Same story was repeated in the car finance scene too. Car sales were down 4.4 % in Britain in 2011. The number of cars sold was 1.94 Million lowest since 1994. Sales were mainly in the medium market models lending credence to the figure of 96,112 of Ford Fiesta sold. In contrast high market BMW 3 Series clutched at 42471 cars. In line with this, loans for acquiring new cars also plummeted. No major banks came out with any innovative car finance scheme in 2011. Reading from what is happening in the personal finance you cannot help but come to the conclusion that consumers are smart borrowers. Here is the sketch of their mind-sets as painted in my canvas:

1. Short-terming: Consumers have resorted to fire fighting; that is to play in the short term market rather than dabble in long term market

2. Asset as burden: They are not keen to garner assets like home and car investment that could easily become a weighty burden. Whereas blipping up expense is a manageable one. This blending of financial alchemy displays shrewd reading of the economy on the part of the borrowers

3. Lowering interest cost: Borrowers are going one over other to pay down high-interest home loans

4. Budgeting well: Consumers show remarkable ability in using interest free credit period offered by credit card companies and liquidate outstanding in time

5. Cosmics have landed: Borrowers are driven by their cosmics to play safe without getting into too many financial commitments which if goes un-checked would, potentially lead to long term instability in mental peace and financial balance. Keeping cosmic balance dictates that they go on rope walking this time around and wait for things to improve in 2012.

Muthu Ashraff

Business Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/